VANCOUVER -- An undercover terrorism sting involved thousands of dollars changing hands and officers claiming access to guns and explosives, but the lead officer insisted repeatedly in court on Wednesday that the operation was in no way meant to appear criminal.

RCMP Sgt. Bill Kalkat told B.C. Supreme Court that officers never explicitly told John Nuttall he was consorting with a jihadist terrorism group or any other criminal organization.

Nuttall and his wife Amanda Korody were found guilty last June of plotting to blow up the B.C. legislature on Canada Day 2013. No conviction will be entered until a judge decides if police entrapped the pair.

"Mr. Nuttall and Ms. Korody were free to come to whatever inference or decision they wanted. We didn't persuade them or dissuade them one way or another," Kalkat told the court.

"Nuttall might infer that it's a criminal organization. I don't know what he's thinking."

Nuttal and Korody's lawyers are arguing police manipulated the pair into carrying out the terrorist act.

Early in the undercover operation, Nuttall was paid $200 to take an unmarked package to a transit-station locker in downtown Vancouver.

He was later directed to transport another parcel, this time taking a circuitous transit route and leaving the package in the trunk of an unlocked rental car.

"Would any of that behaviour be consistent with the notion that the package is legitimate and legal?" Korody's lawyer Mark Jette asked.

Kalkat admitted it's possible to interpret the operation as illegitimate but emphasized that Nuttall was always informed the contents of the packages were legal.

Another scenario involved officers engaging Nuttall in a "loyalty talk" before showing him $20,000 in cash being exchanged between undercover officers and talk of a commission.

"I'm going to suggest to you that you designed it that way because you wanted Nuttall to believe that (the primary undercover officer) was engaged in nefarious, probably illegal activities," said Jette.

"No, not that he's engaged in nefarious activities, but that he does have contacts and that he's engaged in business and that he has a source of income," Kalkat replied.

Kalkat explained that Nuttall could have interpreted the exchange as hawala, an informal system of transferring large sums of money for a commission, which the officer said was common practice in India and the Middle East.

"Really?" Jette asked. "Do you have any information that would lead you to believe that Mr. Nuttall was aware of underground Indian banking systems?"

"It's possible," Kalkat replied. "Mr. Nuttall has extensive, in my opinion, knowledge of some of the Middle Eastern practices."

"You really thought that Nuttall would put all those pieces together?" Jette said. "John Nuttall? Really?"

"Yes, I did." said Kalkat.

Earlier in the day, Kalkat said he "absolutely" urged his officers to consider the fact that Nuttall appeared developmentally delayed, telling the court that police scenarios were designed to take Nuttall's mental capacity into account.

Kalkat also said he was aware as early as March that the Canadian Security Intelligence Service, Canada's spy agency, had been conducting its own surveillance of Nuttall.