COLUMN ONE : Adopting a Tougher Policy : Foreign adoptions are being curtailed in many Latin American countries. Alarm at corruption and rumors of ruthless Americans on the prowl for tiny organ donors are behind the crackdown.

According to lurid rumors that keep popping up across Latin America, sinister foreigners are buying or stealing babies through bogus adoptions and taking them abroad to use as donors for organ transplants.

Though never proven, such stories sometimes appear in print, raising waves of public panic and occasionally triggering violence.

Late last month, for example, Guatemalan villagers severely beat a woman from the United States who was rumored to have snatched a local child--the youngster later turned up.

Naturally, these rumors give international adoption a bad name in this region, as do the bribery and fraud that sometimes accompany the adoption processes--sticky strands in the complex web that has kept James Gagel captive here for more than two years.

Peruvian authorities arrested Gagel, a lawyer from New Jersey, in February, 1992, and charged him with child trafficking. He spent a year in jail and is now barred from leaving the country as he awaits judgment on accusations that he headed a group that allegedly bought or kidnaped babies for Americans to adopt.

Gagel’s Peruvian lawyer argues that there is “absolutely no factual basis” for the charges.

Gagel says he is the victim of persecution by corrupt, ignorant and xenophobic Peruvians. His trial has been repeatedly postponed by glitches in the judicial proceedings, which he likens to a fictional nightmare.

“I’m in the middle, really, of a Kafka novel,” he said over breakfast one day last month in a hotel cafe.

For many years, North Americans and Europeans have encountered controversy when they adopt babies in Latin American countries.

While bribes are often useful and sometimes necessary to cut red tape, lawyers say, reports of falsification of documents and other fraud have triggered suspicions of baby buying.

Suspicions have also been fed by the recurring rumors of children being adopted by foreigners who want to exploit them not only for “spare parts” but as prostitutes or household servants. Gagel said a police commander who accused him of child trafficking claimed that adopted babies were sent to the United States for use in scientific experiments.

Gagel’s case is symptomatic of a moral quandary faced today by many Latin American countries: International adoptions could save thousands of Latin American children from lives of misery or early death by neglect, but controversy and corruption raise troubling questions.

Peruvian bureaucrats and judges, nervous about scandals, have sharply reduced the number of international adoptions in the last two years.

According to the U.S. Consulate in Lima, U.S. visas issued for children adopted here dropped from 620 in the 1991 fiscal year to 270 in 1992 and to 170 in 1993. Since this fiscal year began Oct. 1, no Americans have been able to adopt Peruvian children.

Meanwhile, according to statistics compiled by CARE International, an estimated 68 of every 1,000 babies born in Peru die before they are a year old, compared to about 10 per 1,000 in the United States. Some Latin American countries have even higher infant mortality rates, such as neighboring Bolivia, with 89 per 1,000, according to CARE.

Gagel, 37, reflected on such numbers as he finished a plate of sliced papaya.

“Even though adoption represents a small percentage, it does have its value to give a few of these children a good home, a good future,” he said.

But in Peru and an increasing number of other countries of the region, sentiment against international adoptions and stricter new regulations are hindering the placement of babies in foreign homes.

As a result, Latin America is no longer as abundant a source of adopted U.S. children as it once was.

“I think you can say that there are fewer possibilities in all of these countries than before,” said Heino Erichsen, executive director of Los Ninos, an international adoption agency in The Woodlands, Tex.

“An adopting couple has the simple idea of coming to the Third World, finding a child, loving it, raising it,” Gagel said. “That idea meets with opposition here.”

The opposition, he said, includes nationalists who resent North Americans taking away children of the fatherland; leftists who see adoptions by Americans as Yankee imperialism; underpaid bureaucrats and judges with power over adoption paperwork who envy babies taken from the bottom of the social scale to foreign countries where they will live in relative luxury; some who envy adoption lawyers with new cars and cellular telephones, and others who carry on a long tradition of dislike for foreigners.

“There is a lot of pleasure here in getting a gringo in your jaws and venting some of your centuries-old resentment,” he said.

But not all Peruvians who worry about international adoptions have anti-U.S. sentiments. Many merely want to prevent crooked deals that can result from a combination of unscrupulous lawyers, corrupt officials and foreign couples with money and a burning desire to be parents. “They combine to turn a child into an object of commerce, of deceit,” a former juvenile judge said.

In Peru, child-stealing rumors mesh nicely with a centuries-old folk myth about a diabolical being who drugs unwary people who venture out at night and extracts their body humors, or “greases.” Called Pishtako in the native Quechua language of the Andean highlands, this bogyman was increasingly depicted as a white foreigner.

In 20th-Century versions, “greases” from the Pishtako’s victims were exported to the United States to lubricate or fuel machinery.

“Thus, satellites supposedly were being fed by the ‘grease’ of Peruvians,” said Luis Millones, an anthropologist and historian.

The evolving myth has fostered an antipathy toward adoption, Millones said. “The people are thinking, ‘Why do they want these children?’ ”

The recurrent rumor of adoptions for “spare parts” was running strong in 1992 when Gagel’s arrest exploded in scandal on the front pages of Lima tabloids.

Here, it must have seemed to some, was a real-life Pishtako caught in the act.

Many Latin American countries--including Bolivia, Colombia, Ecuador, Honduras, Paraguay and Guatemala--have witnessed equally blustery storms of “baby-buying” and “baby-stealing” scandals.

“The Guatemalan press right now is absolutely raving insane over this issue, in relation to using babies for body parts and for carrying drugs,” said Gerry Fuller, an official in the State Department visa office.

The woman from the United States who was beaten in Guatemala last month was chased by villagers into a municipal building in the northern town of San Cristobal Verapaz and hit with machetes, clubs and metal pipes until she lost consciousness. June Weinstock, a 51-year-old environmentalist from Fairbanks, Alaska, remains in a coma and was airlifted to the United States on Wednesday.

Also last month, rumors of another U.S. woman’s arrest for stealing a baby sparked disturbances in the Guatemalan village of Santa Lucia Cotzumalguapa. Villagers burned down the local police station and destroyed several vehicles, the Reuters news agency reported. It said at least 15 people were injured in clashes with police after rumors spread that the woman had paid several thousand dollars to be released.

In Honduras at the beginning of March, the government promised an investigation of unconfirmed reports that Honduran children were being sold abroad for organ transplants. Honduran police have reported raiding “fattening houses” where babies allegedly stolen or bought from poor mothers are cared for until they are adopted.

It was in Honduras in January, 1987, that rumors of trafficking in children’s organs were first published in a daily newspaper, according to a U.S. Information Service report.

In April, 1987, the Soviet newspaper Pravda published the Honduran story--without noting that it had been denied by authorities. The Soviet news agency Tass sent the story around the world, and similar versions have been reappearing ever since.

While such stories have raised public suspicions, clear evidence of corruption has been even more damaging.

In Peru, hardly anyone will deny that bribes have been paid to mothers, judges and other court officials, government attorneys and police.

“There were a lot of people involved in this, in the child-trafficking Mafias,” said Jaime Jesus, coordinator in Peru for the Stockholm-based Save the Children foundation.

A Peruvian adoption lawyer who asked that his name be withheld admitted that he has routinely bribed officials as a necessary means of making paperwork move.

He denied paying mothers for babies, but he acknowledged that he often gave women “gifts” after they gave up their children.

“I would give them enough to live on for two or three months,” he said.

Gagel, a 1982 Rutgers University law graduate with a record of public service in New Jersey and New York, denies that he ever gave gifts or bribes in exchange for a baby. In fact, he said, it was his refusal to pay bribes that led to his troubles.

He came to Peru in 1989 on a Fulbright fellowship to help reform the criminal justice system and stayed on to start an international adoption service with a Peruvian lawyer in 1990.

This was a tricky business in Peru, as in many Latin American countries. Red tape was massive. To get through, it often required bribes.

Gagel said the adoptions he handled were done in Peruvian provinces to avoid red tape and corruption in Lima. One of the papers required for an adoption was a police certificate to show that the baby was not a missing person.

Gagel said Cmdr. Victor Prado, former head of the police missing persons bureau in Lima, charged $300 for each certificate, but Gagel refused to pay.

It was the same Cmdr. Prado who first accused Gagel and 22 Peruvians of operating a child-trafficking ring. The 22 included employees of Gagel’s office, his lawyer-partner, foster mothers who took care of babies to be adopted and people whose names were “found in my card file, people I didn’t even know,” Gagel said.

Prado’s police raided Gagel’s home and office, confiscating papers and a computer. Prado himself arrested Gagel at 7:30 a.m. in his apartment, beating him and screaming obscenities, according to Gagel.

Gagel pressed charges against Prado for a series of violations, but those charges were dismissed. The charges against Gagel, however, resulted in indictments.

The government attorney who brought the original charges said Gagel’s “ring” had arranged thousands of irregular adoptions. Gagel said he arranged no more than 40, all by the book. He said a few Peruvian lawyers have reaped big profits from international adoptions but that he earned only a modest income from them.

The only biological mother who complained about one of his adoptions had been “reading stories about organ parts for transplants,” he said. She was worried because she hadn’t received a letter for several months from the adoptive parents, a professional couple in the San Francisco area.

Last year, The Hague Conference on international law adopted a convention on adoptions that is intended to standardize legal processes from country to country, reducing red tape and guarding against irregularities.

Countries that ratify the convention must establish a central authority for overseeing adoptions and assuring that they comply with The Hague standards.

Many Latin American countries, including Peru, are preparing to ratify the convention.

To comply, Peru has passed a new adoption law that empowers a Technical Secretariat for Adoption to determine the eligibility of children for adoption and to match them with eligible adopting parents.

Since it began working in August, the new secretariat has awarded custody of children to 20 Peruvian couples and a single Canadian couple in the process of adopting.

No longer may private lawyers seek out mothers to give their babies up for adoption by clients.

“Now the mother has to give it up to the government welfare agency, which they don’t like to do,” said Erichsen of Los Ninos, speaking by telephone from Texas.

Jorge Valencia, a lawyer on the new Peruvian secretariat’s board of directors, said some deceptive adoption lawyers used to induce foreign clients to spend up to $30,000 in fees and expenses for an adoption, including payments to biological mothers.

“There are indications that there was a whole situation of corruption,” Valencia said. “What we want to avoid is child trafficking--that a mother is paid $500 for her child, or $1,000.”

He admitted that adoption now is not “a fast process. You have to investigate. You have to publish notices.”

One analyst observed that because officials no longer get bribes to speed things up, they naturally go slower. And because private lawyers no longer are permitted to shepherd paperwork through the bureaucracy and courts, the task falls to the secretariat’s limited staff.

Diplomatic observers say the secretariat has a tiny budget and that its few employees are underpaid and untrained. The secretariat operates only in Lima, so no adoptions can be done in the provinces.

“The system now doesn’t function,” said Julio Lozano, Peruvian representative for the Spence Chapin adoption agency of New York.

Lozano said the only children his agency has been offered for adoption are more than 7 years old and have mental or physical handicaps.

“Who is going to want to adopt a child with problems, especially at that age?” he asked, adding that the secretariat apparently does not want international adoptions.

The secretariat said its priority is to give babies to Peruvian couples ahead of foreign couples.

Officials have said that about 100 couples in Lima are looking for babies and that only one adoption in 10 will be granted to foreigners until the Peruvian demand has been met.

“We aren’t against international adoptions,” Valencia said, “but we want them to be done under the strictest controls, the strictest judicial rules.”