While U.S. troops sweat it out in the blistering heat of the Saudi desert, the nation's economic war against Iraq is being waged from the second floor of a comfortable Washington office building.

The Office of Foreign Assets Control, an arm of the Treasury Department, was mobilizing even as Iraqi President Saddam Hussein's tanks were rolling into Kuwait City.

The office has been charged with implementing and enforcing economic sanctions. Its goal was simple: to prevent Iraq from disposing of the financial and material assets of both the Kuwaiti and Iraqi governments that were locked in U.S. banks or companies.

Working hand-in-hand with other countries in the United Nations, which in the weeks following the Aug. 2 invasion voted economic sanctions against Iraq, OFAC hopes to force Iraq to a standstill, forcing Saddam out of Kuwait without the need for military action.

Carpeted in soothing pink and lilac, this collection of paneled office spaces on the second floor of the Treasury Annex on Madison Place -- where employees hang photographs of their children and the occasional sketch dedicated to "Daddy" over their desks -- does not look like a battleground.

But according to its director, R. Richard Newcomb, that's what it is. Although anxious to play down the war analogy, Newcomb admits: "This is the other front . . . {my staff members are} an elite category of highly trained professional men and women devoted to waging economic warfare."

The 40-member team, augmented to 60 for the Persian Gulf dispute, is no stranger to crises.

Established in 1940, it imposed an economic blockade on both Japan and Nazi Germany during World War II and then administered sanctions against Communist China in 1949, North Korea in 1950, Cuba in 1962, and more recently, against Iran, Libya, Nicaragua and Panama.

Each program is tailored to meet the desires of the president or Congress.

Some are limited. Only an import-export embargo was imposed on Nicaragua.

Others are more sweeping. The long-standing U.S. embargo of Cuba, for example, includes even sports: The Pan American Games scheduled there for Aug. 3, 1991, will be without U.S. spectators and U.S. cash, although U.S. teams will participate. There are also concerns about how drug-testing equipment, which is made in the United States, will get to Cuba and how technicians will be trained.

"The {sanctions} programs are tailored, they are fine-tuned, by the Treasury Department in consultation with the State Department and the National Security Council, to address the particular foreign policy objectives the programs were designed to effect," said Newcomb.

When the Iraqi crisis broke out, OFAC was in the process of winding down the Panama sanctions program, aimed at denying "currency to the corrupt {Manuel Antonio} Noriega regime," and was continuing the embargoes against Cuba, South Africa, Vietnam and Iran.

Newcomb was at home in Alexandria on Aug. 1 when Deputy Treasury Secretary John E. Robson called him at 10 p.m. with news that Iraqi armed forces were moving into Kuwait.

He rushed to the White House to meet with the president's staff, State Department, National Security Council and Justice Department officials. Newcomb, a former director of the Treasury's Trade and Tariff Office, knew it was going to be a long night. During his 3 1/2 years as director of the OFAC, he had done this before.

Newcomb said as he drove to the White House a major concern was when he could find time to get out of the casual blue shirt and khaki trousers and into a suit. "I knew that the next day was a business day," he said.

But by the time he reached the White House, his attention changed from his attire to how to prevent the Iraqis from looting Kuwaiti wealth from U.S. bank accounts and companies.

First he alerted the Federal Reserve Bank in New York, which conducts international governmental transactions, and as many of the major banks as possible about the prospect of freezing Kuwaiti and Iraqi assets. Next he called the U.S. Customs Service to warn that a trade embargo against Iraq was likely. Then he summoned his staff to draw up the technical executive orders President Bush had to sign to launch the sanctions.

Speed was vital, he said. "The Iraqis were rolling in their tanks, and they would have received the critical information they needed to drain the Kuwaiti assets in the U.S. banks. . . . The most important job was getting the assets blocked so Iraq couldn't get its hands on them."

The mission was completed by 4:30 a.m., less than seven hours after the White House summons. The orders blocking all fiscal and material movements of Kuwaiti and Iraqi government assets in the United States were signed by the president to take effect from 5 a.m. Aug. 2.

Since then, the OFAC team has worked 18-hour days to identify Kuwaiti and Iraqi assets, which range from money, checks and bullion to royalties, trademarks and insurance policies. Postage stamps could be included: buying and selling stamps from North Korea, Cuba, Vietnam, Cambodia, Iran, Libya and Nicaragua have been outlawed by the U.S. government.

The asset list is designed to be as comprehensive as possible. "If there were more things we could have on there, we would," said Newcomb.

Although OFAC will not reveal the value of Kuwaiti assets that have been frozen to keep them out of Iraqi hands, Kuwait is reported to have assets totaling more than $100 billion worldwide. Finance Minister Sheik Ali Khalifa said recently the exiled Kuwaiti government has been given "full management" of those assets and that they are now unfrozen.

An OFAC spokesman said Iraqi interests in the U.S. are "not significant," probably a few hundred million dollars or less, so the identification effort focused on Kuwaiti assets, a task aided by the friendly exiled government.

OFAC also has been fielding as many as 500 phone calls a day. Some are from attorneys confused, for example, about the status of billions of dollars worth of crude oil purchased prior to the sanctions and now in tankers on the high seas. Others are from businessmen -- mainly in gas, oil and real estate industries -- concerned that their companies might not be allowed to operate under the restrictions.

Many companies have now been licensed by the OFAC, including Kuwait Airlines. Newcomb said the airline had 15 planes "stolen" by the Iraqis during the invasion. But eight of them were outside Kuwait when Iraq invaded and can operate within the United States.

A major question remains: Do sanctions work?

According to Newcomb, there is clear evidence that previous sanctions against other countries have worked. Sanctions prodded the white government of South Africa to talk to the African National Congress, they considerably undermined Noriega's strength in Panama, and they contained Fidel Castro's Cuba, he said.

But are the current measures working against Saddam? Will they prevent bloodshed in the Middle East?

"It remains to be seen, but I have high hopes that this will be successful," he said.