A confidential informant for the Drug Enforcement Administration compromised dozens of prosecutions across the United States by falsely testifying under oath and concealing his own arrest record, but the DEA continued to employ him for 16 years despite detailed knowledge of his wrongdoing, according to interviews, court records and an internal report by the agency.

By the time Justice Department officials took Andrew Chambers off the DEA payroll last year, he had wrecked prosecutions of street-level drug traffickers in Florida, Colorado, Missouri and South Carolina, but had earned about $1.8 million from the government, according to the report and interviews.

In Florida, charges against 12 suspected drug dealers have been dismissed. In California, a convicted drug dealer was freed this year without a trial. Other defendants around the country continue to challenge their convictions.

The use of paid informants has long been controversial, and not only for the DEA, because their misdeeds can derail complicated and expensive law enforcement efforts. Last month, a congressional committee launched an investigation of the FBI's use of mobsters as confidential informants. But the DEA's mishandling of Chambers is a particularly egregious example of what can go wrong.

DEA agents "were addicted to him," said Los Angeles defense lawyer John P. Martin, whose client, Dan Daly, was released from jail in March because of questions about Chambers's credibility. "They were willing to overlook his perjury -- if not assist him in continuing to perjure himself -- because they were able to make cases."

The DEA knew that Chambers had lied under oath in at least 16 of 25 sworn depositions and trials about his personal arrest record, failure to file tax returns and education, according to a 157-page internal DEA report released in May. Despite numerous arrests, Chambers has been convicted only of a single charge of soliciting a prostitute.

But the agency hid Chambers's actions from some prosecutors and defense attorneys. And on at least three occasions, DEA agents paid Chambers's bail, had it reduced or persuaded judges and prosecutors to drop charges against him, the report said.

"DEA realizes it didn't do the best job it could with its confidential sources," spokesman Michael Chapman said. "We realize a lot of mistakes were made. This was not one of our finer moments."

Top DEA managers said they were unaware of Chambers's record and there was no centralized system to track which informants were testifying, though at least one DEA agent knew of perjury by Chambers as long as 12 years ago. But Chambers kept working for the DEA in 31 cities because he helped make a lot of cases.

It was largely because of the determination of a federal public defender in California, H. Dean Steward, that Chambers was removed from the government's payroll in February 2000. Steward investigated Chambers on his own and sent his conclusions to numerous defense attorneys, prosecutors and then-Attorney General Janet Reno.

Yet, Chambers has since been paid an undisclosed sum to testify in a drug case in Louisiana, Chapman acknowledged. Chambers faces no disciplinary action from the DEA.

"Once it was established that he perjured himself in a court of law, they should have stopped using him," said Steward, now in private practice in California. "But this gets back to the mentality of winning at any cost, and the DEA has been of that mind-set since the Reagan years."

Chambers, 44, who has never been prosecuted for his false testimony, is living with his younger brother in Champaign, Ill. He has declined to comment on the allegations and said he now travels the country as a motivational speaker. His attorney, David Ucherek, did not return repeated telephone calls to his Champaign office.

Two DEA employees are under investigation in connection with the Chambers case, Chapman said. Chapman declined to identify the employees or discuss their alleged wrongdoing.

The case was previously detailed in the St. Louis Post-Dispatch and the Los Angeles Times.

Lucrative Job Offer

Chambers began informing for money in 1984, after he walked into the DEA office in St. Louis hoping to land a job as an agent. Being a high school dropout ruined his chances, but the agency offered Chambers something else: a job as a confidential informant. He became known as Confidential Source No. 84-036739.

It was a job that would turn out to be long-term and lucrative for the former altar boy from the working-class St. Louis suburb of University City. Chambers said in an interview that he was raised in a Catholic household, attending Mass on Sundays with his parents and four younger siblings. He dropped out of Mercy High School in the tenth grade, spent three years in the Marines and wandered from job to job until hitching up with the DEA.

His deal called for him to be paid by the case. Each time his work led to an arrest, he would receive a percentage of the assets seized. The agency also paid his expenses.

In 1990, for example, the DEA paid Chambers more than $263,000. In 1997, he received more than $366,000. Over the years, 112 supervisors approved payments to Chambers, and he became one of the highest-paid informants in DEA history, according to agency officials.

Chambers also may have received hundreds of thousands of dollars working for the FBI, the Internal Revenue Service and law enforcement agencies around the country, the DEA report said. Neither the FBI nor the IRS would comment on Chambers's employment.

DEA officials justify Chambers's compensation by citing his ability to penetrate the drug culture. During his years as a full-time informant, Chambers assisted in the arrests of more than 400 drug suspects and the seizure of $6 million in assets, according to the report.

Chambers often set up drug dealers by driving around blighted urban neighborhoods, pulling up to a fast-food restaurant or car wash in a Mercedes, Jaguar or Cadillac. He wore brand-name clothing and almost always sported a baseball cap, an outfit that suggested to drug dealers that he might be one of them.

"I have all the clothes on, I drive the fancy car . . . I got the medallion," Chambers said in an April 1999 deposition in a Tampa drug case. "I mean, I look like somebody who's doing something."

In March 1985, less than a year after he was put on the DEA payroll, Chambers was charged with felony forgery after allegedly signing his brother's name on a $12,297 loan. An arrest warrant was issued after he failed to appear in court, but the judge and prosecutor agreed to dismiss the charges "in the interest of justice" after being contacted by a DEA agent, according to the DEA report.

It was just one of 13 times Chambers was arrested while serving as an informant, Chapman said. Three weeks after his arrest in the forgery case, Chambers was charged with defrauding a Paducah, Ky., jeweler of $1,555. The DEA had those charges dropped, too.

"It's not our practice to bail criminals out of jail," Chapman said. "But based on charges and the case and our need for him, it's possible that sometimes we do do that."

In May 1986, Chambers was back in St. Louis, charged with disturbing the peace and larceny, records show. Between 1989 and 1995, he was charged with soliciting a prostitute and impersonating a police officer in Denver. He pleaded guilty to the solicitation charge and was fined $500, the DEA report said. The prosecutor agreed to drop the impersonation charge after the DEA intervened.

"There's nothing out there I haven't done," Chambers said. "But I am good at what I do."

Drug Cases Undone

Harold "Pops" Laudrum had just won $5,000 in the Florida lottery in December 1998 when he and his stepson, Dahrol James, allegedly decided to purchase half a kilogram of cocaine from a man in Lakeland, just outside Tampa. The man, later identified as Chambers, assured them he had "easy access" to drugs, and the trio made arrangements to meet in Tampa the next day.

When Laudrum pulled his blue Lincoln Continental into a Wal-Mart parking lot near Interstate 275, James jumped out and approached Chambers's car. James told Chambers he had only $6,500, or $2,500 short of Chambers's asking price, according to a deposition.

Chambers told James he could pay him the rest once he sold the drugs. As Chambers handed James the package, police surrounded the car.

Charged with cocaine-trafficking, Laudrum pleaded not guilty. James pleaded guilty and was scheduled to testify against his stepfather, police and court records show. But after Tampa prosecutors learned that Chambers previously lied under oath about his criminal background, they dropped charges against both men.

"I was not going to have my people go in front of any judge and represent this guy and vouch for his credibility," said former Tampa prosecutor Eric Myers, now a judge.

Chambers surfaced again six months later, when Charles Carpenter and Gilbert Manning arrived in Tampa from East St. Louis, Ill. The two allegedly were searching for cocaine when they met Chambers and an undercover police officer on the street and agreed to pay $35,000 for two kilograms. They were arrested and charged with possession and trafficking of cocaine.

Prosecutors dismissed the case against Carpenter and Manning in March 2000 after learning that Chambers -- their key witness -- had lied under oath in previous cases.

"This is a product of the government doing 99 percent of the cases through informants -- unsupervised informants," said Rick Escobar, whose law firm represented Manning. "The problem is, there are hundreds just like [Chambers]."

Letter to Reno

Former public defender Steward first heard about Chambers in 1997 while representing a man indicted in a murder-for-hire scheme. Prosecutors mentioned an informant from the St. Louis area who had worked for the DEA for more than 10 years and had been caught lying in some cases. Steward took a photo of Chambers to his client, who identified him as the man who "set me up."

"We cut a deal a month before the trial," Steward said. "They gave us this sweet deal because they knew this was someone they didn't want to call on the witness stand."

Steward then began gathering records on Chambers and sent a request, under the Freedom of Information Act, to the DEA for its files on him. "They sent me one page," Steward recalled. "It was an incomplete, erroneous rap sheet. The only reason they gave it to me was because they knew I already had it."

Steward later uncovered court cases in which Chambers had lied before. Then he sent a letter to Reno in January 2000 urging her to "consider instructing" the DEA to drop Chambers.

Reno said in an interview that she forwarded Steward's letter to "the appropriate agency. . . . I told them they had to review it and pursue the allegations and come up with some satisfactory solution."

After Chambers's removal, the DEA launched its own investigation. The draft report was circulated in the Justice Department in September, and a redacted version was later sent to Steward, Chapman said.

The report blamed a "breakdown in communication" for allowing Chambers to remain on the payroll for 16 years, but said the DEA's top managers were not aware of his false testimony.

"He was different than most informants," said Gerry McAleer, who oversaw the Chambers review and is in charge of the DEA's New York office. "He was transient. Every city kept their own file on him. Now we're tracking when and where and how often informants are testifying."

Staff researcher Lynn Davis contributed to this report.

Andrew Chambers earned about $1.8 million from the government.