A Johnstown-area defense firm under investigation for possible contract fraud received an infusion of cash during its start-up years from a narcotics trafficker with whom one of the company's founders admitted engaging in the drug trade.

At the time, Kuchera Industries was a startup company that assembled electronics components and sought federal contracts -- contracts that would ultimately make the company and its sister firm, Kuchera Defense Systems, multimillion-dollar businesses.

Peter Whorley, a Florida man and business associate of William Kuchera, one of the top officers at the companies, put up $50,000 to help Kuchera Industries find its feet, according to court records. Kept on the Kuchera books as a consultant receiving "special commissions," Mr. Whorley later helped the company in its unsuccessful efforts to land a contract with the United States Census Bureau in the mid-1980s.

Mr. Whorley's $50,000 line of funding, and whether it amounted to a loan or a share of the company, became the subject of a bitter legal battle between the two former partners who, according to a deposition by William Kuchera, were once associates in the narcotics trade.

The role of Mr. Whorley, as well as Mr. Kuchera's past as a marijuana dealer, surfaced amid a federal investigation of the Kuchera companies.

What was unclear was whether Mr. Kuchera's narcotics conviction should have precluded him or his company from receiving a security clearance that would enable the firm to perform defense work.

Department of Defense spokesmen did not respond to requests to explain the firm's status and the possible effects that a felony conviction would have on the Kuchera companies' eligibility for defense work.

Loren Thompson, who heads the Lexington Institute, a Washington-area think tank that deals with defense procurement issues, said he believed a narcotics conviction would be sufficient to disqualify Mr. Kuchera.

"Felony drug convictions are usually enough to disqualify a person for a security clearance, because they go to character," Mr. Thompson said.

Both Mr. Kuchera's attorney and Mr. Whorley, speaking through his lawyer, declined to comment on the matter.

U.S. Rep. John P. Murtha, D-Johnstown, has helped to direct millions of dollars in federal defense appropriations to major defense contractors that sub-contract large portions of the jobs to Kuchera Defense Systems. The Kucheras, their employees and associates are among major contributors to Murtha political campaigns.

There is no indication that Mr. Murtha was aware either of Mr. Kuchera's past or Mr. Whorley's role in the firm's early days.

A Murtha spokesman declined comment about the Kucheras today.

Federal agents raided both Kuchera plants, located in Windber, Somerset County, in January. They also executed search warrants in the homes of both William Kuchera and his brother, Ronald.

Sources close to the probe said federal prosecutors are attempting to determine whether the companies padded their payroll to increase the amount of federal cost-plus contracts, and whether they delivered on millions of dollars in federal contracts steered their way through Mr. Murtha's office.