A clinical psychologist recently acknowledged to a federal investigator that he had billed the Defense Department for twice the number of therapy sessions he actually had conducted. But the Justice Department refused to prosecute him, saying the $2,000 in illegal claims was an "insignificant dollar loss."

The government discovered that three Economic Development Administration construction projects worth $280,000, which were supposed to be awarded to minority-owned construction firms, went to a firm that had set up a minority "front company" to qualify. But again Justice declined to prosecute, because there was "no dollar loss to the government."

Each year, about 200,000 potential federal crimes are referred to the Justice Department for litigation, but only about 40 percent of them are accepted, a recent General Accounting Office study found.

"With limited resources, the department is forced to concentrate on those cases . . . of greatest importance and the most likely to attract public attention," the GAO said.

That has prompted Sen. William V. Roth Jr. (R-Del.) to introduce legislation to create a sort of small claims court at many federal agencies. His bill, which has been endorsed by Justice and the GAO, would permit the government's 18 inspectors general to subpoena witnesses and file civil fraud suits for amounts under $50,000 before the agency's administrative law judges.

Justice could continue to prosecute any case that it wanted to take on, but the IGs would be able to proceed on their own if Justice didn't take action within 120 days.

"An unscrupulous contractor," Roth contends, "can take advantage of the current system and make millions in overcharges."

Currently, Justice sends many of the criminal cases to state and local officials to prosecute. Some cases are returned to federal agencies for administrative action. But an unknown number of other cases simply fall through the cracks.

The Senate Governmental Affairs permanent subcommittee on investigations, which Roth chairs, found that most of the dropped cases involve small amounts and civil fraud, such as the two cases cited above, and usually are dropped for economy reasons.

"The cost of litigation . . . is simply too great in many cases for it to make good economic sense to bring a civil fraud case into a federal court," J. Paul McGrath, assistant attorney general for the Civil Division, has told Congress.

The American Bar Association's public contract law section opposes Roth's bill, partly because it thinks the government already has enough laws to prosecute fraud cases. It also contends the bill would make it easier for the government to accuse legitimate contractors of fraud and give the government an unfair advantage in contract disputes.

"We do not believe that there is any justification for expanding remedies to permit individual agencies to act as prosecutor, judge and jury," said David L. Hirsch, a former chairman of the ABA group.

Hirsch also dislikes the bill's tougher penalties, which would allow agencies to impose a $10,000 fine for each count of fraud, in addition to an automatic doubling of the amount of money involved. For example, a physician who filed 25 false Medicaid claims worth $50 each could be assessed up to $252,500 in penalties even though the false claims totaled only $1,250.

Roth's staff says the bill has a good chance of passing because, two years ago, Congress ordered the Health and Human Services Department to set up an internal system for prosecuting fraud. That system is nearly identical to the one called for in Roth's proposal. HHS was told to implement the program, which is expected to go into operation soon, because of the large number of people who were abusing Medicaid and Medicare.

There are nearly 100 different types of federal investigators who can refer cases to the Justice Department, ranging from FBI agents to the Agriculture Department's border-state tick inspectors. But the inspectors general are the ones complaining the loudest about dropped cases.

The situation is "very disheartening to our people, who take very seriously the fight against fraud, waste and abuse, only to see the results of their effort collect dust in the file," Sherman M. Funk, the Commerce Department's IG, recently told Congress.

Jane Restani, who directs Justice's commerical litigation branch, said her office normally won't accept a case that involves less than $100,000. Smaller amounts are referred to the local U.S. attorney's office, unless the cases involve public figures or might set a precedent.

"When you have limited federal resources, you tend to decide cases on whether someone has committed an activity worthy of them going to jail," explained Donald Foster, deputy chief of the fraud section. "And you have to think twice when someone brings you a case where an 80-year-old woman has illegally cashed two of her deceased husband's Social Security checks. No one is going to send her to prison."

The most recent report of the inspectors general said the Justice Department declined one-third of all the fraud cases they referred to it in fiscal 1982.