Federal agents investigating corruption in the General Services Administration have uncovered a network of bank accounts here and abroad that they believe were used to conceal millions of dollars of payoffs made to GSA employes by contrators who maintain and repair federal buildings.

The contractors put into the bank accounts money they received under contracts from GSA for maintanance and repair work that was never done, according to sources close to the investigation.

After shifting the money from bank to bank in various cities to make it difficult to trace, the contractors then withdrew the cash that they gave to the GSA employes who had approved the contracts and payments for nonexistent work, according to the sources.

The GSA employes then moved the payoff money from bank account to bank account to hide the payoffs, the sources said.

FBI investigators and federal prosecutors who are probing GSA with federal grand juries both here and in Baltimore have examined bank accounts in this country but have yet to check on those they have traced to foreign countries, including one in Switzerland.

Although no one has yet been able to total the amount of money involved, Vincent R. Alto, former Justice Department prosecutor hired by GSA Administrator Jay Solomon to help clean up corruption in the agency, has said that he believes it might be the biggest money scandal in U.S. government history.

One GSA employe under investigation allegedly received $250,000 in payoffs in just two years, according to the sources.

However, the investigators have found that most of the GSA employes being probed still live in relatively modest homes. "There was no ostentation," one source said. "By and large, the GSA people spent it on cars, girls, dinners and trips. About the only thing that wasn't paid for (by the contractors) was utility bills" of GSA employes.

"They spent half their days at Hogate's or the Flagship (restaurants on the Maine Avenue SW waterfront) buying dinners, drinks and girl for everyone," the source said.

Last week, seven of those GSA employes who are targets of the investigation into building maintenance contracts were subponaed by a grand jury, fingerprinted, photographed by the FBI, and required to provide samples of their handwriting, sources said.

The handwriting samples were needed to obtain further evidence linking the officials with GSA documents they allegedly signed to approve payments to contractors for work never done.

The FBI and prosecutors have found that in most instances it was the GSA officials who demanded payments for contractors, rather than the contractors who offered them. The GSA officials would then cover the cost of the payoffs and more by approving contracts for work that did not exist.

"The building managers would tell the contractors they had better kick in or they wouldn't get any contracts at all," a source said.

"They always received the cash in a one-on-one situation," the source said. As a result, prosecutors must obtain confessions from contractors before they can prove they were made.

Typically, GSA building managers certified that contractors had performed double or triple the electrical, painting, alteration, repair, or construction work actually done, sources say.

At Central Intelligence Agency headquarters in Langley, for example, investigators have found that the amount GSA paid for the installation of tile was enough to have paid for the tiling of floors in a building six or eight times the size of the CIA building, sources said. "A lot of the floors (in the CIA building) still have no tiles," an investigator added.

Since the investigation began, morale at GSA has plummeted and employes claim they are fearful of approving any payments to contractors because they might be criticized.

Like other government agencies, GSA has always had the reputation of operating at a snail's pace. But contractors now say it takes even longer to be paid for work.

"That's only ones of the reasons you had crooked contractors," said a source. "The only ones who could afford to wait until they were paid were the ones who had performed no work."

Since the investigation began, morale at GSA has plummeted and employes claim they are fearful of approving any payments to contractors because they might be criticezed.

Like other government agencies, GSA has always had the reputation of operating at a snail's pace. But contractors now say it takes even longer to be paid for work.

"That's one of the reasons you had crooked contractors," said a source.

"The only ones who could afford to wait until they were paid were the ones who had performed no work."

Since the investigations began, morale at GSA has plummeted and employes claim they are fearful of approving any payments to contractars because they might be criticized.

Like other government agencies, GSA has always had the reputation of operating at a snail's pace. But contractors now say it takes even longer to be paid for work.

"That's one of the reasons you had crooked contractors," said a source.

"The only ones who could afford to wait until they were paid were the ones who had performed no work."