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ISCR 07-10448.a1: Guideline F security clearance appeal, denied (2009) · CASE

ISCR Case 07-10448.a1denied

Case headnote

ISCR Case No. 07-10448.a1

Jun 25, 2009· Hon. Jean E. Smallin· appeal

Summary

A security clearance applicant, representing himself, was denied clearance under Guideline F (Financial Considerations) due to a history of unfiled tax returns and outstanding tax debts. The applicant failed to file federal income tax returns from 2001 through 2006 and state income tax returns from 1992 through 2006.

This resulted in the IRS filing a lien for $8,844 against the applicant in 2001, and state tax authorities filing two liens totaling $9,148 in 2006. A judgment for debt was also issued.

During the proceedings, the applicant did not provide documentation of payment for these tax liens or other debts, nor did he file the overdue tax returns before the hearing. The judge found insufficient evidence to mitigate the financial concerns, leading to the denial of the security clearance.

Conditions referenced

Disqualifying

AG ¶ 20raisedFinancial Considerations

Mitigating

AG ¶ 21(a)rejectedThe Behavior Was Not RecentThe applicant's financial issues were ongoing and not resolved.
AG ¶ 21(b)rejectedThe Conditions That Resulted in the Behavior Were Beyond the Person's ControlThe applicant's unemployment and financial obligations did not mitigate the security concerns.
AG ¶ 21(c)rejectedThe Person Has Taken Positive Steps to Reduce or Eliminate Vulnerability to ExploitationThe applicant did not provide sufficient evidence of efforts to resolve tax liabilities.

Key rule quoted

“The presence of some mitigating evidence does not alone compel the Judge to make a favorable security determination.”

Procedural posture

SOR issuedOct 3, 2008
Answer filed—Applicant represented himself.
Hearing heldFeb 20, 2009
Decision dateJun 25, 2009

Cite for

Denial of Security Clearance Based on Failure to File Taxes Under Guideline F
Insufficient Evidence of Mitigation in Financial Considerations Cases
The Judge's Discretion in Weighing Evidence and Making 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 a denial of a security clearance based on the Applicant's failure to file federal and state income taxes over several years. The Applicant argued that the Judge's decision was arbitrary and did not adequately consider his mitigation efforts. The Board affirmed the Judge's decision, finding no harmful error in the proceedings.

Appealed bythe applicant

Applicant representationPro se (self-represented)

Judge belowRobert C. Wesley denied the clearance

Decided ona hearing

Guidelines belowGuideline F

What the Board reviewed

Decision arbitrary, capricious, or contrary to law, raised by the applicantRejected
Applicant argued that the Judge's 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 Judge properly weighed the evidence presented by the Applicant.

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

Jean E. Smallin
William S. Fields
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 F DIGEST: Applicant failed to file federal income taxes from 2001 through 2006 and state income taxes from 1992 through 2006. Adverse decision affirmed. CASENO: 07-10448.a1 DATE: 06/25/2009 DATE: June 25, 2009 In Re: ------ Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 07-10448

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT Pro Se The Defense Office of Hearings and Appeals (DOHA) declined to grant Applicant a security clearance. On October 3, 2008, DOHA 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 February 20, 2009, after the hearing, Administrative Judge Robert C. Wesley denied Applicant’s request for a security clearance. Applicant appealed pursuant to the Directive ¶¶ E3.1.28 and E3.1.30. Applicant raises the following issue on appeal: whether the Judge’s decision is arbitrary, capricious, or contrary to law. The Judge made the following factual findings: Applicant failed to file federal income tax returns for the years 2001 through 2006 and state income tax returns for the years 1992 through 2006. As a result, the Internal Revenue Service (IRS) filed a lien for $8,844 against Applicant in 2001, and state tax authorities filed two liens totaling $9,148 in 2006. Due to another debt, Applicant incurred a judgement for $892 in 2000. Applicant has not provided documentation of payment of any of those amounts or of five other delinquent debts. Due to a period of unemployment, Applicant fell behind on child-support payments and his other financial obligations. He now owes only back-payments for child support. In December 2008, Applicant hired a tax relief firm to file his tax returns and settle his tax liabilities. Applicant then filed an installment agreement request with the state tax authorities and executed a power of attorney for the firm to represent him in negotiations with the IRS. However, as of the date of the hearing (December 15), Applicant had not filed any of the overdue tax returns or made any payments toward the tax liens. Although the record was held open for Applicant to submit completed tax returns, installment agreements, and other evidence of his efforts to resolve his tax liabilities and other debts, Applicant did not submit “tangible evidence” in that regard. Decision at 3-4. It was not clear at that time whether Applicant had paid the $3,900 charged by the tax relief firm for their services. Applicant had agreed to pay the firm $1,950 by January, but provided no documentation of payment. Along with his appeal, Applicant submitted completed federal tax forms and correspondence from the IRS. Under Directive ¶ E3.1.29, the Board cannot consider this new evidence. Applicant argues that through his contacts with the IRS he has mitigated any security concerns that might exist under Guideline F and that the Judge either did not consider or did not give adequate weight to his evidence of mitigation. There is a rebuttable presumption that the Judge considered all the record evidence, unless the record demonstrates otherwise; and there is no requirement that the Judge mention or discuss every piece of record evidence when reaching a decision. See, e.g., ISCR Case No. 04-08134 at 3 (App. Bd. May 16, 2005). Applicant admitted the SOR allegations against him. The burden then shifted to Applicant to extenuate or mitigate the security concerns raised by those allegations. Directive ¶ E3.1.15. Here, the Judge discussed the possible application of relevant mitigating conditions and concluded that Applicant did not present evidence sufficient to overcome the security concerns raised. 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. Thus, the presence of some mitigating evidence does not alone compel the Judge to make a favorable security determination. As the trier of fact, the Judge has to weigh the evidence as a whole and decide whether the favorable evidence outweighs the unfavorable evidence, or vice versa. A party’s disagreement with the Judge’s weighing of the evidence, or an ability to argue for a different interpretation of the evidence, is 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. 06-23384 at 3 (App. Bd. Nov. 23, 2007).

ORDER

The Judge’s decision denying Applicant a security clearance is AFFIRMED. Signed: Jean E. Smallin Jean E. Smallin Administrative Judge Member, Appeal Board Signed: William S. Fields William S. Fields Administrative Judge Member, Appeal Board Signed: James E. Moody James E. Moody Administrative Judge Member, Appeal Board