This site isn't set up for hypotheticals. If it were, Jim would need a criminal defense attorney.
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If he were arrested, he should speak to an attorney. My take is that he is in some fear and paranoia. Drugs can cause an individual to be anxious, irrational and make foolish decisions. I have never seen CIs or undercovers work this way, I seriously doubt that is the case. However, if arrested---he needs an attorney. I take it there is a little more to this story. DO not post anything additional regarding the facts on an open website.
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