HOT MONEY AND THE POLITICS OF DEBT By R.T. Naylor Linden Press/Simon and Schuster. 463 pp. $18.95

AS CONSPIRACY theories go, here is one that is truly elegant. It involves everybody -- the CIA, the IMF, the big international banks, the Vatican, Switzerland, Meyer Lansky, Bernard Cornfeld, Luxembourg, and the Unification Church, to name but a few -- all playing a dirty global game of take the money and run.

The object of this game, which R.T. Naylor calls "peekaboo finance," is to move billions of dollars in "hot and homeless money" from haven to haven around the world, always leaving tax collectors and other authorities one step behind. The money is "flight capital," on the run from social unrest or poor economic conditions, from law-enforcement agencies, or from governments that want to press it into low-yielding service to the poor. But whatever the reason for its flight, it is money whose proper owners have lost control of it.

But peekaboo finance is more than just a matter of international cops and robbers, according to Naylor. It is a mechanism that has allowed a small number of greedy men to loot and all but destroy the economies of most of the world's developing countries. The debts run up by these countries were meant by the borrowing governments to provide capital upon which to build economic growth. But corrupt officials at home, with the connivance of an equally corrupt international banking system, have spirited it away into hidden accounts abroad, leaving debt and impoverishment behind.

Indeed, Naylor contends, this monetary exodus is at the heart of the financial problems facing the Third World. "There would be no 'debt crisis' without large-scale capital flight," he says. The blame, he believes, lies squarely at the door of the big international banks, which are heavily involved "in the fomenting of, and profiting from, capital flight." He continues: "That bankers periodically open their front doors to delegations from developing country governments in search of loans to replenish foreign-exchange reserves while their back doors are never closed to flight capital -- which will then be 'recycled' to the countries of origin -- borders on the obscene." "The U.S. government at least tried," he adds, "to put Meyer Lansky in jail for doing something similar." The conclusion he draws from all this is that the Third World debt is not "legitimate" and thus can and should be repudiated by the debtor nations.

He recognizes that this could cause "massive insolvency of major international financial institutions," collapse of trade and ultimately either a world depression or hyperinflation. But he sees a way around that. When Bernard Cornfeld's international mutual fund, Investors Overseas Services, collapsed in the early 1970s and the Nugan-Hand Bank of Australia failed in 1980, these havens of hot and homeless money were found to have substantial assets that no one would come forward to claim.

From this and from discrepancies in world balance of payments figures that are estimated at as much as $100 billion, he infers that most major international financial institutions possess substantial deposits that no one would dare admit to owning. If these deposits were seized, the depositors would be in no position to complain. "Flight capital appearing on a bank's balance sheets is, in accounting terms, no different from other deposits. But, as some of the banks came to realize, it does not always behave like other deposits. It is . . . de jure a deposit but de facto part of the capital of the banking system" and fair game for seizure to offset default on debts that it helped cause. This "augmented capital" thus "provides a major cushion against which bad debts can be written off without imperiling the the solvency of the banking institutions." And "if those bad debts are those that the debtor countries can identify as illegitimate -- deriving from phony invoicing or the looting of the national patrimony by persons enjoying power without responsibility, or caused by the need for borrowing to offset the drain from capital flight -- the circle is complete."

IT'S AN ingenious theory. But like most conspiracy theories, it requires a leap of faith to get from the evidence to the conclusion. But if Naylor, an associate professor of economics at McGill University, isn't entirely convincing, he is both entertaining and thought-provoking. In an effort to demonstrate that international finance provides both motive and opportunity for the looting of developing countries, he takes a highly readable tour of the major financial crimes and scandals of the past 20 years. He traces international financial scams from mobster Lansky in the '40s, through Cornfeld's IOS in the '60s and '70s, to Michele Sindona and the Vatican through to the enterprises of the Rev. Moon and the operations of various offshore banking havens.

He leaves no doubt that there is a lot of hot and dirty money around and that it would be harder to shuffle around without the banks. But the book kisses off the policies and problems in the Third World that cause capital to flee. By and large, money does not run from favorable economic conditions, and absent those it will find a way, banks or no banks.

Further, Naylor shows no interest in the long-term impact that his solution would have on international lending. If it became acceptable for borrowers to decide after the fact that the loan was immoral and thus carried no obligation to repay, the Third World would have to learn to live without credit.

The book provides plenty of comfort for people who believe that most of the world's problems are caused by a small, definable group of bad guys. Unfortunately, it's not that simple, and Naylor's proposals, if actually implemented, would cause more harm than good. :: Albert B. Crenshaw is national business editor of The Washington Post.