Another Deputy Indicted in Theft of Drug Money : Law enforcement: He is charged with stealing more than $1.5 million in cash seized from narcotics traffickers.

Another Los Angeles County Sheriff’s Department narcotics officer was indicted by a federal grand jury Wednesday on charges of stealing more than $1.5 million in cash seized from drug traffickers.

Stephen Nichols, 40, of La Habra Heights was one of eight suspended deputies who escaped implication two years ago when nine other members of elite sheriff’s drug enforcement teams were indicted as the result of an FBI sting operation.

Wednesday’s indictment accuses Nichols of stealing the cash from drug dealers during an investigation in La Habra Heights in October, 1988. Nichols is accused of laundering part of the stolen money by purchasing cashier’s checks and using the checks to make payments on an expensive motor home.

According to the indictment, Nichols delivered a gun and more than $60,000 in stolen cash to a friend to hide from federal investigators. In addition, Nichols falsified locker records at a storage facility in Santa Fe Springs to hide the contents from the investigators, the indictment said.

He also is accused of evading federal income taxes for 1987, 1988 and 1989.

Nichols was arraigned on the charges before U.S. Magistrate Charles F. Eick Wednesday afternoon. Despite arguments by Assistant U.S. Atty. Steven M. Bauer that the defendant was secretly trying to sell his home and was preparing to flee, bail was set at $50,000 and Nichols was released.

He faces up to 229 years in prison and fines totaling $6.5 million if he is convicted on all 18 counts against him, the U.S. attorney’s office said.

Since the money-skimming scandal broke three years ago, more than 30 deputies have been suspended and 25 people, including relatives of the officers, have been indicted.

Twelve defendants have been convicted of federal charges and the Sheriff Department’s major drug investigation teams--including the Major Violators One Narcotics Task Force, for which Nichols was a lead investigator--have been disbanded.

According to Assistant U.S. Atty. Barbara M. Scheper, Nichols and eight other members of the Majors One team arrested five Colombians at a home in La Habra on Oct. 7, 1988, and seized 143 kilograms of cocaine.

The team members filed reports indicating that when they searched the suspects’ car, they also found about $600,000 in cash, which was placed in a Sheriff’s Department evidence locker, Scheper said. But the suspects told federal agents that they had left far more cash in the car, about $3 million, the U.S. attorney’s office said.

Nichols is accused to taking $1.5 million of it. “We don’t know where the rest of it is,” said Scheper.

Thus far, no other member of the Majors One team has been charged in connection with the La Habra raid, Scheper said.

Team member Tyrone Powe, 39, was sentenced to a seven-year prison term last month after his conviction on conspiracy, theft and tax-evasion charges, but those charges stemmed from another drug-related money-skimming case.