Is a real estate agent libel if they submit and offer on a HUD property, for a client, as an "investor"... if the agent does not advise the client that HUD, unlike a conventional loan, HUD will not refund the earnest money if the contract is cancelled due to a poor house inspection?

What was written in the offer ? But there are many offers where you can not cancel offer due to inspection.

The terms are in the contract that is signed, so did you sign the offer with the terms, what was the actual terms in the offer contract

I will assume this was a foreclosure sale ? Most foreclosure sales and many though the banks have no cancel for inspection.
That is why before you make the offer you have to look closely at it, and why of course the offers and sell prices are much lower.

I have looked every page of the HUD documents over... there is absolutley nothing in those documents that states anything about the earnest money not being returned or that money is not returned to an invester. The real estate agent even lied to me when I asked him why the money was not being returned... telling me that it was because of a missed deadline... which there was no deadline of anykind that was missed. I did not find out the real reason why I wasn't getting the earnest money back until I called the company that was handling the transaction for HUD... they told me why and that was the first I ever learned why I wasn't getting the money back. I've been in contact with them trying to get my money back... as the bottom line is... I am not and have never been an invester. So does the agent have any liability on this matter??

Hud does not have the earnest money, the broker ( has to be a broker) holds the earnest money.

1. talk to the broker ( not agent) directly, be sure it was placed in the proper account.
2. ask to see in the offer payment work, where you put down, you have to add it to the offer, that you have the right to resend offer if the inspection does not meet requirements.
3. then after HUD accepts the offer, if your inspection fails, you can cancel, if you did not put that term in your offer, you don't have that right. You have to fill in all of your rights, the statement that they get to keep it will not be there, but you are bound to the contract, unless you put terms like home condition or ability to get loan and so on in it