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ISCR Case 18-01045.a1 — CASE

ISCR Case 18-01045.a1denied

Case Headnote

ISCR Case No. 18-01045.a1

May 14, 2019· Hon. Michael Y. Ra'anan· appeal

Summary

A 30-year-old male applicant with prior military service was denied a security clearance under Guideline F, Financial Considerations. The denial stemmed from his failure to file timely Federal tax returns for 2014-2016 and delinquent debts exceeding $19,000. These issues raised disqualifying conditions F.2.a and F.3.

While mitigating condition F.20(g) was considered, the applicant's explanations regarding his tax filings and efforts to resolve the debts were deemed insufficient. The Judge's decision to deny the clearance was upheld by the Appeal Board.

The Board emphasized the applicant's lack of a reliable track record in meeting tax obligations and the critical importance of fulfilling legal responsibilities for national security eligibility. Ultimately, the security clearance was denied.

Conditions Referenced

Disqualifying

F.2.araisedFailure to File or Pay Taxes
F.3raisedDelinquent Debts

Mitigating

F.20(g)rejectedThe Individual Has Made Arrangements with the Appropriate Tax Authority to File or Pay the Amount Owed and Is in Compliance with Those Arrangements.The applicant still has tax debt and failed to disclose his tax situation on his security clearance application.

Key Rule Quoted

“A person who fails repeatedly to fulfill his or her legal obligations, such as filing tax returns when due, does not demonstrate the high degree of good judgment and reliability required of those granted access to classified information.”
— ISCR Case No. 15-08782 at 3 (App. Bd. Apr. 5, 2017)

Procedural Posture

SOR issuedJul 6, 2018
Answer filed—
Hearing heldMar 5, 2019
Decision dateMay 14, 2019Appeal Board decision

Cite For

Affirmation of Denial Based on Financial Considerations Under Guideline F
Importance of Fulfilling Legal Obligations for National Security Eligibility
Insufficient Rebuttal of Presumption of Evidence Consideration by the Judge

Editorial summary generated for research. Not legal advice; not a prediction. Verify against the full decision before relying on any quoted language.

Appeal at a glance· Full written decision

Affirmed

The appeal involved a denial of a security clearance based on financial considerations under Guideline F. The applicant contended that the Judge's decision was arbitrary and did not properly consider evidence of his efforts to resolve tax issues. The Board affirmed the Judge's decision, finding no harmful error in the analysis or conclusions reached.

Appealed bythe applicant

Applicant representationAttorney

Judge belowElizabeth M. Matchinski — denied the clearance (split findings)

Decided onthe written record

Guidelines belowGuideline F

What the Board reviewed

Decision arbitrary, capricious, or contrary to law — raised by the applicantRejected
Applicant argued that the Judge's adverse decision was arbitrary, capricious, or contrary to law.

Why the Board ruled this way

The Board found that the Judge's decision was supported by substantial evidence and that the applicant's arguments did not demonstrate that the decision was arbitrary, capricious, or contrary to law.

Standard of review applied

Harmful-error gatekeeperSubstantial-evidence reviewArbitrary-and-capricious reviewProcedural complianceNo de-novo re-decisionNo new evidence on appealDeference to the judge’s credibility calls

Appeal Board panel

Michael Ra’anan — Chair
James E. Moody
James F. Duffy

Descriptive structured reading of this decided, public Appeal Board decision — what the case says, not a prediction or advice.

Full decision

The complete, official text — footnotes and signatures included — is in the original PDF.

Decision text, by section

DEFENSE OFFICE OF HEARINGS AND APPEALS

APPEAL

SYNOPSIS

KEYWORD: Guideline F DIGEST: We give due consideration to the Hearing Office case that Applicant has cited in support of his arguments, but it is neither binding precedent on the Appeal Board nor sufficient to undermine the Judge’s decision. Adverse decision affirmed. CASENO: 18-01045.a1 DATE: 05/14/2019 DATE: May 14, 2019 ) In Re: ) ) ---------------------- ) ISCR Case No. 18-01045

) ) Applicant for Security Clearance ) )

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT Ryan C. Nerney, Esq. The Department of Defense (DoD) declined to grant Applicant a security clearance. On July 6, 2018, DoD issued a statement of reasons (SOR) advising Applicant of the basis for that decision —security concerns raised under Guideline F (Financial Considerations) of Department of Defense Directive 5220.6 (Jan. 2, 1992, as amended) (Directive). Applicant requested a decision on the written record. On March 5, 2019, after considering the record, Defense Office of Hearings and Appeals (DOHA) Administrative Judge Elizabeth M. Matchinski denied Applicant’s request for a security clearance. Applicant appealed pursuant to Directive ¶¶ E3.1.28 and E3.1.30. Applicant raised the following issue on appeal: whether the Judge’s adverse decision was arbitrary, capricious, or contrary to law. Consistent with the following, we affirm. The Judge’s Findings of Fact and Analysis Applicant is 30 years old and unmarried. He served in the military and was granted a security clearance in 2006. Following his military discharge in 2012, he was unemployed for about a year before attending college. For portions of 2015 and 2016, he worked overseas. For portions of 2016 and 2017, he was unemployed as a full-time student. He has not yet earned a degree. In 2017, he began working for a defense contractor. The SOR alleged that Applicant failed to file timely his Federal tax returns for 2014-2016 and that he had four delinquent debts totaling over $19,000. He filed his 2014 Federal tax return in April 2016. He paid one of the alleged debts in 2016 and has repayment plans in place for two other debts. In August 2018, he filed his Federal tax returns for 2015-2017. He thought that he could not file his 2015-2017 Federal tax returns until he paid a $1,000 debt owed to a former employer. After consulting with a tax preparer, he was advised the delinquent tax returns could be filed without first paying the debt. The Judge found in favor of Applicant on three alleged debts and against him on the Federal tax-filing allegation and a $328 debt owed to the U.S. Government. His Federal tax returns for 2015 and 2016 were not filed until after he received the SOR. “Even where tax problems have been corrected and an applicant is motivated to prevent such problems in the future, the administrative judge is not precluded from considering an applicant’s trustworthiness in light of longstanding prior behavior evidencing irresponsibility.” Decision at 10, citing ISCR Case No. 14-01894 at 4-5 (App. Bd. Aug. 18, 2015). Applicant has yet to show a track record of complying with tax-filing deadlines. The Judge also noted that Applicant disputes the $328 U.S. Government debt due to his lack of knowledge about it, but he submitted no documentation establishing it is not his responsibility. Furthermore, he has not shown any effort to investigate that debt, which is on his credit report.

DISCUSSION

Applicant contends that the Judge did not consider all of the record evidence and did not properly apply the facts of the case to the mitigating conditions. He argues, for example, that the Judge disregarded evidence that shows he filed all of his tax returns and hired a tax professional to resolve other outstanding issues. He further claims the Judge erred by failing “to realize the steps [he] has taken to remedy his past tax issues” and erred by not concluding Mitigating Condition 20(g) was fully applicable.1 Appeal Brief at 9-10. Applicant’s arguments, however, are neither sufficient to rebut the presumption that the Judge considered all of the evidence in the record nor enough to show that the Judge weighed the evidence in a manner that was arbitrary, capricious, or contrary to law. See, e.g., ISCR Case No. 17-03978 at 3-4 (App. Bd. Mar. 6, 2019). We give due consideration to the Hearing Office case that Applicant has cited in support of his arguments, but it is neither binding precedent on the Appeal Board nor sufficient to undermine the Judge’s decision. Id. The Judge discussed Mitigating Condition 20(g) and noted Applicant still has tax debt and failed to disclose his tax situation on his security clearance application. She also considered applicable case law. There is no reason to disturb her analysis under 20(g). The Judge examined the relevant evidence and articulated a satisfactory explanation for the decision. A person who fails repeatedly to fulfill his or her legal obligations, such as filing tax returns when due, does not demonstrate the high degree of good judgment and reliability required of those granted access to classified information. See, e.g., ISCR Case No. 15-08782 at 3 (App. Bd. Apr. 5, 2017). The decision is sustainable on this record. “The general standard is that a clearance may be granted only when ‘clearly consistent with the interests of the national security.’” Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). See also Directive, Encl. 2, App. A ¶ 2(b): “Any doubt concerning personnel being considered for national security eligibility will be resolved in favor of the national security.” 1 Directive, Encl. 2, App. A ¶ 20(g) states, “the individual has made arrangements with the appropriate tax authority to file or pay the amount owed and is in compliance with those arrangements.”

ORDER

The Decision is AFFIRMED. Signed: Michael Ra’anan Michael Ra’anan Administrative Judge Chairperson, Appeal Board Signed: James E. Moody James E. Moody Administrative Judge Member, Appeal Board Signed: James F. Duffy James F. Duffy Administrative Judge Member, Appeal Board