FBI 'allowed mafia to continue with plot to kill gangster'

Already struggling to mend its tattered reputation in the wake of a major spy scandal and a catalogue of high-profile botched cases, the FBI is facing fresh embarrassment. Evidence emerged on Friday it had knowingly allowed paid informants inside the Mexican Mafia in Los Angeles to plot and commit a series of major crimes, including murder.

According to internal FBI reports and transcripts of wiretapped conversations obtained by the LA magazine New Times, the federal authorities followed a plot to murder Chuey Martinez, a Latino gangster, for seven months in 1997-1998 without arresting the conspirators or issuing any warnings.

In that time, Martinez was shot at and almost killed, another gangster who had been repeatedly threatened was murdered and associates of Martinez were assaulted in prison. All this was monitored and followed by five FBI agents, their supervisor and two federal prosecutors without any intervention. "This shouldn't have happened," a former deputy assistant director of the FBI, Danny Coulson, said. "I don't know how they couldn't have acted on this information. I cannot believe a supervisor wouldn't have recognised this as a conspiracy to commit murder."

The case echoes a long-running scandal in Boston, in which the Feds gave a mafia chieftain, Whitey Bulger, a license to commit crimes, including murder, over several decades. Two men, Joseph Salvati and Peter Limone, spent more than 30 years in prison for crimes they did not commit because the FBI chose to protect its informants rather than release exculpatory evidence.

The bureau's chief informant in the LA case was a gangster called John Terscak, who received $40,000 (£28,000) for his services. His contract explicitly forbade him to initiate crimes or participate in acts of violence. From October 1997, however, clear evidence emerged of a plot against Martinez involving Terscak and a second FBI informant, Ben Montoya.

By mid-December, a plan was openly discussed to open fire on Martinez in his car, and three days later it went ahead. Martinez was hit in the hand, arm and head but escaped.

Fresh evidence continued to surface. In April 1998, a Central Valley drug dealer called Victor Murillo was shot dead; explicit threats against him had been heard by the FBI five months earlier. Around the same time, two associates of Martinez were attacked in the LA County jail on direct orders from Terscak.

It was only after Terscak ordered Martinez's murder in late April that the FBI finally warned Martinez he was in danger. In the end, everyone was arrested and convicted of multiple violent offences, including Terscak who was cut no slack despite months of indulgence from his handlers.

Mr Coulson said it was highly illegal for the FBI to allow crimes to be committed in this way. He said: "You can't sacrifice human life to make cases."