WASHINGTON (AP) _ The U.S. government employed convicted Nazi war criminal Robert Jan Verbelen as an intelligence agent for 10 years after World War II to help fight communism in Austria, the Justice Department acknowledged Thursday.

A report released by Attorney General Edwin Meese III said Verbelen worked with the U.S. Army's Counter-Intelligence Corps, or CIC, and that officials accepted two different versions he gave of his background.

The 92-page report said Verbelen, now 77 and living in Austria, ''manipulated the CIC into protecting him from being brought to justice for his crimes.''

Verbelen was convicted in absentia and sentenced to death in his native Belgium in 1947 for being primarily responsible for killing 101 people in an operation in which Belgians identified with the resistance were ''arbitrarily selected to be arrested, beaten, tortured, imprisoned, deported or murdered.''

An Austrian jury in 1965 found him guilty of two wartime murders but acquitted him on the basis that he was following order. The decision was overturned by the Austrian Supreme Court, but the case has not been retried. Verbelen also was accused of torturing U.S. airmen.

Neal Sher, director of the Justice Department's Office of Special Investigations, which conducted a two-year study at the request of the Anti- Defamation League of B'nai B'rith, said Verbelen accomplished his deception because of the CIC's ''practice of utilizing Nazi criminals and their collaborators in its postwar, Cold War European intelligence operations.''

Verbelen served with the CIC from 1946 until December 1956 and later worked for the Austrian State Police. He became an Austrian citizen in 1959.

Sher said at a news conference that the report has been given to the Belgian and Austrian governments.

The report said the Army intelligence group discovered Verbelen's true identity when the CIA asked information about him. Sher declined to say how long the CIA had known who he was or to give any other information about the agency's involvement with Verbelen.

Sher said there were obvious dangers in using Nazi war criminals because they might be blackmailed. In Verbelen's case, the CIA didn't even know who they had hired, he said.

Sher said the investigation was not related to any modern intelligence- gather ing efforts and was not meant to be judgmental. But he said some conclusions ''cry out.''

The report said the CIC followed a policy that ''the end justifies the means.''

The report described 13 other past U.S. agents and informants with Nazi connections but did not name them. Sher said the Army, in cooperating with the investigation, had demanded that they not be identified.

He said Justice Department investigators interviewed Verbelen himself in the summer of 1985 and found him unrepentent. ''He thinks he has nothing to be ashamed of,'' Sher said.

Edward Dennis, head of the Justice Department's criminal division, said the investigation was done as thoroughly as possible, ''regardless of who that will embarrass or make uncomfortable.''

The report said no U.S. government agency made any effort to apprise Belgian authorities of Verbelen's whereabouts when his true identity was uncovered.

It said that even when the U.S. agency dismissed Verbelen, after it discovered his Nazi war record in 1956, it did so ''without prejudice'' and classified him as ''suitable for intelligence re-employment.''

The report said the CIC apparently relied entirely on the information Verbelen gave about himself, including the name he gave, Peter Mayer. In 1950, he informed the agency his name was really Herbert Schwab, describing himself as a devoted Nazi Party member since the mid-1930s and a member of a Nazi security unit that was declared a criminal organization after the war, the report said.

''Despite this change in identity and life history, the (CIC) made no attempt to verify the information Verbelen supplied about himself, and it continued to employ him,'' the report said.