CARENCRO (AP) — A police chief disputes claims that his officers were paid to look away during illegal drug sales and prostitution at a strip club.

Carencro Police Chief Carlos Stout told The Advocate (http://bit.ly/16vPR3T) that officers were allowed to work at Desperado’s Gentlemen’s Cabaret with the understanding that they had to stay in the parking lot unless there was a disturbance inside.

A federal indictment unsealed Wednesday said that owner James Panos “made special arrangements with some local police officers” so illegal drug sales and prostitution activity could continue unfettered at the club, which featured nude dancers.

“It’s been made to believe, what’s been put out there (by the U.S. Attorney’s Office), is that we didn’t enforce the law there,” Stout said. He said that’s not true, citing “numerous, numerous arrests” by officer at Desperado’s,

The indictment charges Panos, his wife, and eight others with drug, racketeering and conspiracy crimes. The 19-page indictment paints a portrait of rampant illegal drug sales and use, and of women in the club available for prostitution.

Stout said he became police chief in January 2003 and “immediately” put a stop to officers working at Desperado’s because he thought it was unbecoming that officers wearing a Carencro police uniform were seen working inside the club.

Lafayette Parish sheriff’s deputies are barred by department policy from providing security at a business that derives more than half its income from alcohol sales. Lafayette city police aren’t allowed to receive direct payment from bars, and can’t work security jobs outside the city.

Stout said Panos convinced him the club needed security, and by June 2006 Carencro officers again were allowed to earn extra money provided they stayed in the parking lot and entered the bar only when needed.

A memo written by Assistant Carencro Police Chief Darren Gravouia and dated June 5, 2006, chides Carencro police officers who worked at Desperado’s and were caught inside.

Stout said Desperado’s employees paid officers their $20-an-hour wages out of the cash register. Stout said the officers signed a time sheet and had to pay taxes on the earnings.

Stout also said his men never mentioned to him the drug sales and prostitution alleged by federal prosecutors.

He said he knows people who had frequented the club before it was shuttered in December.

“A lot of people told me, ‘Man, this open-air (drugs and prostitution) market they’re talking about,’ they said, ‘it never happened,’ ” Stout said.