It was hard to distinguish the winners from the losers last Thursday at the sentencing of Iraqgate defendant Christopher P. Drogoul in the U.S. District Court for the Northern District of Georgia, Atlanta.

Mr. Drogoul Appeared mildly pleased to learn that he probably wouldn't serve more than 10 additional months of jail time for making billions of unauthorized loans to Iraq during the late 1980s while an employee of Banca Nazionale del Lavoro in Atlanta.

Defense attorney Robert M. Simels was obviously jubilant. But Howard E. Heiss, the assistant U.S. attorney who led the successful prosecution effort, looked grim.

While Mr. Simels spoke easily with reporters, Mr. Heiss packed up his briefcase and refused to answer questions, other than to say he was immediately returning to New York, where he had been based before being sent to Atlanta in July.

$2 Billion in Loan Losses

Not represented in the courtroom but just as much a loser is Mr. Drogoul's Rome-based former employer, whose efforts to recover nearly $2 billion in loan losses will likely be hindered as the U.S. government pursues an investigation of the bank.

U.S. District Court Judge G. Ernest Tidwell, who appeared exceedingly impatient throughout the four-day hearing, blasted nearly everyone concerned: the government, the defense, the bank, and Mr. Drogoul.

A 37-Month Sentence

The case, which took more than four years to reach the sentencing stage, was a waste of resources, he said, adding that it "has been blown way out of proportion to its real significance by everybody involved in it."

Judge Tidwell sentenced the 44-year-old former manager of Lavoro's Atlanta branch to 37 months in prison. Counting the 20 months Mr. Drogoul spent at the Atlanta federal penitentiary while awaiting trial and likely time off for good behavior, Mr. Simels estimated his client would be back with his wife and four children in I 0 months.

Mr. Heiss had asked for more jail time, up to 6 1/2 years over all, on the ground that Mr. Drogoul had not proved his argument that the Rome-based bank knew of his activities.

Judge Tidwell agreed that Mr. Drogoul was "clearly guilty" and "was clearly the author of his misfortune." But he also lambasted the government for its "overindictment" of Mr. Drogoul and for conducting a flawed prosecution.

Indictment Streamlined

Mr. Drogoul was originally indicted in February 1991 on 347 counts relating to his providing more than $4 billion in unauthorized loans and other credit to Iraq. Many of the counts were simply technical variations on basic charges, but a guilty verdict could have sent him to prison for the rest of his life.

When Mr. Heiss and acting United States Attorney John M. Hogan arrived in July as representatives of the new Clinton Justice Department, they reduced the indictment to a more manageable 70 counts. Mr. Drogoul pleaded guilty in September to just three counts: one for wire fraud and two for making false statements to federal regulators.

The judge concluded Lavoro "knew or should have known" what Mr. Drogoul was up to. Mr. Drogoul, who did not testify Thursday, argued through his attorney that he was merely a pawn in a scheme engineered by others, pointing the finger principally at former Lavoro managing director Giacomo Pedde.

Owed Millions by U.S.

Mr. Heiss said an investigation is continuing into Mr. Pedde's role.

That could be bad news for Lavoro, which is still trying to recover more than $370 million owed to it by the Agriculture Department under a guaranteed-export program.

Early in the hearing, managing director Umberto D'Addosio testified that Mr. Drogoul's various schemes cost Lavoro a total of $1.9 billion. Besides the grain transactions, Mr. Drogoul made $2.1 billion in direct loans to the Iraqi central bank, of which $1 billion was disbursed before the Federal Bureau of Investigation raided Lavoro's Atlanta office in August 1989.

Lavoro's chances of recovering this money appear to be slight. Mr. D'Addosio said the bank had shopped some of its Iraqi debt on the international market at the end of November but found no takers.

A United Nations embargo against Iraq prohibits U.S.-based firms that trade discounted foreign debt from handling Iraqi debt.

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