The 350 falsified reports represent only a small percentage of the number of background investigations conducted each year, either by OPM's own investigators or a handful of private contractors it uses for most of the work.
The Government Accountability Office testified to a congressional committee in June that OPM received over $1 billion to conduct more than 2 million background investigations for government employees in fiscal 2011.
But the details of the cases show how cracks in the system may allow employees to obtain clearances without proper vetting.
In one case, a private contractor investigator, who pleaded guilty to making a false statement, reported interviewing a person who had died more than a decade earlier. Another investigator was found guilty of making false statements in checks for applicants seeking "top secret" clearances for jobs in the Air Force, Army, Navy and U.S. Treasury.
The highest number of convictions, 11, involved special agents for OPM. Another seven convictions were of employees of USIS, a Virginia-based company that has come under scrutiny for its role in vetting former National Security Agency contractor Edward Snowden and more recently, Washington Navy Yard shooter Aaron Alexis.
Two of those USIS investigators had the highest number - more than four dozen each - of flawed background check reports sent to OPM, court documents showed.
USIS faces an ongoing investigation by OPM's inspector general. The company declined to comment for this story and OPM's inspector general's office would not comment on its probe.
The most severe punishment was given to an investigator who did not take a plea agreement and instead went to trial. This investigator was found guilty of six counts of making false statements and sentenced to 27 months in prison.
Those who entered plea agreements generally received sentences of probation and community service, courts records show.
ALEXIS, SNOWDEN CLEARANCES
In pressing the cases, prosecutors have required defendants to pay more than $1.5 million in restitution to the U.S. government to recover the costs of redoing improper background investigations.
The screening process for security clearances has came under heightened scrutiny this year since Snowden, working as a contract employee assigned to the National Security Agency, used his "top-secret" clearance to access documents on the agency's electronic eavesdropping that he later gave to the news media.
The issue resurfaced last week with reports that Alexis held a "secret" security clearance despite violent episodes before and after he received it.
A secret clearance generally lasts 10 years. Ongoing checks are needed because "in five to 10 years stuff happens and people change," a Senate aide said on condition of anonymity.
OPM contracts out for most of the background check work. But the decision to grant security clearances rests with the government agency that intends to employ the individual.
USIS conducts about 65 percent of the background checks done by private contractors, and more than half of all the investigations conducted by the OPM, according to a statement issued last week by the office of Senator Claire McCaskill, a Missouri Democrat who is a co-sponsor of legislation aimed at boosting oversight of the security clearance process.
Investigators for other government contractors, including CACI International Inc, were also convicted of making false statements in reports for security clearance background checks. CACI did not immediately respond to a request for comment.
A Senate aide said the USIS investigation by OPM's inspector general revolves around systemic problems in the company's procedures and does not focus on individual investigators.
The inspector general also is investigating the background check done for Alexis before he received clearance to work for the Navy.
In 2012, there were 3.5 million federal employees and 1.1 million contractors who held a "secret" or "top secret" clearance and OPM's security clearance and background investigations cost about $1 billion, McCaskill's office said.
The OPM inspector general's office told Reuters it has 68 open cases related to OPM's background investigations program. It did not say how many of those involve report falsifications.
The inspector general's office said it has referred 22 former background investigators for debarment, but no decisions have been reached by OPM. A debarment is usually for a specific time period and means the person cannot contract with another federal agency.
The Senate Homeland Security Committee has scheduled an October 1 hearing on government clearances and background checks.
(Reporting by Tabassum Zakaria; Editing by Marilyn W. Thompson and Tim Dobbyn)