EXCLUSIVE: The U.S. State Department has taken a symbolic step to withhold money from a United Nations organization, in order to show concern about the ethical standards and whistle-blower protection at the scandal-tarred World Intellectual Property Organization, or WIPO.

The amount of money involved is puny -- less than $370,000 -- compared to the billions in support that the Obama administration gives to the U.N. annually. In 2010, it ceased compiling the annual total. It also doesn’t matter much to WIPO, which gets 94 percent of its $674 million budget for 2014-2015 from fees through its patent services.

But it is the first time that the Obama administration has decided not to certify the ethics and whistle-blower behavior of any U.N. agency as  “best practices” under a section of this year’s Appropriations Act that mandates at 15 percent withholding of U.S. contributions if an agency -- or the U.N. itself -- fails to meet the test.

The decision also turns a spotlight back onto WIPO, a little-known Geneva-based organization  that safeguards and allows access to the world’s patent system and other intellectual property -- and its highly controversial two-term director general, Francis Gurry, whose autocratic behavior has increasingly ruffled feathers in Washington and other capitals.

The U.S., by far the largest filer of international patents under the treaties administered by WIPO, has a huge stake in the welfare of the organization.

It is the first time that the Obama administration has decided not to certify the ethics and whistle-blower behavior of any U.N. agency.

In 2012, however, an investigative committee picked by Gurry himself found “inexplicable’ and “unfathomable” a WIPO decision to provide sensitive U.S.-made computers and other high-tech equipment to North Korea and Iran as part of a renovation of WIPO facilities, without informing the U.N.’s committees that monitored sanctions against the two countries.

A year later, countries participating in WIPO’s annual assembly learned that Gurry had agreed to open new offices in Russia and China without asking for approval.

Early this year, U.S. diplomats faced an uphill battle over changes in a WIPO-administered treaty known as the Lisbon Agreement for the Protection of Appellations of Origin that expanded protections favored by European interests that crimp competition from the U.S. and elsewhere. WIPO denied non-signatories of the agreement -- the U.S. among them -- the right to vote on the issue.

Australian-born Gurry’s actions are currently being investigated by the U.N. itself after one of his top deputies, James Pooley, in April 2014 blew the whistle on longstanding charges that the WIPO chief ordered break-ins at the offices of his own staffers in 2008 to seek DNA evidence that they wrote anonymous letters against him.

All the staffers Gurry had allegedly suspected were cleared, after their diplomatic immunity was temporarily lifted and their DNA formally checked by Swiss police. (Pooley was not one of those allegedly burglarized.) The break-ins were discovered by one of the staffers after they obtained police lab reports on the issue and discovered that DNA samples had been taken months before the formal police checks.

In his “Report of Misconduct,” Pooley termed Gurry’s alleged behavior “serious misconduct” and “violations of national and international law,” and called for Gurry’s suspension pending an independent investigation. Gurry denied the charges, calling them “without foundation.”

Pooley’s accusations had previously been put forward years earlier by other former WIPO staffers in U.N. tribunals that consider internal justice matters, but with no outcome.

At the time of Pooley’s complaint, nothing much happened. It took until May 2015 before the U.N. Secretariat’s watchdog agency, the Office of Internal Oversight Services (OIOS), finally moved to probe the matter.

Pooley, then head of WIPO’s strategic Innovation and Technology branch, also lodged a retaliation complaint against Gurry in October 2014; the details remain confidential. 

A U.S. patent expert who was nominated for his WIPO job by the Obama administration in 2009, Pooley left the U.N. organization a month later to return to private practice in California. At that point, WIPO’s ethics office, according to a U.S. State Department official, “ceased its review of the [retaliation] case.”

“The delay of almost a year in starting an external investigation and identifying an external investigative agent in the misconduct report is of concern,” a State Department official told Fox News, in explaining the decision to withhold the percentage of financial support.

The official also noted that WIPO’s ethics officer position -- the office responsible for making an initial decision whether retaliation against a staffer had taken place -- had been vacant “for a long period of time.”

“This lengthy delay in naming an ethics officer undermines the credibility of the office and could be construed as lackluster support from WIPO leadership of this vital function,” the official added.

Questions to WIPO from Fox News asking for reaction to the State Department actions had not been answered before this article was published.  The U.N.’s watchdog OIOS also did not respond to questions about the continuing probe of WIPO.

Pooley, for one, applauded the State Department action -- but with major reservations.

“The issue is much deeper and more troubling than just staffing WIPO’s Ethics Office with temporary personnel,” he told Fox News. “I filed a complaint of retaliation on Oct. 8, 2014, almost two months before my term at WIPO ended, and the agency at first did nothing about it.”

“If whistle-blowers’ claims of retaliation are not even considered on their merits, then no individuals will ever take the risk of reporting, no matter who is running the Ethics Office.”

Miranda Brown, a former Australian government official who reported Gurry’s alleged role in illegal DNA collection as far back as 2012, also applauded the U.S. government’s concerns about whistle-blower protection at WIPO, which she feels cost her not one but two U.N. jobs.

“I was forced to leave WIPO” -- she served as a senior adviser to Gurry -- “after reporting the wrongdoing,” she told Fox News in a statement, “due to lack of whistle-blower protection.” She moved to a job at the U.N.’s Office of the High Commissioner for Human Rights (OHCHR) at the end of that year.

But then, Brown adds, within days of being called to testify in a glacial WIPO investigation of Gurry’s alleged misdeeds, “my contract at OHCHR was suddenly not renewed and when I challenged this I was transferred to Fiji, with immediate effect.”  Brown did not take the job and is still seeking reinstatement at OHCHR in Geneva.

Nonetheless, the move was hailed as an “important gesture” by Bea Edwards, international program director at the Government Accountability Project (GAP), a Washington-based whistle-blower protection organization that lobbied long and hard for the funding restriction rule.

GAP was a major lobbyist for the 2014 law change that levied the penalty in the first place, using as an example the case of James Wasserstrom, a U.S. State Department official who was essentially driven out of a U.N. job in Kosovo after blowing the whistle on a huge procurement scandal. A U.N. tribunal last year ordered the organization to give Wasserstrom $65,000 in compensation; he had asked for $3.2 million.

But even as she applauded the “gesture,” Edwards noted that the vulnerability of whistle-blowers “is a deep-seated problem throughout the UN system, with a structural conflict of interest at its core: whistle-blowers’ remain at the mercy of officials implicated in the wrongdoing exposed.”

Brett Schaeffer, a specialist in U.N. finances at the conservative Heritage Foundation, puts the issue more bluntly. “What we see in the U.N. system is a repeated pattern of hostility and retaliation against people who actually step forward and try to inform the public of the corruption, mismanagement and other serious problems that go otherwise unnoticed, ignored or unchanged.”

“This case is low-hanging fruit for the State Department,” Schaefer added. “The surprising thing is that they didn’t find far more.” 

Pooley offered up his own challenge for the State Department: “If the U.S. government truly believes in the principle that whistle-blowers are often the only source of information about wrongdoing, then it should blow the whistle itself, report the facts and call attention to them.”

The State Department’s view of the problem is much more muted. “We are committed to working with WIPO leadership to address these issues and help the organization come into compliance with the whistle-blower protection criteria outlined in this law,” a State Department official told Fox News.

George Russell is editor-at-large of Fox News and can be found on Twitter:  @GeorgeRussell or on Facebook.com/GeorgeRussell