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ISCR Case 19-00268.a1 — CASE

ISCR Case 19-00268.a1denied

Case Headnote

ISCR Case No. 19-00268.a1

Dec 12, 2019· Hon. Michael Y. Ra'anan· appeal

Summary

The applicant, representing himself, was denied a security clearance under Guideline F (Financial Considerations) due to unmitigated financial issues. The appeal board affirmed the denial, citing a history of significant unpaid taxes and delinquent debts.

The applicant's financial obligations totaled over $170,000. These included a history of bankruptcy and substantial tax obligations. The board found that these financial problems raised security concerns that were not adequately addressed.

Despite the applicant's claims of making payment arrangements and efforts to resolve his debts, the board concluded that these actions did not sufficiently mitigate the security risks posed by his financial history. Consequently, the security clearance was denied.

Conditions Referenced

Disqualifying

AG ¶ 19raisedFinancial Considerations

Key Rule Quoted

“A clearance decision is solely a determination whether it is clearly consistent with the national interest to grant or continue a security clearance for an applicant.”

Procedural Posture

SOR issuedMar 15, 2019
Answer filed—
Hearing heldSep 18, 2019
Decision dateDec 12, 2019

Cite For

Denial of Security Clearance Due to Unresolved Financial Obligations Under Guideline F
Affirmation of a Judge's Decision When No Harmful Error Is Established
The Distinction Between Tax Obligations and Criminal Guilt in Security Clearance Adjudications.

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 argued that the Judge's analysis was inaccurate and that he was making efforts to pay his taxes. The Board affirmed the decision, finding no harmful error in the Judge's ruling.

Appealed bythe applicant

Applicant representationPro se (self-represented)

Judge belowEdward W. Loughran — denied the clearance (split findings)

Decided ona hearing

Guidelines belowGuideline F

What the Board reviewed

Decision arbitrary, capricious, or contrary to law — raised by the applicantRejected
Applicant contends that the Judge’s whole-person analysis does not accurately reflect his circumstances.

Why the Board ruled this way

The Board found that the Judge did not commit any harmful error and that the decision was sustainable on the record.

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: Applicant also states that tax professionals have told him that it is not illegal to owe taxes to the Government so long as he is making an effort to pay them. To the extent that he may be implying that his security clearance adjudication is a determination of guilt or innocence of a crime, such an assertion is incorrect. A clearance decision is solely a determination whether it is clearly consistent with the national interest to grant or continue a security clearance for an applicant. Adverse decision affirmed. CASE NO: 19-00268.a1 DATE: 12/12/2019

DATE: December 12, 2019 ) In Re: ) ) -------------- ) ISCR Case No. 19-00268 ) ) Applicant for Security Clearance ) )

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT Pro se The Department of Defense (DoD) declined to grant Applicant a security clearance. On March 15, 2019, 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 hearing. On September 18, 2019, after the hearing, Administrative Judge Edward W. Loughran denied Applicant’s request for a security clearance. Applicant appealed pursuant to Directive ¶¶ E3.1.28 and E3.1.30. The SOR alleged that Applicant filed a Chapter 13 bankruptcy petition in 2007 that was later dismissed and that he had six delinquent debts. The Judge found in favor of Applicant on the bankruptcy allegation and on four of the six alleged debts. Those favorable findings have not been raised as an issue on appeal. The Judge found against Applicant on a Federal and state tax obligation. In 2018, Applicant estimated that he owed $20,000 to the IRS. Post-hearing, Applicant indicated that the IRS informed him that he owes more than $60,000. He further stated that he submitted to the IRS a form to begin making payment arrangements but only provided the Judge a blank copy of that form. Over the years, Applicant’s state filed tax liens against him totaling about $90,000 that are no longer listed on his credit reports. However, he admitted that he owes the state more that $111,000 and indicated that he is reaching out to the state but it still has not sent him any forms. In concluding that disqualifying conditions applied, the Judge stated: Applicant has a history of financial problems, including bankruptcy, unpaid taxes, and delinquent debts. Except for about six months of unemployment, he was consistently employed, with annual income in excess of $100,000. He bought a $50,000 sports car [in 2010], but failed to pay all of his taxes. [Decision at 4-5.] The Judge also noted that Applicant purchased an SUV for $71,000 in 2011, stopped paying on the sports car and SUV, and stored the sports car at a friend’s house, in part, so that the creditor could not repossess it. Applicant eventually settled the sports car debt and the SUV was repossessed. In his whole-person analysis, the Judge considered Applicant’s honorable military service but concluded the security concerns arising from the $170,000 that he owes in Federal and state income taxes were not mitigated. In his appeal brief, Applicant contends the Judge’s whole-person analysis does not paint an accurate picture of him. He also argues that he is filing and paying his current taxes, that he had been paying past-due taxes by refund forfeitures and payroll deductions, and that he has resolved a large child support arrearage. His arguments, however, fail to establish that the Judge weighed the evidence in a manner that was arbitrary, capricious, or contrary to law. See, e.g., ISCR Case No. 15- 08684 at 2 (App. Bd. Nov. 22, 2017). Applicant also states that tax professionals have told him that it is not illegal to owe taxes to the Government so long as he is making an effort to pay them. To the extent that he may be implying that his security clearance adjudication is a determination of guilt or innocence of a crime, such an assertion is incorrect. See, e.g., ISCR Case No. 02-07555 at 4 (App. Bd., Jul. 19, 2004). A clearance decision is solely a determination whether it is clearly consistent with the national interest to grant or continue a security clearance for an applicant. See Directive ¶ 3.2. Applicant also notes that he has lost his employment since the Judge’s decision. The Directive does not permit us to consider the impact of an unfavorable decision. See, e.g., ISCR Case No. 11-13180 at 3 (App. Bd. Aug. 21, 2013). Applicant has failed to establish that the Judge committed any harmful error. The Judge examined the relevant evidence and articulated a satisfactory explanation for the decision. The decision is sustainable on this record.

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