A State Department officer from Prince George's County was indicted by a federal grand jury in Alexandria yesterday on 27 counts of mail fraud, embezzlement and converting government money on an international black market for his own use while stationed overseas.

Walter F. Costello, a budget and accounting officer for the Agency for International Development, is accused of using government funds to invest in what federal investigators called the Somali black market.

Costello faces a maximum of 235 years in prison and more than $99,000 in fines if convicted on all the charges handed up by the federal grand jury.

The 13-page indictment outlines a scheme in which Costello, who oversaw currency transactions at the government's mission in Somalia, skimmed the difference between the official exchange rate for the dollar and the Somali shilling and a higher rate for U.S. currency on the illegal market.

According to the indictment, Costello mailed about $10,000 in checks that were government property to the United States for deposit into his own accounts at the United Virginia Bank and First and Merchants National Bank. The money was used to "invest in illicit profits and to provide an inconspicuous source of funds to purchase shillings from Somalian foreign nationals," according to the court papers.

Assistant U.S. Attorney Clarence H. Albright Jr. said yesterday that the scheme involved "no monetary loss to the government" because Costello returned the money to the government's account after allegedly making a profit on it in the illegal market.

Costello, whose address is listed on court documents as 6602 District Heights Parkway, District Heights, has been on administrative leave for a year, Albright said, and has not worked overseas since 1980, when the agency first began investigating charges against him.

He is scheduled to appear in court on the charges Dec. 26.