There's an easy way to tell that you are being set up on a sting: when somebody (especially somebody you know little about) initiates a discussion with you about doing illegal things. Big red flag.
Various LEO organizations have (I would guess) tens of thousands of people running around trying to entrap people. Somebody gets arrested for something, he's offered a deal where things will go easier on him if he helps get evidence on somebody else. Then that somebody else gets offered a deal, and the cycle repeats. That's what the feds tried to do with Randy Weaver in 1992.
Randy Weaver was lured into an illegal transaction by an informant. It is a common tactic.
There is an old joke: How do you tell the FBI informant at the Klan meeting? He’s the guy with the dynamite.