Jailed informant says he witnessed torture, murder along U.S.-Mexican border.

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In a small-town jail in the upper Midwest sits a once highly-paid informant the U.S. government would probably rather you not know about.

An ally to federal lawmen, he witnessed torture and murder in the drug war along the U.S.-Mexico border.

While he’s not charged with a crime, the prisoner secretly awaits what may be his death.

Guillermo Ramirez-Peyro, nicknamed "Lalo," is a former Mexican highway police officer who turned to the drug trade and then became a drug informant who earned $224,000.

The same U.S. agency that paid him, however, now wants to deport him back to Mexico and an almost certain death.

“They say they are afraid I could be killed here,” said Lalo referring to the U.S. Immigration and Customs Enforcement, also known as ICE. “But they want to put me where they are sure they'll kill me.”

Lalo told WFAA-TV he doesn’t understand the reasons behind efforts to deport him, but others said the reasons are obvious: It’s because of the dirty secrets he knows.

“The federal government is trying to protect the federal government,” said attorney Mark Conrad, a Customs agent for 27 years. “That's the first second and third priority here. Lalo is expendable.”

The secrets surround the government’s oversight of Lalo and his work infiltrating a cartel-operated house in Ciudad, Juarez, across from El Paso.

In the backyard of the two-story duplex, 12 corpses were uncovered in early 2004. Most of the victims were tortured and suffocated with plastic bags.

Lalo said his federal handlers knew he worked to oversee the unlocking and preparation of the house prior to murders, known as “carne asadas.”

He also said he oversaw burial of the bodies.

ICE agents and other U.S. officials, Lalo said, knew victims were being killed during a more than five-month spree from August 5, 2003 until January 14, 2004.

“They knew what was going on all the time because it's not a thing that happens in one week," he said.

Lalo said he audio-taped the first murder, which ICE agents transcribed and listened to. He said the agents thanked him for his work.

“All the bosses, everybody was happy,” Lalo said. “The only thing I received all the times was congratulations.”

He said their only warnings to him: Try not to be in the house during another murder.

Despite the murders, Lalo said federal agents told him to continue the drug investigation.

“As I understand things, they said there is nothing we can do now,” he said. “We have to keep going until this matter is in our hands.”

Conrad said he's even more troubled that U.S. officials may have known about the first murder, but let the killing spree continue.

“Here you had the beginning of a chain of events - one murder that led ultimately to 12 that we know of....I don't understand how it could happen,” Conrad said.

"If you authorize it, condone it, or participate in it, you're just as guilty as the one who pulls the trigger or commits the murder,” he said, when shown portions of Lalo’s interview.

ICE officials have declined comment, saying there is an internal investigation into the handling of Lalo.

Federal guidelines prohibit informants like Lalo from participating in any unapproved illegal acts, especially violent crimes such as murder. The guidelines essentially say lawmen and their informants can’t break the law to enforce the law.

Records show Lalo’s role may have involved much more than he admits.

An ICE memo said the informant, in the August death, "supervised the murder and had minimal participation in the act."

When asked about the memo, Lalo denied murdering anyone.

“I’m not a killer,” he said.

However, he said ICE agents told him to infiltrate the Juarez drug cartel.

“When you infiltrate the cartel, everybody knows you have to, to go, like what? Like a criminal,” he said “.....And we discussed that a lot of times, and they say, ‘No, no, we understand.'"

When asked about his role in the August murder, Lalo said he was simply caught off-guard when two Mexican state judicial police followed him to the house.

“In this first time when I saw that killing, what can I do?” he said when asked about the killing. “Call the police? The police was already right there!"

Lalo said the first murder was ordered by cartel lieutenant Heriberto Santillan.

In 2005, Santillan pleaded to criminal conspiracy charges, receiving a 25-year sentence. But five pending murder charges against Santillan were dropped by U.S. Attorney Johnny Sutton of San Antonio.

Conrad said the charges may have been dropped because—in a trial—the government would likely have to call Lalo as a witness. As a result, questions might be raised about the U.S. government’s own actions and oversight.

"There had to be government responsibility there because this continued after the first homicide,” he said.

Once the Santillan case was wrapped up, Conrad said Lalo was no longer needed and the informant became a liability.

Deportation proceedings began.

“[Lalo] can’t talk," he said, referring to several wrongful death civil suits filed against ICE and various federal officials. "That would put an end to, or severely affect, the civil suits that have been filed out in El Paso; and I think it would probably end any criminal prosecutions.”

Lalo said federal officials threatened to deport his wife and children from the United States if he didn’t enter U.S. custody. He said deportation could be a death sentence to them, too.

“They blackmailed me,” he said. “They said you sign to stay here in jail or we’re going to kick out your family.”

For more than a year-and-a-half federal authorities moved him from various jails, supposedly to protect him from a cartel hit. During that time, WFAA-TV asked to interview Lalo - requests denied by ICE. Despite those denials, WFAA-TV obtained a jailhouse interview.

"I want the truth to come out," Lalo said.

He's been held eight months in isolation in various Texas jails from Midland to the Rio Grande Valley.

"The only thing I was allowed to do was to go outside for two hours a week to walk in a little gym," he said.

Transferred to a Midwest jail, he has remained for nearly a year confined with strict phone access.

Lalo said he began working as an informant in 2000, not because he was arrested and needed to "cut a deal" with U.S. officials. Instead, he said he began working because of his convictions to help clean up Mexico.

"And we proved [that] informants are good," he said. "...I mean work produces, gives good results.".

He said his work led to 50 arrests and the seizure of tons of drugs.

But now he sits in jail, fighting deportation. U.S. officials said it is to protect him.

"They say they are afraid I could be killed here," Lalo said. "But they want to put me where they are sure they'll kill me."

E-mail bharris@wfaa.com