Larry Rose was an FBI agent posing as an importer to try and get Russian mobsters to sell him something very dangerous in an FBI sting operation.
Involvement with the Lone Gunmen
The Lone Gunmen sought to learn who had murdered Jeff Strode. They discovered that Strode had a pair of eyeglasses set up as a video camera. It recorded him last speaking with this man, Larry Rose, just prior to his death in the Club Tamarind bathroom.
As the Lone Gunmen looked into all this, their surveillance backfired and got Jeff Strode's sister Carol captured by the mobsters who believed she was Rose's mistress. He did his best to protect her, playing along well that she was the woman he was having an affair with but the Russians were very paranoid and threatened to kill him using a compressed air gun with a tiny amount of Plutonium in it. This final meeting collapsed as Jimmy Bond, disguised as Walter Skinner, intruded into their conversation. Luckily, the club was crawling with FBI agents and success was pulled from the jaws of defeat.
Many people ruined the sting operation that the FBI was working on but this agent was actually the first to screw up. While undercover he contacted his real wife and carried on an explicit conversation with her. Jeff Strode, a hacker, intercepted this conversation and threatened to tell Larry Rose's "wife" who was really his partner in the FBI. Having to deal with Jeff Strode nearly ruined the sting and led to the Lone Gunmen looking into Strode's "death" which further shattered their sting attempt.