This is just a link to an article posted on pugetsoundanarchists.org. It is a detailed account of an entrapment-type undercover operation by the police and FBI in Seattle. In a nutshell, an undercover Seattle police officer tries to badger activists into more risky actions, and failing that, entraps one in a drug-deal by appealing to the activist's sense of friendship and loyalty.
The undercover cop pretended to be an activist, initiated conversations about making molotov cocktails and explosives, tried to push people into doing violent and illegal acts, and encouraged the presence of drugs and guns at after-hours parties.
Here is the link to the article (which originally appeared in the Seattle weekly, the Stranger):