A Prince George's County grand jury has indicted a 77-year-old retired engineer from Hyattsville on child pornography and sex offense charges involving 12 adolescent girls. Girls allegedly came to his home, often when they were supposed to be in school, and posed for him and engaged in other activities in exchange for payments ranging from $5 to $200 per incident, according to police.

Law enforcement officials said the man, Horace Davis, a widower who lives alone at 5014 36th Ave., Hyattsville, was arrested on Oct. 13 after county police received a telephone call from a juvenile who alleged that Davis was taking nude photographs and identified some of the girls allegedly involved. Davis was arrested within hours after the telephone call, police said, and was subsequently released on his personal recognizance. Some of the 26 counts contained in the indictment, which was handed down Wednesday, could carry up to 20 years in jail.

Detective C.E. King, who supervised the investigation for the county police child abuse unit, said yesterday that "absolutely no force whatsoever" was involved in the alleged incidents involving the girls. King said that the girls, who attended parochial and public schools in the area, allegedly went to Davis' home because they "wanted money" and a place to stay when they were skipping school.

Davis' attorney, Henri C. DeLozier Jr., said yesterday he could not comment on the charges against his client. Davis, reached by telephone at his home last night, acknowledged that he took nude and seminude photographs of the girls "for my private collection," but he denied that any sexual activity was involved.

"I know that was wrong. I know that was absolutely wrong," Davis said about the photographs. "I never treated them bad."

No charges have been brought against the girls.

"You have to ask yourself who is the victim of the crime," said DeLozier. "You look at this man and you wonder who is taking advantage of whom."

The girls said in police interviews that they used the money paid by Davis primarily for entertainment, King said, including video arcade games and concerts. Sometimes they shared some of the money with friends not involved in the activities, they told police. "Everybody got what they wanted until a couple of the girls started to get greedy" and allegedly threatened to turn Davis in to the police unless he paid them more, King said.

In one incident, according to King, some of the girls rode around in a taxi for a day and then directed the driver to drop them off at Davis' home, where they told Davis to pay the driver's fee, which he did.

Police said that the activity at Davis' home has been taking place for at least three years and involved girls, and at times boys, between 12 and 17 years old. Some of the youths involved have since grown up and left the area, police said.

King said that there is no allegation that Davis left his home to solicit the youths. The police investigation determined that the activity began several years ago with one girl who knew Davis, King said. Information that Davis was paying for the alleged activity was passed around to other girls, he said.

There was no indication that Davis was distributing any of the photographs acquired as a result of the activity, King said, noting that "it was a very, very unusual situation."

According to King, "the kids loved this old man." King said that after Davis' arrest, the youths were "very concerned" about whether Davis would be sent to jail.

Following Davis' arrest, several of the girls allegedly involved in the activity have been enrolled by their parents in counseling programs, King said.

Police said that Davis' home is wired with an extensive burglar alarm system and is in a residential area of brick duplex homes in Hyattsville, about two miles from the District line. Sgt. Laney Hester, chief of the county police child abuse section, said that Davis' home "was basically a crash pad for when you didn't want to go to school."

The blinds and curtains at Davis' home were routinely tightly drawn, police said. According to police, a neighbor once complained to Davis about the large number of people coming in and out of the house.

At the time of Davis' arrest, police said they confiscated what they described as "a vast and extensive" collection of pornographic material, which they estimated to be worth about $30,000, including photographs, movies and magazines. "It's the most extensive collection I have ever seen," King said in an interview yesterday.

Police said that while no force was involved in the activity, the charges were brought under Maryland law, which prohibits certain activites with youths under 14 and 16 years of age.