MISHANDLING OF INFORMANT HURT CASES, DEA CONCEDES

Crime: Because the system missed warnings of operative's misdeeds,
many charges have been dismissed or weakened.

Dozens of drug enforcement cases nationwide have been dismissed,
plea-bargained or threatened with reversal because of the U.S.
Justice Department's abysmal handling of its undercover informant
program, according to an internal report, court documents and
interviews.

Officials in the Drug Enforcement Administration and federal
prosecutors failed the public when they ignored repeated warnings
about a rogue, unreliable undercover informant for more than 12
years, DEA investigators concluded in a report released under the
federal Freedom of Information Act.

And because the DEA had no system for tracking its informants, other
agents and prosecutors kept using its most prolific operative,
unaware of his pattern of lying under oath and criminal misconduct,
according to the 157-page report, which was based on a yearlong
investigation.

In its report, the DEA acknowledged that drug agents and prosecutors
failed to disclose problems involving key informant Andrew Chambers
in many of the 280 cases he worked on, jeopardizing convictions
dating back to 1984. The agency paid Chambers, whose behavior
prompted the DEA's internal investigation, about $2 million in
taxpayer money.

As a result of Chambers' actions, federal prosecutors in Florida,
South Carolina, Missouri and Colorado have dismissed outright the
criminal charges against at least 26 alleged drug dealers.

In Miami, prosecutors dismissed at least four cases against suspected
cocaine and heroin traffickers because they felt "sandbagged" by the
DEA, the report said.

In Los Angeles, a plea bargain allowed a five-time felon facing
another prosecution to walk out of jail three months ago even though
prosecutors wanted him in prison for life.

Angry Prosecutors Refuse to File Charges

The DEA, like the FBI in its handling of the Oklahoma City bombing
case against Timothy J. McVeigh, failed to turn over internal records
to the defense in criminal prosecutions, as required under federal
law. Whereas the FBI did not provide thousands of pages of documents
to defense lawyers, the DEA did not reveal the key informant's
misconduct.

"With the DEA, it is a case of government run amok with nobody
watching," said Terry Rearick, chief investigator for the Los Angeles
federal public defender. "And when they got caught, they just cut
deals and plea bargains with people to make them go away."

Some federal prosecutors, angry at not being told of the misconduct,
refused to file charges against some suspects arrested by the DEA.
They plea-bargained others instead of taking them before a jury.

And now defense lawyers may appeal scores of cases.

DEA Administrator Donnie R. Marshall declined to comment about the
report or the agency's relationship with Chambers.

Michael Chapman, the agency's chief spokesman, said, "Problems have
been identified, and we have taken corrective action."

The agency has begun setting up a central system to monitor
informants, according to the Justice Department, which oversees the
DEA and federal prosecutors.

The U.S. attorney's office in Los Angeles received Justice Department
approval May 25 to install its own system to track informants, not
just for the DEA, but for all federal law enforcement agencies, said
interim U.S. Atty. John Gordon.

"We wanted to address a problem that occurred here to prevent it from
reoccurring," he said. "If ours works well, it may be the template"
for other prosecutors nationwide.

The drug agency launched its internal probe last year after news
agencies, including The Times, published detailed reports about its
relationship with Chambers.

The agency recently released an edited version of the previously
confidential report to defense lawyers and the media in response to
requests under the Freedom of Information Act.

The report said investigators interviewed more than 100 agents,
prosecutors, lawyers and judges to determine "how Chambers was able
to testify falsely in judicial proceedings without the knowledge" of
federal authorities.

Although the report was spurred by Chambers' actions, it found
"systemic" problems with the DEA's paid informant program.

The probe revealed an agency with "no effective system in place" to
manage its thousands of paid informants, even though their undercover
work and testimony is crucial in putting drug dealers behind bars.

Report Cites Neglect, Ineptitude

Few informants are without legal problems of their own, and often
agree to work for the government in exchange for leniency. Federal
law requires the government to turn over negative information about
informants--including criminal histories and records of false
testimony--so defendants can challenge their accusers' credibility in
court.

In its report, the agency cited management deficiencies, as well as
neglect, ineptitude and even cover-ups among agents and federal
prosecutors, in some cases out of reluctance to "blackball"
successful informants like Chambers.

Driven in part by the lucrative payments, "Chambers was able to
exploit, either wittingly or unwittingly, that weakness in the DEA
[confidential informant] system" by working drug cases in 31 cities,
the report said.

Federal investigators concluded that Chambers lied at least 16 times
in drug cases and that he was arrested at least 13 times, on charges
that included fraud and assault. Twice he solicited a prostitute and
then claimed to be a federal agent to avoid arrest.

Chambers was convicted once, for soliciting a prostitute.
Investigators found that some other charges were dropped after
authorities interceded on his behalf.

The internal report does not place blame on the agency's highest
officials. Top management, it concluded, was not aware of Chambers'
misconduct until mid-1999, 14 years after he first lied on the
witness stand and got arrested while working for the government.

If top managers had known of the problems, they could have kept cases
from being tainted by warning agents and prosecutors nationwide.
They, in turn, could have alerted defense lawyers, according to the
report.

Chambers, a 43-year-old former Marine from the St. Louis area,
ultimately helped the DEA arrest more than 400 suspects and seize $6
million in assets. On assignment, he would drive into cities in a
fancy car, meet the street hustlers, set up deals and then help
agents bust everyone involved.

His success led to paid jobs with the FBI, the Customs Service, the
Internal Revenue Service, the Secret Service and other law
enforcement agencies.

But the DEA now believes Chambers began lying on the witness stand in
1985, just a year after joining its payroll.

By then, he was working cases in Los Angeles, site of one of the
agency's most active field offices.

On three occasions, Chambers told federal juries in Los Angeles that
he had a criminal record and that he had lied under oath in previous
trials, the report said.

The first time, on June 9, 1988, the DEA agent working with Chambers
left the courtroom and alerted her supervisor. Her concerns were
never documented in Chambers' case file or sent up the chain of
command, the report said.

Despite her concerns, the agent told investigators that she continued
using Chambers through the early 1990s in about 25 cases involving
"violent large-scale drug traffickers."

The prosecutor in the case also did little to raise warnings about
Chambers, saying it was the DEA's responsibility, the report said.

In the late 1980s, authorities told Chambers he could no longer work
for the federal government in the Los Angeles area because of a
dispute over how he spent public money.

Still, his popularity among agents soared elsewhere.

By the early 1990s, he was working in at least 12 states. He also
came back to Southern California, working DEA cases out of a Santa
Ana office for three years.

Chambers testified that he never smoked, drank, took drugs--or got
arrested. He was an informant, he would say, because he wanted to
clean up the streets.

The DEA report concedes that Chambers lied repeatedly about his
criminal record, his failure to pay income tax and his level of
education. The agency says he never lied about the "material" facts
of a case.

In 1995, U.S. District Judge Edward Nottingham in Denver accused the
DEA of "outrageous government misconduct" for paying Chambers so much
money to work drug cases. He ordered prosecutors and agency officials
to pull together a centralized record of Chambers' work, payments and
court testimony, so lawyers nationwide could access it.

Instead, prosecutors dismissed the drug case in question--and four
others, the report said.

Prosecutors in Denver also warned the DEA's office of chief counsel
in Washington about Chambers. But agency lawyers ignored them, the
report said.

In 1996, Chambers was back in Los Angeles helping the DEA and the FBI
with their takedown of alleged drug overlord Edward Stanley Jr.

Rearick, the investigator for the public defender's office, got the
case and became suspicious. The government's unidentified operative
sounded a lot like Chambers.

"I thought, it can't be," Rearick said recently. "There's no way the
DEA would be that stupid."

But Chambers was indeed the informant. So a federal public defender,
H. Dean Steward, petitioned the DEA for its files on him.

The agency refused. Rearick and Steward investigated Chambers on
their own and uncovered evidence of his arrests and false testimony.
They brought it to prosecutors, alleging DEA misconduct.

The Los Angeles prosecutors summoned top local DEA officials,
demanding to know why they were not aware of Chambers' problems and
why the DEA continued to use him. Like their Denver colleagues, they
alerted agency lawyers in Washington. They too were ignored, the
report said.

And DEA agents continued to employ Chambers, paying him more in
1997--$366,227--than in any other year, agency records show.

In October 1997, Chambers helped the DEA arrest repeat offender Dave
Daly during an alleged drug deal in Los Angeles.

By then, prosecutors had insisted that Chambers' local DEA file
document his misconduct.

However, agents continued to use Chambers.

"Obviously [they] did not check the file, either because they were
not required to, or it was not available to them," the report said.

In 1998, DEA internal affairs investigators interviewed Steward, but
dropped the inquiry "when they learned that Steward was not alleging
misconduct by a DEA employee" but rather by an informant, the report
said.

Restrictions Follow Judge's Accusations

It wasn't until July 1999, after U.S. District Judge Gladys Kessler
in Washington D.C. accused the DEA of "extensive government
misconduct," that the agency's top management was notified of the
problems, according to the report.

Even then, the DEA and prosecutors continued using Chambers. And he
continued to lie.

Finally, the agency restricted its use of Chambers in September 1999.
He was deactivated five months later.

Gordon and Michele Leonhart, the special agent in charge of the DEA's
Los Angeles division, said they stopped using Chambers when his
problems became known, and limited his use in subsequent prosecutions.

Still, earlier this year Los Angeles prosecutors were proceeding with
their case against Daly when his lawyer, John Martin, filed a
250-page motion to dismiss the charges. He alleged that a history of
DEA misconduct in its relationship with Chambers "has stained
judicial proceedings across the country."

Prosecutors offered to release Daly on time served--if he promised
not to sue the government. On March 24, he walked out of a downtown
lockup a free man.

"I think they didn't want to run the risk that a judge would find
that their own misconduct was so plain as to warrant outright
dismissal of the case," Martin said.

As for Daly, Martin said, "He's pinching himself that he's even home."