It happens. Interestingly enough, I remember seeing a number of arrests for official oppression among Texas CHL holders in the late 90's. The offenders obviously weren't peace officers (they don't need a CHL), but the data doesn't provide any information about the circumstances.
It's rare that peace officers are prosecuted for this, because it requires a truly blatant and knowing violation of the law. The fact that the officers have been simply indicted indicates that the DA has a very strong case, because he would pursue it otherwise.