Oversight of the Patent office’s telework program — and of examiners based at the Alexandria headquarters — was “completely ineffective,” investigators concluded. (Alex Brandon/AP)

Prompted by multiple whistleblower complaints, the U.S. Patent and Trademark Office began an internal investigation two years ago of an award-winning program that’s been praised in and outside government: Employees are allowed to work from home.

What the inquiry uncovered was alarming.

Some of the 8,300 patent examiners, about half of whom work from home full time, repeatedly lied about the hours they were putting in, and many were receiving bonuses for work they didn’t do. And when supervisors had evidence of fraud and asked to have the employee’s computer records pulled, they were rebuffed by top agency officials, ensuring that few cheaters were disciplined, investigators found.

Oversight of the telework program — and of examiners based at the Alexandria headquarters — was “completely ineffective,” investigators concluded.

But when it came time last summer for the patent office to turn over the findings to its outside watchdog, the most damaging revelations had disappeared. The report sent to Commerce Department Inspector General Todd Zinser concluded that it was impossible to know if the whistleblowers’ allegations of systemic abuses were true.

“What we hoped to see was an unfiltered response,” Zinser said.“That’s not what this was. It’s a lot less sensational. The true extent of the problem was not being conveyed to us.”

The original findings, by contrast, raise “fundamental issues” with the business model of the patent office, which oversees an essential function of U.S. commerce, said Zinser, who was provided a copy of the original by a patent official.

The patent office, while relatively obscure, plays a crucial role in supporting the nation’s commerce and economic development. But the agency’s army of examiners and other officials has been falling behind, with a backlog of patent applications swelling to more than 600,000 and estimated waiting times of more than five years.

The Washington Post obtained copies of the internal report and the version provided to the inspector general, which at 16 pages is half the length of the original.

Both reports conclude that policies negotiated with the patent examiners’ union have left managers with few tools to monitor their staffs. Both acknowledge that supervisors have limited access to records that could prove suspected time fraud, resulting in negligible disciplinary action.

But the original one describes a culture of fraud that is overlooked by senior leaders, lax enforcement of the rules and the resulting frustration of many front-line supervisors. The version provided to the watchdog was far less conclusive, saying that managers who were interviewed held “inconsistent” views on whether examiners were gaming the system.

An agency spokesman, in a statement for this article, described the version sent to the inspector general as a “final, carefully considered, accurate and complete report.”

Chief communications officer Todd Elmer called the original report a “rough draft for discussion purposes” that was an “initial attempt to describe the full investigation record.”

After a review, lawyers in the agency’s Office of General Counsel and chief administrative officer Frederick Steckler decided that “many of the conclusions” in the draft were “partial and unsupported by the facts and record of the investigation,” Elmer said in the statement. He said the final report contains “a more accurate, complete reflection” of the investigation. Steckler wrote both versions of the report, Elmer said.

The agency’s telework system has served as a model for the Obama administration, which has sought to attract talent by extending similar programs to many corners of the government. In addition to the approximately 3,800 patent examiners who work full time from home, about 2,700 telework on a part-time basis.

While the examiners were under scrutiny, patent officials received a separate referral from the inspector general after whistleblowers at the agency’s appeals board complained that paralegals there were idle. That referral resulted in an investigation that Zinser’s office disclosed in July, revealing that dozens of paralegals, who also work from home, were paid full salaries during a four-year period while they surfed the Internet, did laundry and read books instead of working. The investigation found that managers gave the paralegals limited assignments as they waited for new judges to be hired to handle a backlog of appeals. But because of a hiring freeze, the judges were not brought on until last year.

The examiners, the focus of the internal probe launched in 2012, review applications and grant patents on inventions that are new and unique. They are experts in their fields, often with master’s and doctoral degrees. They tend to be near the top of the federal pay scale, with the highest taking home $148,000 a year.

The investigation grew out of complaints by four whistleblowers to the inspector general alleging systemic abuses by patent examiners. Zinser referred the matter to the patent office, which appointed an internal review team of four human resources officials, two associate general counsels and an accountant.

Their review produced a report in February 2013 that concluded, “The interviewers found that many supervisors had troubling answers to some of the questions that were asked.”

It cited several detailed cases of time and attendance abuse. In one, an examiner missed 304 hours of work in a year but was paid for the time. Despite warnings, this examiner kept cheating and was caught twice but not fired.

Another examiner claimed to have worked 266 hours for which there was no evidence she was on the job, and she received $12,533 in pay. She was never charged with time fraud because an assistant deputy commissioner refused her supervisor’s request to pull computer records, but instead she was charged with a lesser offense of not responding to a supervisor’s repeated attempts to get in touch with her. According to a patent official with knowledge of the case, the woman was never required to pay the government back.

But these examples — and others cited in the internal report — did not appear in the document supplied to Zinser. That version found “no objective evidence of any systemic abuse of reporting procedures.”

The internal investigation also unearthed another widespread problem. More than 70 percent of the 80 managers interviewed also told investigators that a “significant” number of examiners did not work for long periods, then rushed to get their reviews done at the end of each quarter.

Supervisors told the review team that the practice “negatively affects” the quality of the work. “Our quality standards are low,” one supervisor told the investigators. “We are looking for work that meets minimal requirements.”

The final, condensed version noted only that patent officials have no policy that prohibits the practice and that examiners suspected of “end-loading” may well have been working throughout the quarter. “Some examiners . . . spend long periods on search and examination because they . . . want to make their actions perfect before submitting” their patent reviews, the document says.

Investigators found that front-line supervisors feel powerless to discipline poor performers. “We had evidence that the timesheet was not accurate,” one supervisor said, “but they still said no. [It] was four, five months ago and there was a push not to pull records.”

Another manager said that an examiner had a “mouse-mover” program on his computer to make it appear he was working. The manager saw it, took a picture and showed it to a top official “and nothing happened,” the supervisor said.

In short, the internal report concluded that “USPTO management demonstrated reluctance to take decisive action when the misconduct is egregious and the evidence is compelling.” Investigators recommended “unmitigated access” to records when abuse is suspected.

The version supplied to the inspector general, though, explained that managers did not provide full access to computer records that could substantiate allegations of fraud because officials did not want to be seen as “big brother” through electronic surveillance.

Investigators found a lax system for monitoring employees who work from home — some as far away as California. Examiners do not have to log into the agency’s computer network or tell their supervisors the hours they work. They do not have to respond to a phone call from their boss the same day it comes in. The boss has no way to tell when they are at their desks.

“Controls are almost non-
existent,” the review team wrote. It concluded, “Examiners can work inconsistently throughout the year, and even fail to be present at work, with little or no consequences.” The report described a “frustrated management team . . . in effect being told to look the other way.”

But the report forwarded to Zinser called the probe “inconclusive.”

Elmer, the patent office spokesman, said in his statement that the complete record of interviews with managers was submitted to the inspector general in supporting exhibits.

Zinser, however, said the agency was responsible not just for providing “raw data” but an accurate analysis.

He said he did not do his own investigation because he trusted that patent officials had the issues under control. But he said the copy of the original report he was given prompted him to launch a probe of the patent workforce’s quality control — whether its examinations are accurate. His office also is investigating time and attendance fraud at several other Commerce Department agencies.

“The fact that we received an unfiltered report has been very helpful to us,” he said. “It’s not a good message for senior management to send to the workforce: You do the work and we’ll sanitize it before it goes out.”