If the other pilots are afraid of an FAA guy coming over to bust on this dude's illegal flight activities, it most likely means that they are operating illegally as well. The FAA isn't the bad guy; they just want to make sure people are operating safely and legally. I've had plenty of dealings with folks from the FSDO (several FSDOs with my moving around the country) from 135 checkrides and renewing my CFI certificates and they've all been reasonable folks.