IN JANUARY 1977, the United States government accused a Chicagoan named Frank Walus of having committed atrocities in Poland during World War II.

In the following four years, this retired factory worker went into debt in order to raise more than $60,000 to defend himself. He sat in a courtroom while 11 Jewish survivors of the Nazi occupation of Poland testified that they saw him murder children, an old woman, a young woman, a hunch-back and others. He lost most of his friends. He was vilified by the press. A court found that he did commit war crimes. He was stripped of his U.S. citizenship. He seemed about to be deported, probably to a country where he would be tried for war crimes.

But then, two years after he was convicted, a court of appeals said it would be "an intolerable injustice" not to retry Walus and that a new trial "almost certainly" would clear him. Nine months after that, charges against Frank Walus were dropped.

Overwhelming evidence shows that Walus was not a Nazi war criminal, that he was not even in Poland during World War II. Much of this evidence was available to the U.S. government before Walus was even charged, long before he was brought to court. Yet it was not until after the court of appeals ordered Walus retried that the government actually investigated the evidence favorable to Walus. Incredible as it may seem, neither the government nor the judge who heard Walus' denaturalization proceeding seemed to be interested in whether Walus actually was guilty or not. It seemed enough that he had been accused of having been a Nazi.

The Walus case was a kind of witchhunt -- though for "witch," substitute "Nazi." This is not to say that there are no former Nazis living in the United States. Nor does it mean that any former Nazis who do live here should not be deported. It means that, in an atmosphere of hatred and loathing verging on hysteria, the government persecuted an innocent man. And we should be concerned about that, too.

Frank Walus was born Franz Walus in Germany in 1922. His parents were Polish and thus, under German law, he is a Pole. He lived in Germany until 1932, when his father died and his mother moved near Kielce in Poland, where Walus was known as Franciszek.

In September 1939, the Germans invaded Poland. On March 2, 1940, Franciszek Walus and a number of other Polish youths were rounded up and sent to Germany where they were among the 2.5 million Poles who worked virtually as slaves for the Germans during World War II. Walus was 17 years old. He proved too frail to do the work the German farmers demanded of him; although they were fond of the boy, they traded him for laborers who could do more work. Walus spent most of the war being shifted from farm to farm in the area around Neu-Ulm, Germany.

While Walus was in Germany, the Nazis established ghettos for Polish Jews in Kielce. These ghettos were under the control of the Nazi Schufzstaffel, or SS -- of which the Gestapo, or secret police, was the elite corps. In 1942 and 1943, both ghettos were "liquidated." First women, children and men unable to work were sent to concentration camps. Later the remaining Jews were sent to the camps.

When the war ended in 1945, Franz Walus enrolled in various Allied civilian units in Germany. In 1947, he returned to the area around Kielce and lived there without incident for 10 years. Ultimately, he and his wife came to the United States and to Chicago. Walus Americanized his first name, worked in a factory, bought a neat duplex on Chicago's southwest side. In 1970, he became a naturalized citizen.

In 1971, Walus gave lodging to a Polish immigrant named Michael Alper, a Jew who was raised as a Roman Catholic after his parents were killed by Nazis. Alper resided with Walus until 1972, then left the Walus home, then returned with his new wife in March, 1973. In May, Alper and Walus quarreled because Walus accused Alper of cheating another man of some money. Walus then threw Alper out of his house.

A year later, in 1974, Alper told a Chicago Jewish agency that, while he lived with Walus, Walus had told stories of having colaborated with the Nazis in Poland during the war. Ultimately, Alper would testify to the same thing as Walus' trial, and Alper's wife also would testify that Walus told stories of committing atrocities. But neither would explain why they waited so long to come forward with their allegations.

The U.S. Court of Appeals for the Seventh Circuit would say, "The evidence of hatred between the defendant and the Alpers was extremely strong," and it would conclude that the Alpers' testimony was not credible. But by that time it would be very nearly too late.

In 1974, Simon Wiesenthal, the famous "Nazi hunter" of Vienna, denounced Walus as "a Pole in Chicago who performed his duties with the Gestapo in the ghettos of Czestochowa and Kielce and handed over a number of Jews to the Gestapo."

Wiesenthal did not say on what basis he made this denunciation. He says that Michael Alper was not his source, but he will not name anyone else. Did he check on his source before he accused Walus? There is no evidence of it. No documents ever have been produced against Walus, and all the witnesses against him were found after 1974.

In 1974, Rep. Elizabeth Holtzman (D-N.Y.), a member of the House immigraiton subcommittee, began a campaign to get the government to investigate "allegations that there were Nazi war criminals living in the United States." In a subcommittee hearing in April 1974, Holtzman grilled the immigration commissioner about charges that the Immigration and Naturalization Service knew about Nazi war criminals living in the United States and had done nothing about it. In May 1974, she issued a report calling for an overhaul of efforts against Nazi war criminals and the creation of a special war crimes task force within the Justice Department.

The INS seems to have given Wiesenthal's accusation, the name Frank Walus and a photograph of Walus taken in 1959, when he was 37, to the Israeli police. The Israeli police apparently then gave Walus a promotion: Although Wiesenthal had accused Walus of collaborating with the Nazis, the Israelis decided that Walus had been a member of the Gestapo.

In so doing, they neglected some important details. One, they forgot or didn't know Walus' height. He is small-boned and stands 5 feet 4 -- too short by two inches to have been allowed into the Gestapo. Two, they forgot or didn't know that the Germans considered Walus a Pole. Poles were not allowed to join the Gestapo. Three, they forgot or didn't realize that Walus had Americanized his name to Frank when he entered the United States. His lawyer would present testimony at Walus' trial showing that "Frank" is not a first name in Germany or Poland; it is a last name, and it is pronounced "Fronk."

Finally, it does not seem to have occurred to anyone -- Wiesenthal, the INS, or the Isaeli police -- to ask Walus where he was during the war and then check his alibi.

The Israeli police placed an advertisement in an Israeli newspaper seeking witnesses to crimes committed in Czestochowa or Kielce by a Gestapo officer named Frank Walus. Two future witnesses responded to this ad. Three more witnesses were located by telephone by an Israeli police inspector who mentioned the name Frank Walus to at least two of the witnesses and Czestochowa and Kielce to two of the witnesses. At least one other witness was given the name of Frank Walus and the names of the towns in which the war crimes allegedly were committed. Several of these witnesses later said that they knew Walus as a Gestapo officer called Frank. None of the witnesses who referred to Walus by name remembered him as "Franz" or "Franciszek."

The Israeli police showed potential witnesses eight photographs, one of which was an enlargement of the photo supplied by the INS, which showed Walus 20 years after the crimes he was accused of were committed. The appeals court would describe this photo as "light and grainy in appearance, and [showing] little shading of the defendant's facial features. In fact, the outline of the defendant's face is barely visible."

Of 44 potential witnesses to whom the photographs were shown in Israel, eight would "identify" Walus at the trial. One of these would testify that, when he could not identify Walus from the spread of eight photographs, the Israeli inspector showed him only Walus' photograph. When he still couldn't identify Walus, the inspector told him that the man in the picture was Walus.

The court of appeals would say that the methods used by Israeli police to obtain witnesses against Walus were "questionable" and "suggestive."

The INS apparently did not get directly involved in the Walus case until January 1976. Still under pressure from Holtzman, the INS sent investigators to Israel to gather material to be used in denaturalization and deportation hearings against alleged Nazis. The investigators do not seem to have questioned the methods used by the Israeli police in the case. Nor were they deterred when a search of European archives turned up no evidence that Walus had been a war criminal, that he had been in Poland during the war, or that anyone named Frank Walus had belonged to the Gestapo.

So far, seven people had identified a "barely visible" image of Walus' face in a 20-year-old photograph as a picture of a Gestapo murderer they had known 35 years before. (One Israeli witness would not "identify" Walus until the trial.) That was the sum total of the evidence against Walus in 1976.

But, in 1976, the public approached a state that can only be described as Nazi-mania, American Nazis were threatening to march in the largely Jewish Chicago suburb of Skokie, where many concentration camp survivors live; the American Civil Liberties Union's decision to defend the Nazis' right to march was the subject of angry controversy.

Toward the end of 1976, the Israeli government leaked to a Chicago Daily News correspondent a list of 89 war crimes suspects. Walus' name appeared on the list along with the names of more than 10 other Chicago residents. The Daily News then began a highly touted "series of exclusive reports revealing war crimes allegations against more than 10 Chicago-area residents." On Jan. 8, 1977, the banner headline on page 3 was "Nazi Jew Killer Living on SW Side?"

The story quoted two eyewitnesses who described in gruesome detail the atrocities Walus -- called "Fritz Wulecki" in the story "to avoid any possibility of prejudicing the ongoing federal investigation -- was supposed to have committed. These allegations were printed without direct challenge, but Walus' claims of innocence were characterized as "conflicting" and "contradictory." An Israeli Ministry of Justice attorney was quoted in the story, saying that the case against "Wulecki" was "airtight."

Eighteen days later, when charges were brought against Frank Walus, everyone recognized him as "Wulecki."

Walus was at home that day. He heard his back doorbell ring. He opened the door to two men, one of whom asked, "Are you Frank Walus?" When Walus said yes, one of the men thrust a bundle of papers into his hands and said, "Mr. Walus, you have 60 days' time." Then, Walus says, the men ran away.

Walus was charged with having concealed his war crimes from the government when he applied for citizenship. He had 60 days to answer the charges. This was the first formal opportunity he had been given to do so.

The government also had thrust the burden of paying for an investigation onto Frank Walus. From now on Walus would pay and pay for lawyers' fees and other defense expenses. The quality of the defense Walus could present always would be limited by how much he could afford to spend.

Fortunately, Walus asked a former alderman for help. The former alderman recommended that he talk to his cousin, a neighborhood lawyer named Bob Korenkiewicz.

Korenkiewicz did not believe Walus' story immediately, of course. Indeed, one of Walus' many problems throughout the case was that he did not present himself well to strangers: His unflattering crewcut and his heavy accent were his first liabilities. In addition, Walus tended to become agitated when trying to defend himself -- to little avail -- to reporters.

But Korenkiewicz took the case. He went to Germany for three weeks to look for evidence, accompanied by John Gubbins from the U.S. attorney's office.

According to Korenkiewicz, the two attorneys were met at the airport in Germany by a U.S. Justice Department official who told them that German records contained no information on Walus. Gubbins says he believed this. Korenkiewicz searched the records anyway, but initially found nothing.

Korenkiewicz also went to the German farms where Walus had lived during the war. The farmers, he says, "were country bumpkins. These people called Walus, 'Franzl,' which is the diminutive of Franz. There were tears in their eyes. They showed me the bedroom he slept in, the farms he worked on. They were small town people, open, honest, living in the community for generations." Korenkiewicz decided that these people could not be lying to protect Walus. From that moment on, he says, he believed Walus innocent.

The government apparently never did any further research in Germany. But Korenkiewicz, after finding no documents himself, hired a Munich lawyer who found documents U.S. government officials apparently missed. These were documents from the German "AOK," the national health insurance system established in the 19th century by Bismarck, that showed that Franz Walus was a farm worker in Germany from 1940 through the war.

By October 1977, Korenkiewicz had compiled the following evidence of Walus' innocence, which he appended to a motion asking that the charges against Walus be dismissed:

AOK documents dating from March 8, 1940, to June 1945 showing that Walus was where he said he was during the war.

A letter from Arolsen, the international tracing organization established by the Red Cross after the war, corroborating the AOK documents.

A letter from the Berlin Document Center, the repository for masses of Nazi documents captured by the Allies at the end of the war, stating that the center had no record of a Frank or Franz or Franciszek Walus working with or for the Gestapo.

Eleven affidavits from people in Poland who knew Walus before 1940, who stated that they had never seen Walus in a German uniform and had no knowledge of him being a Nazi collaborator.

An affidavit from the Rev. Franciszek Tomczyk stating that he had been Walus' teacher before March 1940, and that he knew nothing about allegations that Walus was in the Gestapo or SS, Tomczyk, who was the Kielce parish priest, added that when Walus moved back to the area after the war, Polish underground troops were operating in the vicinity, "so if Walus had collaborated with Gestapo, he would have been dead now."

Evidence that the minimum height of members of the German SS was 5 feet 6 inches, while Walus is 5 feet 4.

In addition, the government knew that witnesses in Germany were prepared to swear that Walus lived with them during the war.

On its side, the government had been able to locate no documents. They had, however, located four more witnesses, all in the United States. Two identified Walus from a spread of photographs containing a photo of Walus taken in 1962, clearer than the one used in Israel. A third witness was a Chicago-area man who said he recognized Walus on the Chicago El as someone he knew from Czestochowa, but only later connected him with the Gestapo. This man also "identified" a 1959 photograph. The court of appeals would call these identifications "less questionable" than those by the Israeli witnesses.

Korenkiewicz was "surprised" that the government did not drop the charges against Walus. He was even more surprised, however, when the government did not bother to investigate any of the evidence of Walus' innocence, especially the documents from the AOK. After all, the standard of proof in a denaturalization case is that the government, not the defendant, must present "clear, convincing and unequivocal evidence." To Korenkiewicz, this meant that the government would have to prove that the AOK documents were fakes.

But the government did not see it that way. John Gubbins says now that he assumed then and, in fact, still believes that the AOK documents were "made after the war" to provide an alibi for Walus. Yet he never provided any evidence at the trial to show that Walus could have arranged for such forgeries or even that the Nazis were in the habit of creating such forgeries, particularly for low-ranking members of the Gestapo such as Walus is alleged to have been. The argument the government would present at the trial would be that Walus' documents "could" be fakes. Also that all the documents showing Walus to have been a war criminal "could" have been destroyed. And that all of Walus' witnesses "could" be lying to protect a fellow Nazi.

This infuriates Korenkiewicz. "We show proof at trial," he says. "If the government shows a document against my client, I don't say, 'Judge, that could've been made last week.' I show proof that the document is not what it purports to be. Everything 'could have.' The big 'could have' is, my client could have been the little mopsy farmworker he said he was. But nobody seemed to give that any credence at all."

By then it was probably too late to give credence to Walus' evidence. Somehow, a terrible momentum seemed to have built up for this case. Possibly the prosecutors were incapable of admitting, even to themselves, that Walus might be innocent. The public had been promised a Nazi. Walus was it.

So in late March 1978, a little more than a year after charges were brought against him, Walus came to trial in Chicago. The security -- metal detector at the door, armed guard at the elevator -- was said to be the strictest in the history of the federal court. The press had been building toward this sensational trial for months, and now the benches filed with spectators who were sure of Walus' guilt and loathed him. "This courtroom is full of blood. There is no question of his guilt. There is blood all over him," a woman spectator told a reported. She came to the trial every day.

Now Walus was about to have his final stroke of almost incredibly bad luck. At his judge in this case, Walus drew none other than Julius Hoffman, of Chicago Seven fame.

Korenkiewicz had heard the stories about Hoffman. But he had no inkling, until the first day of trial, of how badly Hoffman can behave. Late that afternoon, Korenkiewicz came forward to cross-examine witness David Gelbhauer, an Israeli who testified that, while working in Gestapo headquarters in Czestochowa, he had seen Frank Walus shoot a young, pretty Jewish woman. Then, when two children with the woman began to cry, "Walus" shot them too. Gelbhauer made this identification in court entirely on the basis of Walus' face; he did not see Walus standing up. He did not hear Walus' voice.

Korenkiewicz moved to cross-examine Gelbhauer on his ability to identify the man he had seen 35 years before. Korenkiewcz asked Gelbhauer how tall this man was.

Gelbhauer answered, "Sort of middle height, not too tall and not small. I know he is a bit taller than me." Gelbhauer then testified that he is 5 feet 5 (an inch taller than Walus.)

When Korenkiewicz asked the witness to "be more specific" about the height difference, Hoffman stopped the questioning, calling it "an absurdity. . . . I couldn't tell you," the judge continued, "how much taller you are than I or how much taller I am than you. I don't know that you are even taller than I am." Korenkiewicz is six feet tall, roughly six inches taller than Hoffman.

Later Gelbhauer would say that he didn't like to look at "Walus": "I tried not to see him. I tried to avoid him as one avoids a dog."

Although Hoffman all but refused to let Korenkiewicz cross-examine the government witnesses, Korenkiewicz had to sneak into the record evidence that these 11 witnesses could not really remember the man who had tormented them so many years before -- if, indeed, all 11 even remembered the same man.

The next witness, who said Walus shot a lawyer, said the killer was of "middle height, medium height" and "slightly shorter" than 5 feet 10 inches. He also said the man was "medium built" and had light brown hair.

A third witness said Walus herded a group of children into a building, whereupon she heard screams, then silence. She testified that the murderer was a little shorter than 5 feet 6, and "broad shouldered."

The fourth witness said Walus shot three people in 1942, as the Jews of Kielce were removed to camps -- an old woman, a hunchback and an emanciated man. He described the killer as "middle size, not tall" and "about a head smaller" than 5 feet 10. He said the man was "approximately 25, 26" years old. (Walus would have been 20 in 1942.) This witness said, "I never looked in his eyes. I was afraid to look in his eyes."

None of the witnesses was able to give a detailed description of the man in question: Their descriptions frequently did not agree with one another, let alone with the physical description of Frank Walus, seated in the defendent's chair. Not one, before identifying Walus as a murderer, asked to see him stand up, move or turn his head. Not one asked to hear him speak. The appeals court would find that at least five of the witnesses made their identifications exclusively on the basis of Walus' face.

Throughout this testimony, however, Chicago newspapers prominently featured the witnesses' sensational testimony. The discrepancies revealed by Korenkiewicz during his attempts at cross-examination were usually not noted. Nor was Hoffman's obvious bias against Walus. This was particularly true of the Chicago Sun-Times, which had picked up the cudgel against Walus after its sister paper, the Daily News, folded.

At the end of the government's case, Korenkiewicz made what he knew was a doomed request that Hoffman dismiss the charges. Hoffman ruled that "in the opinion of the court . . . the defendant did commit war atrocities." Hoffman had not heard a single defense witness when he all but pronounced Frank Walus guilty of war crimes.

Korenkiewicz brought Walus to the stand to testify through an interpreter about that critical period during which he worked on German farms, when the government claimed he was committing atrocities in Poland. The Sun-Times coverage of the Walus case, which so far had played regularly in the first few pages, suddenly appeared on page 28.

Gubbins cross-examination Walus for nearly two days -- according to the Sun-Times, "hammering away" at "inconsistencies" and "contradictions." But Walus' attempts to explain his testimony were foreclosed by Hoffman, who repeatedly instructed him to answer only yes or no to prosecution questions. If Walus did not, Hoffman said, he would make Walus leave the stand and would strike his entire testimony from the record.

The court of appeals would later determine that the inconsistencies in Walus' alibi were "not significant."

Walus had about $6,000 left with which to bring witnesses from abroad. Korenkiewicz could afford to bring only six people. "If we had only had $1,000," says Korenkiewicz, "we would have had to find the one best witness."

They brought Wilhelm Rehle, and AOK employe since 1956, who testified that AOK documents substantiate Walus' story. They brought Margarita Heichlinger, an AOK employe since 1941, who testified that she posed the entries on the AOK cards, usually within days of receiving information from an employer. She recognized her own handwriting on some of Walus' cards. They brought three farmers to testify to Walus' presence in Germany from June 1940 to the end of the war and another witness who knew Walus in 1941. Another farmer testified by deposition that Walus had worked on her farm from March to June 1940, and Father Tomczyk also testified by deposition.

In cross-examination Gubbins and his assistant, William Conlon, made much of inconsistencies that the court of appeals would later call "inconsequential" and "minor." Gubbins and Conlon also made much of the witnesses' Nazi ties: The three women farmers were widows of Nazi party members. Heichlinger's father had been a member of the party. Stolz had been a member of the Hitler Youth. The appeals court would "emphasize" in its opinion "that the sympathy for Nazi tenets shown by this evidence can only be very slight."

In May, no one was very surprised when Hoffman found against Walus. Hoffman said Walus' testimony and that of his witnesses and Walus' documents were full of "inconsistencies." On the other hand, the testimony of government witnesses "was generally consistent . . . both powerful and largely unshaken by able cross-examination."

On the troublesome matter of Walus' height and build, Hoffman had this to say: "To several people, a person in uniform, especially one in Gestapo uniform, unavoidably takes on a more imposing, and thus somewhat larger and more mature appearance."

Neither the government nor Hoffman could explain how Walus could have created the AOK documents. The government had suggested the possibility of a "Nazi cover-up" after the war, but not even Hoffman was persuaded of this: "The court does not find that hypothesis to be supported by the evidence."

"How the documents were generated was not established," said Hoffman. "Their origin is, however, of no importance.

Shortly thereafter, a French citizen named Andre Bosserdet read about the Walus case in a newspaper. He had been a prisoner of war in Germany, where he knew Walus between 1941 and 1942. He came forward.

In October 1978, through the efforts of Walus' father-in-law, who lives near Kielce, five more Polish witnesses were found. They had been forced laborers in Germany during the war, where they knew Walus.

In addition, the German government discovered residency documents, attached to a picture of Walus, showing that he lived in Germany from March 1940 to an indefinite date. The new documents corroborated the AOK documents "almost perfectly," according to the appeals court.

On Oct. 30, 1978, Korenkiewicz presented the additional evidence to Hoffman, asking that Hoffman vacate the judgement against Walus. Hoffman turned him down.

It took until February 1980 for the court of appeals to review Walus' case and order him retried.

The appeals court called the government case against Frank Walus "weak." The court said that the trial record "suggests that the strength of the government's case is at least partly the result of the trial court's [Hoffman's] frustration of defense attempts to cross-examine witness."

The court called Walus' documents "compelling." "The government has had little success in impeaching Walus' documentary evidence, which corroborates his testimony closely," said the court.

The court said that Hoffman had accepted the statements of government witnesses without question, but had engaged in "unrestrained and almost irreconcilable reliance on bias" in deciding to discount testimony from defense witnesses.

Only now did the Walus case receive a full investigation from the U.S. government. The investigation was conducted by the Justice Department's new Office of Special Investigations, begun at the instigation of Elizabeth Holtzman and charged with the sole duty of finding and deporting Nazis living in the United States.

For the first time, the government now obtained the AOK documents, submitted them to chemical and handwriting analysis, and found "that they were genuine."

For the first time, the government got cooperation from the active war crimes commission in Poland. The Office of Special Investigations checked the commission's archives, which contain records from Kielce and Czestochowa, and found no record of a Walus accused of having been associated with the Gestapo. Nor did they find any evidence Walus was in Poland during the Gernam occupation. A search for witnesses and a review of regional archives also produced nothing.

The office also interviewed Walus' new witnesses and examined the new documents showing that Walus lived in Germany from 1940 on. In the United States, the office interiewed "dozens" of former residents of Kielce and Czestochowa and showed them photo spreads in which Walus' picture was included. This time no one identified Walus as a former war criminal.

The government now reinterviewed "many" of the witnesses who testified against Walus. But Allan A. Ryan, head of the Office of Special Investigations, refuses to say what those interviews showed.

This investigation took nine months. On Nov. 26, 1980, Ryan and U.S. Attorney Tom Sullivan told Judge Prentice H. Marshall, who had inherited the case, that the United States would not retry Frank Walus.

Today, Frank Walus is largely at peace but not entirely so. Many people in Chicago still cling irrationally to the conviction that he is or might be guilty. He also must fight the government over which of his expenses will be considered court costs, which Judge Marshall ordered the government to pay. Some $50,000 owed to his lawyer certainly will not be repaid by the government as lawyers' fees are never considered court costs.

Ryan's Office of Special Investigations had 17 deportation cases now on file against alleged Nazis, with more promised. Ryan, in an interview with the newspaper Chicago Lawyer, said he believes the "professionalism" of his new office will prevent a case like the Walus case from happening again.

And the Walus case can, for the moment, stand as another monument to the stupidity of witch-hunting of any type, however laudable the ostensible aim.