WASHINGTON — The Agriculture Department has pretended to investigate anti-competitive behavior among stockyards and meat companies since 1999, but in hundreds of cases the investigation was a sham, a department audit found. Senior officials blocked investigations from being referred to department lawyers, who can file complaints or refer cases to the Justice Department, according to the audit by the agency’s inspector general.

In the meantime, employees were told to create the appearance of a high rate of enforcement by logging routine letters and reviews of public data as investigations, the inspector general said.

"Competition and complex investigations were not being performed, and timely action was not being taken," the audit said.

As of last August, 50 investigations were being held up by Deputy Administrator JoAnn Waterfield, who had final say over sending cases to department lawyers. Waterfield quit abruptly last month without giving a reason.

Waterfield reprimanded one regional office last year because it didn’t count routine correspondence as an investigation. After being chided, the East region climbed from last to first among the three regions by reclassifying more than 300 routine activities as investigations.

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Department officials acknowledged the problems but said they’re being fixed.

"Of course I was bothered," said James E. Link, the new administrator of the Grain Inspection, Stockyards and Packers Administration. "When I came here, I didn’t know the agency had those internal problems. You can’t fix a problem till you know you have it."

Iowa Sen. Tom Harkin, who sought the audit, said top officials were blocking investigations "and then cooking the books to cover up the agency’s lack of enforcement."

"America’s producers have faced an increasingly integrated and consolidated market, but in the past five years, USDA has made virtually no attempt to investigate or take action against unfair and anticompetitive market behavior," said Harkin, senior Democrat on the Senate Agriculture Committee.

The report didn’t give a reason for the lack of action, but Link said he didn’t think employees deliberately tried to inflate their numbers. He said employees have told him they were frustrated with management and felt they couldn’t do their jobs.

"I think there was a lot of misunderstanding between headquarters and field offices as to what really constituted investigations," he said.

While anticompetitive complaints have not been initiated since 1999, officials said there have been complaints involving financial and trade practices. There were 104 financial or trade cases referred to department lawyers from 2003 through 2005. There have been three more since Jan. 1, and several more referrals are expected in the next few days, officials said.

Under the 1921 Packers and Stockyards Act, the department is charged with investigating unfairness, deception and practices that inhibit competition in livestock, meatpacking and poultry trade.

With about 150 employees and a budget last year of $19.5 million, the Packers and Stockyards Program regulates a livestock industry worth about $120 billion.

On the Net:Agriculture Department: www.usda.gov