David Fagan, 53, allegedly used a website to begin talking to the woman as he tried to find young victims.
She told him she was a 40-year-old woman from London with three children and was now a lesbian.
The woman told him her children, a boy aged 10 and two girls aged 12 and 14, had previously been abused by another man she had also met online.
Fagan, who was going by the username MrMaster641 online, is said to have asked for dates when he could travel down south and also described what he allegedly wanted to do to the children.
The woman said it would cost Fagan £100 to come to her house.
Fagan, of Airdrie, Lanarkshire, is on trial at the town’s sheriff court where he denies sending messages in relation to incest, the sexual abuse of children and the rape of a child.
He also denies conspiring to meet a 14-year-old girl for sex while another girl, aged 12, was present.
It is further alleged he sent electronic messages with “matter that is grossly offensive or of an indecent, obscene or menacing character” between May and August 2016.
A jury has heard Fagan was talking to an undercover 45-year-old female detective constable, who cannot be identified for legal reasons and was working in a secret location.
They heard transcripts of private Skype messages which prosecutors claim show Fagan was actively looking for children to abuse.
Under questioning from deputy fiscal Liam Haggart, the officer, who gave her evidence from behind screens, told the court she believed Fagan was a ‘high risk’ to children.
She said: “I go to a secure building where I pretend to be someone, I create an online persona.
“I set up a profile to speak to people who want to sexually abuse children.
“I was tasked to contact this man because my colleague had spoken with him previously and I sent him a message to the MrMaster641 account.
“I got a response saying he was a 52-year-old man living in Glasgow but that he visited London sometimes for business.
“He was talking about raping the older child while I sexually abused the youngest child.
“He said he was looking for a conference in London where he could come down and sexually abuse the children, talking about raping a 14-year-old girl.
“I checked and double checked with him, he was going to come to London, he had agreed a price with me and there was a number of things that I wanted to ensure what his intentions were because that is my job.
“He didn’t sound like a fantasist to me.
“Everything he was saying to me showed he was intent on coming to London to abuse children.
“I ended our contact because he was regarded as such a high risk to children.
“He wanted to wait to October or November before coming down but we couldn’t wait that long because of what he had told me.
“He is someone who wanted to go and sexually assault children.”
Fagan was a councillor in North Lanarkshire until the local elections in May 2017.
The trial before Sheriff Frank Pieri continues.