...A 2005 report published by the Northwestern University School of Law traced the first documented use of "snitch testimony" in the United States to 1819, when the state of Vermont convicted Jesse Boorn for murder based on testimony from his cellmate. The cellmate told a judge that Boorn confessed to the crime inside their jail cell while awaiting his trial. In exchange for testifying, the cellmate was freed after Boorn's trial, and Boorn was sentenced to the gallows.
This basic reward system underpinning jailhouse informant testimony persists into the present day. It's not difficult to imagine why a prisoner informant would lie about overhearing a confession if it means real material benefits.
"Informants lie primarily in exchange for lenience for their own crimes, although sometimes they lie for money," according to a report from Golden Gate University Law Review. While informants are motivated to falsify testimony for material reward, prosecutors are often motivated to make those informants sound believable to a judge. Testimony from a single jailhouse informant is enough to convict a person for a charge as serious as murder, according to Valerie Newman, assistant defender in Michigan's State Appellate Defender Office.