‘Bonus’ Payment to Informant Draws Criticism

An undercover informant at the center of one of Orange County’s biggest crackdowns on street crime is counting on police to help him repay nearly $6,000 in bad checks he allegedly wrote while on the police payroll, his attorney said.

Jose G. Nolasco, a convicted drug dealer whose undercover work in a crime-plagued Santa Ana neighborhood led to 125 indictments, was charged with three felonies last year for allegedly passing bad checks during the seven-month “Operation Orion.”

His attorney, Michael Molfetta of Newport Beach, said law enforcement agencies will help Nolasco pay nearly $6,000 restitution.

“Law enforcement is actively involved in raising the money,” Molfetta said. “Whether that’s a bonus or a gift or a loan, I don’t know.”

Nolasco already had received $58,000--including cash payments, rent and medical expenses--during the operation in 1999 and 2000, court records show.

Prosecutors say that while Nolasco will receive an extra “bonus,” the payment was promised to him at the beginning of the operation and is not connected to the felony charges.

Defense Lawyers Are Angry

However, that assurance failed to douse criticism from angry defense lawyers whose clients were arrested during the operation. They contend that Nolasco’s alleged crimes were far more serious than those of many low-level drug dealers he helped arrest.

“You’re paying this guy so much money to go after my guy with $10, $20, $30 sales,” said Michael Giannini of Orange County’s alternate defenders office. “That’s an outrageous use of public funds. You’re using a sledgehammer to get a flea.”

A prosecutor who worked on the Orion investigation said the money Nolasco will receive is simply a final cash bonus from law enforcement agencies that paid him throughout the operation.

Nolasco, 28, can use that bonus as he pleases, including repaying the stores he is accused of defrauding, Deputy Dist. Atty. Jeffrey Ferguson said.

“The notion there’s some agency that’s going to take care of this on his behalf, that’s wrong,” Ferguson said. “This was money he was going to get whether or not he owed restitution.”

The amount of the bonus has yet to be determined, but the cost will be shared by the FBI, state Bureau of Narcotic Enforcement, Santa Ana Police Department and the district attorney’s office, Ferguson said.

The payments were necessary, authorities said, because it would have been impractical for Nolasco to hold a job while working full-time on the investigation.

Nolasco was awaiting deportation in 1999 when Orange County authorities tapped him to work undercover as Operation Orion’s star informant.

Informant Took Drugs During the Sting

He cruised the city’s Santa Anita neighborhood, buying drugs and stolen property in a car equipped with a sophisticated hidden video system.

After the arrests, word of Nolasco’s troubles began to surface.

In a trial for one of the suspects last year, Nolasco testified that he took drugs while working for the police and overdosed on heroin on the eve of his testimony before the county grand jury.

Nolasco could face more than five years in prison if convicted of writing 19 bad checks while working undercover during the police operation. The state attorney general charged Nolasco with three felonies for allegedly passing the bad checks during a three-day shopping spree in Orange County.

Under a tentative agreement, Nolasco will repay $5,951 to businesses ranging from Home Depot to PetsMart and the charges will be reduced to misdemeanors without a jail sentence, Molfetta said.

Capistrano Beach lawyer Dean Steward, who regularly dealt with informants as head of the county’s federal public defender’s office, described the arrangement and payments to Nolasco as unusual.

“It seems like they gave him a get-out-of-jail-free card,” Steward said. “Pay to informants is very common. The unusual part is allowing this guy to commit crimes and then reimbursing him for it. They can call it whatever they want. . . .That’s just not right.”

Santa Ana police Sgt. Raul Luna said Nolasco, now living out of state for his own safety, should be credited for cleaning up a neighborhood once plagued by crime.

“Because of his cooperation, the quality of life in our neighborhoods has improved over what it once was,” Luna said.