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ISCR Case 19-01846.a1 — CASE

ISCR Case 19-01846.a1denied

Case Headnote

ISCR Case No. 19-01846.a1

Sep 9, 2020· Hon. Michael Y. Ra'anan· appeal

Summary

An applicant, represented by counsel, was denied a security clearance due to concerns under Guideline F (Financial Considerations) and Guideline E (Personal Conduct). The denial was primarily based on the applicant's significant delinquent student loan debt, which totaled over $238,000.

The applicant failed to demonstrate a sufficient track record of resolving these debts. A key factor in the denial was the applicant's decision to prioritize paying for his children's educational expenses over addressing his own outstanding financial obligations, a choice deemed to be within his control.

The Appeal Board affirmed the denial, citing Disqualifying Conditions F3 and E2. Ultimately, the applicant was denied the security clearance.

Conditions Referenced

Disqualifying

F3raisedInability or Unwillingness to Satisfy Debts
E2raisedPersonal Conduct That Creates a Risk of Adverse Impact on National Security

Key Rule Quoted

“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)

Procedural Posture

SOR issuedJun 26, 2019
Answer filed—
Hearing heldJun 16, 2020
Decision dateSep 9, 2020

Cite For

Financial Considerations Under Guideline F
Personal Conduct Issues Under Guideline E
Importance of Demonstrating Debt Resolution in Clearance Determinations

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 an applicant seeking a security clearance who was denied due to financial considerations and personal conduct issues. The applicant raised several issues on appeal, including claims of untimeliness in the Judge's decision and errors in the Judge's findings. The Board affirmed the Judge's decision, finding no harmful errors in the proceedings.

Appealed bythe applicant

Applicant representationAttorney

Judge belowJohn Grattan Metz, Jr. — denied the clearance

Decided ona hearing

Guidelines belowGuideline FGuideline E

What the Board reviewed

No specific harmful error alleged — raised by the applicantRejected
Applicant argued that the Judge failed to issue a decision in a timely fashion.
Judge mis-weighed or ignored evidence — raised by the applicantRejected
Applicant contended that the Judge’s findings of fact contained errors.
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 did not demonstrate any harmful error in the Judge's findings or conclusions. The Board affirmed the Judge's decision based on the evidence presented and the applicable standards.

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 Y. 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; Guideline E DIGEST: Appeal Board does not have supervisory authority over other DOHA personnel involved in processing security clearances. Adverse decision affirmed. CASE NO: 19-01846.a1 DATE: 09/09/2020 DATE: September 9, 2020 ) In Re: ) ) ---------------------- ) ISCR Case No. 19-01846

) ) Applicant for Security Clearance ) )

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT Julie R. Mendez, Esq., Deputy Chief Department Counsel FOR APPLICANT Leon J. Schachter, Esq. The Department of Defense (DoD) declined to grant Applicant a security clearance. On June 26, 2019, DoD issued a statement of reasons (SOR) advising Applicant of the basis for that decision–security concerns raised under Guideline F (Financial Considerations) and Guideline E (Personal Conduct) of Department of Defense Directive 5220.6 (Jan. 2, 1992, as amended) (Directive). Applicant requested a hearing. On June 16, 2020, after the hearing, Defense Office of Hearings and Appeals (DOHA) Administrative Judge John Grattan Metz, Jr., denied Applicant’s request for a security clearance. Applicant appealed pursuant to Directive ¶¶ E3.1.28 and E3.1.30. Applicant raised the following issues on appeal: whether the Judge failed to issue a decision in a timely fashion; whether the Judge’s findings of fact contained errors; whether the Judge erred by not addressing Applicant’s request for a conditional grant of a clearance in accordance with Directive, Encl. 2, App. C; and whether the Judge’s adverse decision was arbitrary, capricious, or contrary to law. The Judge’s favorable findings under Guideline E are not at issue in this appeal. Consistent with the following, we affirm the Judge’s decision. The Judge’s Findings of Fact and Analysis The Judge made the following findings pertinent to the issues raised on appeal: Applicant’s SOR alleges two delinquent student loan accounts totaling over $238,000. Applicant incurred these debts while pursuing graduate studies from 1989 until 1995. Applicant contended that he had made payments on these loans when the post-graduate grace period expired in the late 1990s. However, because the size of his family grew along with attendant financial responsibilities, Applicant obtained deferments. Although a collection agent began contacting him in 2014, Applicant took no steps to repay. His own children were by then in college, and he decided to pay their tuition so as not to burden them with loans. He paid their college expenses through his current income. When confronted with his delinquent loans during his 2018 clearance interview, Applicant stated an intent to make payment arrangements. However, during a follow-on interview a few months later, he had not made contact with the creditor. He finally reached out to the creditor in early 2019 and began the process of rehabilitating the loans. He entered into a rehabilitation plan about a month later and made the required payments. By the close of the record, Applicant was awaiting the details of a regular repayment plan, which might entail greater monthly payments than he is currently making. He claims to have the necessary income to pay the more than $237,000 that he still owes on these loans and that, “in a pinch,” his assets are sufficient to resolve the debts in full. His credit reports disclose no other financial problems. Decision at 2. Applicant submitted character references from two co-workers, a long-time friend, and his oldest child. Each of these references describe him as honest and trustworthy, and they all recommend him for a clearance. However, none of these persons disclosed knowledge of the government’s security concerns regarding Applicant’s finances. The Judge concluded that Applicant met none of the Guideline F mitigating conditions. He characterized Applicant’s education loans as recent because they are ongoing and stated that they were not due to circumstances unlikely to recur. He cited to evidence that Applicant prioritized his children’s educational debts over paying off his own financial obligations, which was a circumstance within his control. Applicant has had no financial counseling and his SOR debts are only “half-way to being resolved.” Decision at 4. Though noting Applicant’s having made rehabilitation payments, the Judge concluded that Applicant had not demonstrated a sufficient track record of debt resolution. He reiterated his finding that none of Applicant’s character references appeared to know about his security-significant financial problems.

DISCUSSION

Applicant argues that the Judge took over six months to issue his decision, which he contends does not comply with the requirements of Directive ¶ E3.1.25 that the Judge “shall make a written clearance decision in a timely manner[.]” He contends that had the Judge issued a timely decision, the facts would have been clearer in his mind and he would not have made the other errors raised in his appeal. However, as Applicant himself notes, the Directive does not define the term “timely manner.” Neither does it impose actual time standards on Judges. Despite his claim that the Judge acted through faulty memory, Applicant does not articulate how his rights were actually impaired by the the elapse of time between the hearing and the issuance of the decision. Furthermore, the Appeal Board does not have supervisory authority over other DOHA personnel involved in processing security clearances. See, e.g., ISCR Case No. 17-04097 at 2 (App. Bd. Apr. 30, 2019). Applicant has not demonstrated that he was denied the due process rights afforded by the Directive. See, e.g., ISCR Case No. 12-09421 at 3 (App. Bd. Oct. 2, 2018). Applicant contends that the Judge’s findings of fact contained misstatements. Among other things, he takes issue with the Judge’s finding that none of his character references knew about his security-significant circumstances. In fact, none of these references explicitly disclose knowledge of Applicant’s delinquent financial loans. Although it is possible that Applicant’s daughter may have been aware of his problems, given her close relationship to him, it is far from certain that such is the case. After considering the record as a whole, we conclude that the Judge’s material findings of security concern are supported by substantial evidence or constitute reasonable inferences that could be drawn from the evidence. Applicant has cited to no harmful error in the Judge’s findings. See, e.g. ISCR Case No. 18-02581 at 3 (App. Bd. Jan. 14, 2020). At the close of the hearing, during final argument, Applicant requested that the Judge grant him a conditional clearance in accordance with Directive, Encl. 2, App. C. Tr. at 96. Obviously, the Judge did not act favorably upon this request, nor did he address it in his decision. Applicant urges us to remand the case to the Judge for a new decision in which he presents his reasoning for not granting a conditional clearance. We note the Judge’s analysis, which is consistent with the record that was before him. The record evidence–which includes Applicant’s decision not to pay his student loans over a course of years and the nearly $240,000 still owed despite Applicant’s apparent ability to pay–supports a decision not to grant a conditional clearance. Applicant has not articulated a persuasive reason for us to remand the Decision to the Judge. On this issue, as well as in regard to his challenge to the Judge’s mitigation analysis as a whole, Applicant is merely expressing a disagreement with the Judge’s weighing of the evidence, which is not 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. 18-02581 at 4. The Judge examined the relevant evidence and articulated a satisfactory explanation for the decision. 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.”

ORDER

The Decision is AFFIRMED. Signed: Michael Y. Ra’anan Michael Y. 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