Case Dimissed Against Accused Chandra Levy Killer: Part 5

Proller secretly recorded conversations with Armando Morales, who was supposed to testify in Guandique's upcoming retrial.
7:40 | 05/21/17

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Transcript for Case Dimissed Against Accused Chandra Levy Killer: Part 5
Maybe not the first place you'd pick to secretly record a career criminal. But then again, you're not babs proller. So this is the storage facility. And this is the unit that I worked with Armando. Reporter: And you had your recorder on you when you were in here? I did. Right here on the shelf. Reporter: Do you see yourself as some kind of an investigator? Is that what you're out to do? Are you out to get the attention? No. I didn't want to have my name really involved. It wasn't supposed to be exposed at all. I only started taping because I truly was afraid. Reporter: "20/20" has obtained seven hours of conversations between babs and her new friend Armando morales. I got 22 years for gang racketeering. Reporter: The prison snitch so crucial to the Chandra levy investigation. I feel like I'm back on TV like an episode of "House of cards," you know, it's funny. Reporter: The tape seems to reveal that the ex-con Armando morales hasn't forgotten his gangster past. I brought a hoodie, I bought dark clothes. I was ready to confront that . He's not going to get away with that. Reporter: And listen to how he brags about cooperating with law enforcement to put ingmar Guandique away for the levy murder. I'm under the protection of the U.S. Government. I think he was trying to impress an attractive woman. He had been in prison for 20 years. He's about to testify in one of the biggest trials in the united States. And to be talking to a stranger, it was a rookie move for a lifelong criminal. Reporter: When conversation turns to the levy case, morales tells babs what he told the court, that guanidque told him the crime was a robbery gone wrong. It was an accident. He didn't know he killed her. He went back, that was his area to steal and rob. Reporter: Curious, babs starts probing, telling morales she's not convinced the right guy is behind bars. Wait a minute, the dude that I testified, he committed the homicide. Are you sure? Why wouldn't I be sure? People talk. They just brag about stuff to make sure that they look good. I don't know. I can't answer that. Anytime I ask a really detailed question, he would go into, don't go there. He's got other victims. That he killed? Don't go there. It was only skeleton? You said he didn't mean to kill her, he robbed her? Well, no. He's in the cell with me. You think he's going to tell me I meant to do that? Come on. Hello? Duh. Reporter: She says all those evasions make the whole account seem fishy. To me it didn't make sense. I ended up feeling like, you made this up. Reporter: Why would he lie? What was in it for him? He said I wanted protective custody. I no longer wanted to be afraid, because I was always afraid. Reporter: Which is exactly what Guandique's defense attorneys argued in a 114-page filing. Morales had desire for safety from enemies who wanted him dead. Plus, says babs, morales may have hoped the feds might help him to dodge a murder rap of his own back in California. He said in Fresno he was involved in a gang-related murder that they're trying to pin on him but that's being handled. Reporter: Aren't you terrified hearing somebody describe how they killed people? Absolutely. Scared out of mind. Reporter: Morales might be protected by the government, and babs might be in danger. But for whatever reason, she keeps pressing record and keeps pressing morales. Finally, she claims, her persistence pays off. Morales cracks and admits he fabricated Guandique's confession. And then he says, you know what. The prosecutors wanted me to lie. They knew they had the right guy. They just needed somebody to say it. Reporter: He said that to you. Yes. Reporter: And you had that on a recording. Mm-hmm. Reporter: Of course we wanted to hear that part of the recording but get this. After repeatedly assuring us it exists proller has not produced it. The prosecutors have categorically denied what they call "Baseless allegation." Some people would say you have credibility issues. Reporter: Make that legal issues, too. We've discovered proller has a checkered past. The suggestion is that you've had aliases. That you've had sort of a sketchy past, yourself. No. I was married twice. And I'm had my name officially changed after the divorce. Reporter: There was also an accusation of theft. What about the theft? Were you charged? I was charged. Reporter: Enough to earn her three years' probation. Some would say you're a scam artist. True? I have never taken anything from anybody. I have not taken money. What am I trying to scam out of this? Reporter: Okay, maybe it is just a passion for justice which drives her to reach out to Chandra levy's mother Susan. What does she say? Morales lied about Guandique's confession. Reporter: What are you making of this? I thought, oh, my god, this is so weird. Why don't you send a tape for both the prosecutor and the defense team? Send it to them! The prosecutors met with me first. Reporter: They couldn't have liked this. No. No. Reporter: But if the prosecutors listened to the same recordings we did, they didn't hear morales confessing. They heard him sticking to his original story. He told me he didn't know he killed her. It was an accident. He didn't recant his testimony. In fact, he doubled down on his testimony. Reporter: Despite all that, this past July, the bombshell detonates. There is a stunning turn tonight. Prosecutors suddenly dropping murder charges. Reporter: The U.S. Attorney's office drops the case, releasing a tersely worded statement. The office has concluded that it can no longer keep the case. Clearly something occurred which probably eliminated morales as a witness. On those tapes, he brags a lot about his thug life and his life as a criminal. I sent some people to shoot up all the car dealer businesses. Pow! It's a defense attorneys dream come true. It would be a subject of cross-examination and the calculus could have been, "There's just too much baggage for this witness, too many things that he has said and done." Reporter: Whatever proller's true intentions, the Chandra levy case is now in shambles. It fell apart because this woman tampered with the witness. Why did she do that? What was her motive? I felt guilty. I felt really bad about what happened. Reporter: Why? I thought, well, maybe I should not have called this number. Reporter: The levys now have the rest of their lives to ponder the what-ifs. And proller says she's worried that morales will come after her for revenge. His current whereabouts, unknown. My life has been affected negatively. I'm moving from hotel to hotel right now. I'm afraid. Reporter: Why'd you decide to talk with us? I believe that the truth needs to come out. I think somebody out there knows something. I've tried to be brave for all of that. Reporter: Still to come, we've heard from everyone else. Now hear from the man once convicted of killing Chandra levy himself. From now until the end of the year,

This transcript has been automatically generated and may not be 100% accurate.

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