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ISCR Case 22-00783 — CASE

ISCR Case 22-00783denied

Case Headnote

ISCR Case No. 22-00783

Mar 28, 2023· Hon. Moira D. Modzelewski· appeal

Summary

A security clearance applicant, representing himself, was denied under Guideline F (Financial Considerations) due to significant financial concerns totaling approximately $378,000. The appeal board upheld this denial, citing the recent, numerous, and ongoing nature of the applicant's debts.

The board found that the applicant failed to demonstrate responsible action to resolve these financial obligations. Specifically, the disqualifying condition AG ¶ 19 was raised, indicating a pattern of financial irresponsibility.

The applicant's arguments on appeal did not establish any harmful error in the judge's initial findings. Consequently, the denial of the security clearance was affirmed.

Conditions Referenced

Disqualifying

AG ¶ 19raisedFinancial Considerations

Key Rule Quoted

“The general standard is that a clearance may be granted only when ‘clearly consistent with the interests of the national security.’”
— Egan, 484 U.S. at 528.

Procedural Posture

SOR issuedJun 8, 2022
Answer filed—Applicant represented himself.
Hearing heldJan 31, 2023
Decision dateMar 28, 2023Appeal decision.

Cite For

Upholding Denial Based on Financial Considerations Under Guideline F
Insufficient Evidence of Responsible Action to Resolve Debts
Predictive Nature of Security Clearance Adjudications Regarding Future Judgment and Reliability.

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 erred in weighing the evidence and in finding that the debts were recent and ongoing. The Board affirmed the decision, finding no harmful error in the Judge's conclusions.

Appealed bythe applicant

Applicant representationPro se (self-represented)

Judge belowCharles C. Hale — 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 erred in weighing the evidence and in finding that the debts are recent and ongoing.

Why the Board ruled this way

The Board found that the Judge's findings and conclusions were supported by substantial evidence and that the Judge articulated a satisfactory explanation for the decision. The Board determined that the Applicant did not demonstrate harmful error in the Judge's decision.

Standard of review applied

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

Appeal Board panel

James F. Duffy — Chair
Moira Modzelewski
Allison Marie

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

APPEARANCES

_______________________________________ ) In the matter of: )

)

----- )

ISCR Case No. 22-00783

)

) Applicant for Security Clearance ) _______________________________________) Date: March 28, 2023

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 June 8, 2022, 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 September 29, 2022, the Defense Office of Hearings and Appeals (DOHA) mailed a copy of the Government’s File of Relevant Material (FORM) to Applicant and afforded him an opportunity to file objections or submit material in refutation, extenuation, or mitigation. Applicant did not submit a response to the FORM. On January 31, 2023, after considering the record, Defense Office of Hearings and Appeals (DOHA) Administrative Judge Charles C. Hale denied Applicant’s request for a security clearance. Applicant appealed pursuant to Directive ¶¶ E3.1.28 and E3.1.30. The SOR alleged eight financial concerns totaling approximately $378,000, including six consumer, utility, and medical debts that were placed for collection or charged off, and two past- due mortgage accounts. The Judge found in favor of Applicant on the minor medical debt and against him on the remaining allegations.

During his security clearance investigation, Applicant explained that in 2012 he formed an LLC to acquire and sell real estate. In 2012, he began his current job as a Defense contractor and found he had significantly less time to spend on the LLC. Then, in 2014, Applicant asserts that a lender’s erroneous action resulted in the LLC being unable to secure financing to buy new properties and make necessary repairs to others. As a result, the LLC dissolved in 2017. Decision at 3. The Judge found that Applicant’s debts are recent, numerous, and ongoing, and that he failed to demonstrate responsible action regarding the debts or that he is pursuing a course of action that has a reasonable chance of successfully resolving them. Decision at 6. On appeal, Applicant argues that the Judge erred because the record contained no evidence that Applicant has ever been alleged to be negligent in safeguarding classified information, or that he has “ever demonstrated poor self-control, lack of judgment, or unwillingness to abide by the rules and regulations” while employed by his security clearance sponsor. Appeal Brief at 1. Security clearance adjudications are predictive in nature, and it is foreseeable that individuals with prior good records may nevertheless engage in conduct or undergo circumstances that raise doubts about their future judgment or reliability. See, e.g., ISCR Case No. 03-04927 at 5 (App. Bd. Mar. 4, 2005) (citing Department of the Navy v. Egan, 484 U.S. 518, 528-529 (1988)). The Government need not wait until an individual mishandles classified information before it can make an unfavorable security clearance decision. Id. (citing Adams v. Laird, 420 F.2d 230, 238-239 (D.C. Cir. 1969), cert. denied, 397 U.S. 1039 (1970)). Rather, an unfavorable clearance decision can be based on circumstances that raise security concerns sufficient to preclude a determination that it is clearly consistently with the national interest to grant or continue a security clearance for a given applicant, and a history of financial problems is a circumstance that raises such concerns. See, e.g., ISCR Case No. 03-09483 at 4 (App. Bd. Nov. 17, 2004) (citing Egan, 484 U.S. at 528-529). The remainder of Applicant’s appeal amounts to a disagreement with the Judge’s weighing of the evidence. For example, Applicant argues that the Judge erred in finding that the debts are recent and ongoing, citing one lender’s litigation timeline for prolonging Applicant’s resolution of the debt. Appeal Brief at 1-2. These arguments, however, are not sufficient to demonstrate that the Judge weighed the evidence or reached conclusions in a manner that is arbitrary, capricious, or contrary to law. See, e.g., ISCR Case No. 06-17409 at 3 (App. Bd. Oct. 12, 2007). Applicant has not established that the Judge committed harmful error. The Judge examined the relevant evidence and articulated a satisfactory explanation for the decision, and the record evidence is more than sufficient to support that the Judge’s findings and conclusions are sustainable. “The general standard is that a clearance may be granted only when ‘clearly consistent with the interests of the national security.’” Egan, 484 U.S. at 528. “Any doubt concerning personnel being considered for national security eligibility will be resolved in favor of the national security.” Directive, Encl. 2, App. A ¶ 2(b).

ORDER

The decision is AFFIRMED. Signed: James F. Duffy James F. Duffy Administrative Judge Chairperson, Appeal Board Signed: Moira Modzelewski Moira Modzelewski Administrative Judge Member, Appeal Board Signed: Allison Marie Allison Marie Administrative Judge Member, Appeal Board