Option 1 -> "claimed" doesn't work with the "there + to be" structure grammatically.
Option 2 -> "reported" is incorrect as it doesn't fit the passive construction needed here.
Option 3 -> "were said" creates the correct passive construction "there were said to be," meaning "it was said that there were."
Option 4 -> "were told" is grammatically incorrect in this impersonal reporting structure.
Hence, Option 3: were said -> This forms the proper passive reporting structure "there were said to be," which is used to report information impersonally, indicating that people/sources claimed there were serious flaws in the design -> correct