Yes, anyone who's been entrusted by God with a position of spiritual leadership certainly should be above reproach in their character and the way they live. Paul urged his young pastor friend Timothy to flee from sin "and pursue righteousness, godliness, faith, love, endurance and gentleness" (1 Timothy 6:11).
I hope you'll see this event for what it truly is: a great tragedy -- both for the individual and his family, and for his church. On a broader scale, something like this also hurts the cause of Christ, because it only confirms what some unbelievers claim: the church is full of hypocrites. (It isn't true, of course; most only use this as an excuse to avoid giving their lives to Christ.)
How could this have happened? Only God knows; perhaps this individual had drifted away from Christ, or had failed to guard against sin. But Satan also will do everything he can to bring down a spiritual leader -- looking for weaknesses, drawing attention away from Christ, playing on their pride, and so forth. The Bible warns, "So, if you think you are standing firm, be careful that you don't fall!" (1 Corinthians 10:12).
Pray for this individual and his family -- and pray especially for the members of his church, that their faith won't be shaken. Most of all, make sure of your own commitment to Jesus Christ, and pray that your faith will grow stronger every day. Jesus said, "Blessed are the pure in heart, for they will see God" (Matthew 5:8).