NEW YORK, NOV. 21 -- Rep. Robert Garcia (D-N.Y.) and his wife, Jane Lee Garcia, were indicted here today on charges of demanding and receiving more than $150,000 in cash and jewelry from Wedtech Corp. and its executives in exchange for his efforts to aid the now-defunct defense contractor.

Garcia, 55, who has represented the South Bronx for more than 10 years and was the second Puerto Rican-born American elected to Congress, was accused of receiving bribes disguised as legitimate payments to his wife, 48, and his sister, according to the indictment.

More than $75,000 was allegedly funneled through a family friend, Ralph Vallone Jr., 41, a Puerto Rico attorney also charged by a federal grand jury here.

In a statement shortly before the indictment was announced, Garcia said: "My brush with the criminal justice system has left me deeply shaken as I observed the government harass and intimidate my staff, colleagues, friends and family to induce them to say something negative about me, while virtually ignoring polygraph evidence demonstrating my innocence and all other exculpatory information and testimony."

Rudolph W. Giuliani, U.S. attorney in Manhattan, said there had been "no harassment of any kind."

Garcia, son of a minister, was reelected this month with 92 percent of the vote, although allegations that he took bribes from Wedtech first were disclosed last March during the trial of his Bronx colleague, former representative Mario Biaggi (D-N.Y.). Biaggi was sentenced Friday to eight years in prison for his role in the Wedtech scandal.

If convicted of extortion, bribery, conspiracy and receipt of illegal gratuities, the Garcias each face 79 years in prison and $1.7 million in fines.

Beginning in May 1984, the seven-count indictment said, Garcia and his wife, who then worked on his House staff, allegedly demanded and received money from Wedtech by threatening the Bronx firm with "economic loss."

Over the next 20 months, the indictment said, Wedtech paid attorney Vallone $86,000 disguised as legal fees. Vallone then allegedly passed $76,000 in the form of "consulting fees" to Jane Garcia, who "purported to conduct a business" called Leesonia Enterprises, according to the indictment. It said Vallone, who has denied wrongdoing, kept the remaining $10,000.

Garcia was also charged with obtaining a $20,000 no-interest loan from Wedtech official Mario Moreno, a cooperating witness who has pleaded guilty to second-degree larceny.

In 1985, at Garcia's direction, the $20,000 allegedly was passed to his sister, the Rev. Aimee Cortese, and then to Jane Garcia. Cortese, a Bronx Pentecostal minister and former PTL ministry board member, was not charged with wrongdoing.

The conspiracy allegedly included other payments to the Garcias from Wedtech founder John Mariotta, also sentenced Friday to eight years in prison.

On a trip to the Virgin Islands in 1985, Jane Garcia allegedly received a diamond and emerald necklace from Mariotta and his wife, Jennie, according to the indictment. In addition, Jane Garcia is charged with receiving $77,500 from Mariotta's wife that year.

Garcia said in his statement that the charges were based on "the preposterous allegations of Mario Moreno, one of the most notorious felons of the 20th century." Asked about this at a news conference, Giuliani said Moreno has testified at four Wedtech trials, "and every defendant he's testified against but one has been convicted."

Garcia also was charged with failing to report the payments on House financial-disclosure statements.

The indictment did not spell out what Garcia did for Wedtech, except to say that he helped the company to seek a bank loan and met on its behalf with Puerto Rico's governor. James Fox, head of the Federal Bureau of Investigation office here, said Garcia allegedly tried to "obtain lucrative defense contracts for Wedtech."

During Biaggi's trial, Mariotta testified that his wife had paid $75,000 to Jane Garcia as an investment in a clothing store but later admitted that his wife never had anything to do with the store.

Wedtech, once hailed by President Reagan as a model of minority enterprise, is bankrupt, and some of its 1,000 employees are on welfare.