Thirty miles off the Virginia coast and 120 feet beneath the sea, the broken hull of the cargo ship Marine Electric lies prey to weekend divers and souvenir seekers, guarding with the bodies of at least three entombed crew members the full story as to why she sank.

The bow of the 605-foot converted World War II tanker lies capsized and fractured; her after-section, toppled to starboard, is half-buried in undersea dune.

More than a mile to the west, gutted of bulkheads and open to the sea, lies the three-cargo-hold midsection, two-thirds as long as a football field and four stories high, colored only by marine growth and rust.

"The amount of damage is among the worst I've ever seen," said diver Jeremiah Shastid of Waldorf, Md., last week after 28 dives on the site. Out of some 300 wrecks he's explored, he said, except for those sunk by explosions "I've never seen a ship so totally torn apart."

Shastid told his story during three days of reconvened hearings as a Coast Guard board of inquiry heard new evidence that the 38-year-old vessel was so weakened by age and corrosion she was literally torn apart Feb. 12 by seas she should have handled with ease.

Caught by a winter storm on the way from Norfolk to Somerset, Mass., with 28,400 tons of coal, the Marine Electric went down amid gale winds and 20-foot seas with a loss of 31 lives.

It was weather she was built to sail through, conditions not unusual for the Atlantic Coast in February, but the 38-year-old ship, "jumboized" to twice her former length by shipyard surgery two decades ago, began losing bow buoyancy and listing ominously to starboard. Finally, at 4:15 a.m. Feb. 12, she capsized, sending all but three crewman to an icy death.

Shastid, a muscular ex-Marine hired by families of the dead crewmen, has dived regularly on the Marine Electric since March. His color photographs show hull plating fractured and creased, hatch covers warped, ballast tanks ripped open and a 26-foot-wide hole hammered or torn in the starboard bow.

He also submitted photos showing one bulkhead where a waterproof door had been cut away in the bow section and another where a corroded interior cargo hatch yawned, frozen open by rust. Surviving crewmen testified last February that rust-weakened exterior cargo hatches and the two inoperable doors left the ship virtually open to an angry sea.

Lawyers for Marine Transport Lines of New York, owners of the Marine Electric, sought to rebut Shastid's testimony by submitting 22 hours of unedited video tape of the wreck taken by a robot submarine and presented to the board without explanation. J.D. Van Rynbach, a naval architect and the company's star witness, said the tapes showed that at least 10 of 34 hatch cover panels on the ship showed no signs of significant weakness.

Company witnesses said, however, that neither the robot nor their own divers had entered any section of the ship itself or sought to verify charges by the three surviving crewmen that the 38-year-old ship was a floating disaster waiting to happen.

Van Rynbach, of Huntington, N.Y., a white-haired Dutch-born naval architect and surveyor, had directed the robot's examination of the wreck and his testimony moved the normally placid board to a rare display of anger.

Van Rynbach, who once helped rule that a Liberian supertanker had broken in two because of crew error, suggested a similar human problem may have contributed to the sinking of the Marine Electric.

Noting that the ship's starboard anchor was found mysteriously missing and a "devil's claw" that helped secure it appeared loose, Van Rynbach theorized that bends and breaks in the ship's hull had been caused not by structural weakness but by the force of the eight-ton anchor "flailing" in the storm.

Capt. Dominic Calicchio, one of three Coast Guard members of the investigating board, appeared astonished by the testimony. He leaned forward and asked the witness "have you calculated how much energy would be required to break the stem of the Marine Electric?"

"No, sir, I have not." answered Van Rynbach.

Under further questioning, he said he had also not calculated such factors as the strength of the ship's hull, the thickness of her steel plating, or the configurations of the anchor chain necessary to cause the fractures shown in the divers' photos. Nor had he reviewed all the video tapes.

"I am convinced as of now that the damage to the ship's starboard bow was caused by the anchor and chain," he said.

Under questioning, he testified that in 32 years as a naval architect and surveyor he had never seen a ship sunk by a pounding anchor. He also said that a watertight Marine Electric should have floated "with ample freeboard" despite cargo holds flooded by the holes in question.

Calicchio pressed Van Rynbach to explain how and why an eight-ton anchor could swing so as to makes holes high up on the ship's side and why the ship's anchor chain stopper--the normal retaining device--wouldn't be enough to hold it in a heavy sea.

Had the chain stop failed, Calicchio said, the anchor and chain would indeed have started paying out and "once it starts running it keeps going--all the way to the bitter end" of the chain.

Rather than stressing the hull, Calicchio said, the anchor would have simply pulled more chain from the ship. Had it done so?

Van Rynbach said he could not answer that question. His expedition, which included seven divers and underwater cutting equipment, had "not been instructed" to enter the ship to learn how much of its 165 fathoms of anchor chain remained, according to Van Rynbach and other witnesses.

James Conway, a former field surveyor in Jacksonville, Fla., for the American Bureau of Shipping, testified that the ship was so wasted by rust in 1980 that he looked up while probing her ballast tanks and saw daylight through the hull.

Conway, whose job was to certify the ship met industry insurance classification standards, said many Coast Guard inspectors ignored such wastage and he himself was asked by his superiors to tone down his criticism of the ship's thinning steel.

But Conway, who suggested but failed to substantiate that his career and even his life might be in jeopardy for disclosing what he knew, said he let the Marine Electric put to sea with hastily welded patches that "leaked like a seive."

"They were in a rush to get out," Conway said. "I was costing them a lot of money. . . . The ship should never have left its last port in that condition."

Conway also testified using ABS documents that the Marine Electric had been surveyed and inspected according to her technical ABS classification as a general cargo ship. An ABS official testified that ships used as bulk carriers should be inspected as bulk carriers and not to do so violates industry safety regulations. Conway tesitified that inspecting the ship as a general cargo ship saved its owners 30 percent in annual survey costs.

Coming less than three years after the 35-year-old freighter Poet vanished with 34 aboard in another East Coast storm, the loss of the Marine Electric has thrown a rare spotlight of public and political attention on a U.S. maritime industry already troubled by age and foreign competition.

In addition to the special panel, convened by the Coast Guard and the National Transportation Safety Board, the House Merchant Marine subcommittee has held hearings into the loss.

The National Transportation Safety Board has already issued one report recommending survival suits be required safety equipment on merchant vessels in winter months. A second report on the sinking is expected in October.

Capt. Peter Lauridsen, chairman of the board, said he hopes the Coast Guard's report will be ready before the end of the year, although the record will be open for new evidence as it is gathered.

Whether any more evidence will be collected is in question. Shastid and other witnesses testified that the propeller of the Marine Electric has already been blasted from the wreck, and diving clubs around Washington are already planning summer trips to the site off the Virginia coast for those seeking souvenirs and profit from the ocean floor.