An Army general was stripped of both his stars and ordered to retire at the rank of colonel yesterday after investigators determined that he had sex with the wives of two subordinate officers and sought a sexual affair with an enlisted soldier.

The action against Maj. Gen. John J. Maher III marked the latest in a series of sex scandals to roil the Army in recent years and the first time, according to Army spokesmen, that a general officer was demoted two grades as a result of sexual misconduct.

In contrast to some earlier cases involving senior soldiers, which played out in very public court proceedings, this one was handled quietly in a closed-door administrative hearing weeks ago. The demotion was decided by Army Secretary Louis Caldera even before the charges were publicized yesterday.

While adultery of any kind is a crime under military law, Pentagon authorities take an especially dim view of affairs involving subordinates or their spouses because of the potentially damaging effect on morale and trust in the ranks. Making this point, Caldera said in a statement that the severity of the demotion "should send a very clear, strong signal that there is no place in the Army for this behavior."

As a result of his reduction in rank, Maher's annual retirement pay will drop to about $60,000, instead of the $77,000 he would have received had he left as a major general, officials said. Maher also was fined $8,600, representing half of two months' pay, the maximum allowed.

Until two months ago, Maher served as vice director of operations on the Pentagon's Joint Staff, a demanding job overseeing a broad range of U.S. military activities. The 51-year-old officer was viewed as likable, hard-working and destined for promotion.

Military officials said all of Maher's misconduct occurred more than two years ago, before he took the Joint Staff assignment in June 1997. And because he was demoted to colonel, at least one of the affairs appears to have taken place while he was a brigadier general, before he received his second star in October 1996. Under the Army's rules, a commissioned officer found guilty of misconduct can be dropped in rank to the grade at which it is determined he last served honorably.

Citing concern for the privacy of the women involved, Army officials declined to provide details of the relationships that were factors in Maher's case. They said Maher, who is married, could have requested a court-martial, but agreed to the private administrative hearing conducted on Sept. 29 by Lt. Gen. John M. Riggs, the First Army commander.

A senior Army official suggested that the more discreet nonjudicial option may have been offered Maher because of the possible reluctance of witnesses to testify in open court and the time elapsed since some of the misconduct occurred. The Army began investigating Maher after receiving a telephone tip in February, the official said.

Neither Maher nor his military attorney was available for comment yesterday.

Prior to assuming the Joint Staff job, Maher spent two years commanding the 25th Infantry Division in Hawaii. Before that, he served one year as assistant commandant at the Army's Infantry School at Fort Benning, Ga. And the year before that, he was assistant commander of the 24th Infantry Division at Fort Stewart, Ga. Maher joined the Army 29 years ago.

Yesterday's action was the second time in two months that Caldera demoted an Army general for having affairs with the wives of subordinate officers. In September, he dropped retired Maj. Gen. David Hale to brigadier general, a loss of one star.

Early last year, Hale, then serving as the Army's deputy inspector general, was allowed to retire quietly despite allegations that he had sex with the wife of a subordinate while he was a top NATO commander in southern Europe. Later, investigators alleged that Hale had also been involved with the wives of three other subordinates and the Army took the highly unusual step of court-martialing him despite his retirement.

CAPTION: John J. Maher III was vice director of operations of the Joint Staff.