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ISCR Case 07-05686.a1 — CASE

ISCR Case 07-05686.a1unknown

Case Headnote

ISCR Case No. 07-05686.a1

Nov 12, 2008· Hon. Jeffrey D. Billett· appeal

Summary

This security clearance case involved a U.S. citizen, originally from Russia, with concerns raised under Guideline B (Foreign Influence) and Guideline E (Personal Conduct). The applicant had close family and a business partner residing in Russia, and had previously served in the Red Army, which collectively raised questions about potential foreign influence.

Further complicating the case, the applicant made a false statement on his security clearance application regarding foreign business connections. These issues led to the invocation of Disqualifying Conditions B2 and E2.

Ultimately, the Appeal Board reversed the Administrative Judge's initial favorable decision. The Board determined that the applicant's Russian ties, combined with the false statement, created significant doubts about his reliability and trustworthiness, especially given the current geopolitical climate. As a result, the applicant was not granted a security clearance.

Conditions Referenced

Disqualifying

B2raisedContact with a Foreign Family MemberThe applicant's regular communication with a sister in Russia creates a heightened risk of foreign exploitation.
E2raisedFalse Statement on Security Clearance ApplicationThe applicant's failure to disclose foreign business connections raises questions about his reliability.

Key Rule Quoted

“Once a concern arises regarding an Applicant’s security clearance eligibility, there is a strong presumption against the grant or maintenance of a security clearance.”
— Dorfmont v. Brown, 913 F. 2d 1399, 1401 (9th Cir. 1990), cert. denied, 499 U.S. 905 (1991).

Procedural Posture

SOR issuedNov 18, 2007
Answer filed—
Hearing heldJul 28, 2008
Decision dateNov 12, 2008Appeal Board decision reversing the Administrative Judge's ruling.

Cite For

Security Concerns Related to Foreign Influence Under Guideline B
Issues of Personal Conduct and False Statements Under Guideline E
The Presumption Against Granting Security Clearances When Concerns Are Raised.

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

Reversed

The appeal involved a security clearance decision where the Administrative Judge granted the applicant a clearance. The Department Counsel appealed, arguing that the Judge erred in his findings under Guidelines B and E. The Appeal Board found merit in the government's arguments and reversed the favorable decision, citing substantial evidence of foreign influence and personal conduct issues.

Appealed bythe Government (Department Counsel)

Applicant representationAttorney

Judge belowJohn Grattan Metz, Jr. — granted the clearance

Decided ona hearing

Guidelines belowGuideline BGuideline EGuideline JGuideline L

What the Board reviewed

Judge mis-weighed or ignored evidence — raised by the Government (Department Counsel)Error sustained
The Judge erred by concluding that the Government had not met its burden of production under Guideline B.
Judge mis-weighed or ignored evidence — raised by the Government (Department Counsel)Error sustained
The Judge's adverse decision under Guideline E fails to consider an important aspect of the case.

Why the Board ruled this way

The Board found that the Judge erred in concluding that the Government had not met its burden of production under Guideline B and failed to consider important evidence regarding Guideline E. The Judge's conclusions were not sustainable based on the record evidence.

Ignored material evidenceNo rational connection between facts and conclusion

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
Jeffrey D. Billett
James E. Moody

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 B; Guideline E; Guideline J DIGEST: Applicant has close family member and a business partner in Russia. Applicant served in the Red Army. There is also substantial evidence of a false statement. Favorable decision reversed. CASENO: 07-05686.a1 DATE: 11/12/2008 DATE: November 12, 2008 In Re: ---------- Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 07-05686

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT John Bayard Glendon, Esq., Department Counsel FOR APPLICANT Eric A. Eisen, Esq. The Judge’s favorable decision under Guidelines L and J is not at issue in this appeal. The Defense Office of Hearings and Appeals (DOHA) declined to grant Applicant a security clearance. On November 18, 2007, DOHA issued a statement of reasons (SOR) advising Applicant of the basis for that decision–security concerns raised under Guideline B (Foreign Influence), Guideline L (Outside Activities), Guideline E (Personal Conduct), and Guideline J (Criminal Conduct) of Department of Defense Directive 5220.6 (Jan. 2, 1992, as amended) (Directive). Applicant requested a hearing. On July 28, 2008, after the hearing, Administrative Judge John Grattan Metz, Jr., granted Applicant’s request for a security clearance. Department Counsel filed a timely appeal pursuant to Directive ¶¶ E3.1.28 and E3.1.30. Department Counsel raised the following issues on appeal: whether the Judge erred by concluding that the Government had not met its burden of production under Guideline B and whether the Judge’s adverse decision under Guideline E fails to consider an important aspect of the case. Finding error, we reverse.1 Whether the Record Supports the Judge’s Factual Findings A. Facts The Judge made the following pertinent findings of fact: Applicant was born in Russia, which was then a part of the Soviet Union. He immigrated from Russia in the early 1990sand to the U.S. a few years later. He became a U.S. citizen in the early 2000s. He and his wife have two children. Applicant has a sister who is a citizen and resident of Russia. His sister calls him “every few weeks” to check on Applicant and his family. Decision at 2. Russia is a “nominal democracy with a mixed human rights record . . . Russia has an active and significant information collection program focusing on the U.S. As of 2005, Russia was one of the two most aggressive collectors of sensitive and protected U.S. technology and accounted for much of such targeting. However, Russia has not been demonstrated to target U.S. citizens to obtain protected information.” Id. at 3 Applicant answered “no” to question 17a of the security clearance application (SCA). “This answer is alleged to be false because a U.S. company co-founded by Applicant (1) had business clients in [European and Asian countries, including Russia] and (2) Applicant had business partners at this company and a second company he co-founded who were resident citizens of Russia.” Id. at 2. B. Discussion The Appeal Board’s review of the Judge’s findings of facts is limited to determining if they are supported by substantial evidence–“such relevant evidence as a reasonable mind might accept as adequate to support a conclusion in light of all the contrary evidence in the same record.” Directive ¶ E3.1.32.1. “This is something less than the weight of the evidence, and the possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency’s finding from being supported by substantial evidence.” Consolo v. Federal Maritime Comm’n, 383 U.S. 607, 620 (1966). In evaluating the Judge’s findings, we are required to give deference to the Judge’s credibility determinations. Directive ¶ E3.1.32.1. The Board will consider the sufficiency of the Judge’s findings to the extent necessary to address the issues which Department Counsel has raised on appeal. Whether the Record Supports the Judge’s Ultimate Conclusions A Judge is required to “examine the relevant data and articulate a satisfactory explanation for” the decision, “including a ‘rational connection between the facts found and the choice made.’” Motor Vehicle Mfrs. Ass’n of the United States v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)(quoting Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168 (1962)). “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). The Appeal Board may reverse the Judge’s decision to grant, deny, or revoke a security clearance if it is arbitrary, capricious, or contrary to law. Directive ¶¶ E3.1.32.3 and E3.1.33.3. Once a concern arises regarding an Applicant’s security clearance eligibility, there is a strong presumption against the grant or maintenance of a security clearance. See Dorfmont v. Brown, 913 F. 2d 1399, 1401 (9 Cir. 1990), cert. denied, 499 U.S. 905 (1991). After the Government presents th evidence raising security concerns, the burden shifts to the applicant to rebut or mitigate those concerns. See Directive ¶ E3.1.15. “The application of disqualifying and mitigating conditions and whole person factors does not turn simply on a finding that one or more of them apply to the particular facts of a case. Rather, their application requires the exercise of sound discretion in light of the record evidence as a whole.” See, e.g., ISCR Case No. 05-03635 at 3 (App. Bd. Dec. 20, 2006). In deciding whether the Judge's rulings or conclusions are arbitrary or capricious, the Board will review the Judge's decision to determine whether: it does not examine relevant evidence; it fails to articulate a satisfactory explanation for its conclusions, including a rational connection between the facts found and the choice made; it does not consider relevant factors; it reflects a clear error of judgment; it fails to consider an important aspect of the case; it offers an explanation for the decision that runs contrary to the record evidence; or it is so implausible that it cannot be ascribed to a mere difference of opinion. In deciding whether the Judge's rulings or conclusions are contrary to law, the Board will consider whether they are contrary to provisions of Executive Order 10865, the Directive, or other applicable federal law. See ISCR Case No. 03-22861 at 2-3 (App. Bd. Jun. 2, 2006). See Directive ¶ E2.7(a): “contact with a foreign family member . . . or other person who is a citizen of or resident in a foreign country if that contact creates a heightened risk of foreign exploitation, inducement, manipulation, pressure, or coercion[.]” Directive ¶ E2.7(b): “connections to a foreign person, group, government, or country that create a potential conflict of interest between the individual’s obligation to protect sensitive information or technology and the individual’s desire to help a foreign person, group, or country by providing that information[.]” The Board has remanded cases in order for the Judge to make findings of fact and conclusions regarding the current geopolitical situation in Russia. See, e.g., ISCR Case No. 07-14508 at 4 (App. Bd. Oct. 22, 2008) (“The Board also notes certain events which have occurred since the close of the record and which have a bearing on this case. In August 2008 Russia attacked Georgia . . . For a discussion of official notice in DOHA proceedings, see ISCR Case No. 05-11292 at 2-4 (App. Bd. Apr. 12, 2007) . . . A current and accurate assessment of the “geopolitical situation” and the “security/intelligence profile of the country vis-a-vis the United states” is crucial in Guideline B cases. See ADP Case No. 06-14978 at 3 (App. Bd. Oct. 11, 2007); ISCR Case No. 04-02630 at 2-3 (App. Bd. May 23, 2007). In this case, Applicant has regular contact with citizens of a country that has engaged in armed conflict with a democracy friendly with the U.S. . . . This is a matter bearing on the Guideline B security concern, which requires consideration of the nature of the foreign country.”) In light of Board’s disposition of the case under consideration here, however, no point would be served in remanding it for additional findings on these matters.

In the analysis section of his decision, the Judge stated that “the [G]overnment failed to establish a disqualification under Guideline B. Considering the country involved, Russia and the U.S. enjoy competitive foreign relations, although they cooperate on a wide variety of issues. While Russia is actively engaged in the collection of U.S. information, there is no evidence suggesting that it targets its expatriate citizens . . .” Decision at 4. Department Counsel argues that the Judge erred by concluding that the Government produced no evidence of heightened risk under section 7(a) of Guideline B. Department Counsel’s argument is persuasive. The Board notes the Judge’s findings and record evidence demonstrating that Applicant has a close family member in Russia, with whom he regularly communicates; that Applicant has a business partner who at the time of the hearing was a citizen of Russia; that Applicant served in the Red Army; and that Russia is a nation with a problematic human rights record that actively seeks U.S. intelligence. Viewed as a whole, these matters are sufficient to raise a Foreign Influence security concern. As pointed out by Department Counsel, the Judge’s conclusions in this case have the practical effect of requiring Department Counsel to prove affirmatively that Russia specifically targets U.S. citizens in the course of its attempt to gather protected information. The language of the Directive (Guideline B) on this topic is inclusive and does not require this level of proof from Department Counsel in order to raise security concerns that shift the burden of persuasion to Applicant. The Judge’s conclusion on this matter is not sustainable.3 Department Counsel also challenges the Judge’s decision under Guideline E, arguing that the Judge erred in concluding that the evidence presented by the Government did not demonstrate a security concern. Question 17a of the SCA required an applicant to state whether he has any “foreign property, business connections, or financial interests.” Government Exhibit (GE) 1 at 10. As stated above, Applicant answered “no” to this question. The Board notes GE 2 at 6, which is a summary of Applicant’s security clearance interview. This exhibit describes Applicant as identifying a foreign national (FN) with whom he was, at the time of the interview, a partner in a business Applicant testified that, from an early age, he perfected his English by reading widely in American literature, including the works of James Fenimore Cooper, Jack London, and Theodore Dreiser. Tr. at 45. Directive ¶ E2.15: “conduct involving questionable judgment, lack of candor . . . can raise questions about an individual’s reliability, trustworthiness, and ability to protect classified information. Of special interest is any failure to provide truthful and candid answers during the security clearance process . . .” The Judge did not permit Department Counsel to question Applicant as to what kind of information he understood Question 17a to be soliciting. The Board concludes that Applicant’s understanding of the meaning of this question is relevant and a proper matter for cross-examination. venture involving software development. The Board also notes Applicant’s response to the SOR, and the Judge’s findings of fact, concerning another company founded by Applicant and which has foreign clients in Europe, Asia, and Russia. The names of these clients suggest that they are companies engaged in business activities. GE 3, Answers to Interrogatories, at 4. Under the facts of this case, Applicant’s SOR response and the other record evidence described above; Applicant’s apparent command of English, his formal education, and business experience; and the clarity of the question at issue here constitute substantial evidence of a false statement concerning foreign business connections, which raises security concerns under Guideline E. The Judge’s conclusion that the Government had not presented security concerns under Guideline E is not sustainable on this record. Furthermore, the Judge’s conclusion that Applicant did not willfully falsify his SCA is not sustainable in light of the contrary evidence in the record. The Board pays special attention to GE 2 at 6, in which Applicant explained why he left FN’s name off his SCA. “This contact is not reported on his security form because it is a business relationship, and when he was required to fill out the form for the [interview], he did not want information to be conflicting from original security paperwork.” Although this comment is not elsewhere elaborated upon, it does raise a reasonable impression that Applicant acted with deceptive intent in answering relevant questions. Additionally, this comment does not appear consistent with Applicant’s testimony at the hearing to the effect that he left FN’s name off the SCA because, although a Russian citizen, FN resides in the U.S. Tr. at 106-7. The Judge’s decision does not address this apparent contradiction, nor does he assess Applicant’s credibility in light of it. Therefore, the Judge has failed to consider an important aspect of the case. The record as a whole does not support a conclusion that Applicant has met his burden of persuasion in light of the Egan standard. Therefore, the Judge’s ultimate decision is not sustainable.

ORDER

The Judge’s favorable security clearance decision is REVERSED. Signed: Michael Y. Ra’anan Michael Y. Ra’anan Administrative Judge Chairman, Appeal Board Signed: Jeffrey D. Billett Jeffrey D. Billett Administrative Judge Member, Appeal Board Signed: James. E. Moody James E. Moody Administrative Judge Member, Appeal Board