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ISCR Case 07-17965.a1 — CASE

ISCR Case 07-17965.a1denied

Case Headnote

ISCR Case No. 07-17965.a1

Oct 29, 2008· Hon. Michael Y. Ra'anan· appeal

Summary

An unmarried accountant was denied a U.S. DOHA security clearance under Guideline F, Financial Considerations, due to a history of significant financial difficulties. The applicant's record included a Chapter 7 bankruptcy and multiple delinquent debts, which raised concerns about his ability or willingness to meet financial obligations.

Specifically, the judge identified Disqualifying Condition F3, indicating a pattern of financial irresponsibility. The applicant failed to provide sufficient evidence to demonstrate a change in financial behavior or a commitment to resolving outstanding debts.

Ultimately, the judge concluded that the applicant was unable or unwilling to satisfy his debts, leading to the denial of the security clearance.

Conditions Referenced

Disqualifying

F3appliedInability or Unwillingness to Satisfy Debts

Key Rule Quoted

“It is not clearly consistent with the national interest to grant or continue eligibility for a security clearance.”
— Department of the Navy v. Egan, 484 U.S. 518, 528 (1988)

Procedural Posture

SOR issuedMar 25, 2008
Answer filed—Applicant requested a decision on the written record.
Hearing heldAug 4, 2008Decision made by Administrative Judge Juan J. Rivera.
Decision dateOct 29, 2008Appeal Board affirmed the adverse decision.

Cite For

Financial Responsibility Under Guideline F
Impact of Bankruptcy on Security Clearance Eligibility
Evaluation of Mitigating Evidence in Financial Cases

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 decision was arbitrary and capricious. The Board affirmed the Judge's decision, finding no harmful error and concluding that the Applicant's financial history raised security concerns.

Appealed bythe applicant

Applicant representationPro se (self-represented)

Judge belowJuan J. Rivera — 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's adverse security clearance decision was arbitrary, capricious, or contrary to law.

Why the Board ruled this way

The Board found no error in the Judge's decision, affirming that the Judge properly concluded that the Applicant was unable or unwilling to satisfy his debts and had a history of not meeting financial obligations. The Board determined that the Judge's findings were supported by substantial evidence and that the decision was not arbitrary or capricious.

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
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 was discharged in Chapter 7 bankruptcy in 2001. Since then, he has acquired additional delinquent debt, two of which remain delinquent at the time of the hearing. The Judge properly concluded that Applicant was unable or unwilling to satisfy his debts and that he had a history of not meeting his financial obligations. Adverse decision affirmed. CASENO: 07-17965.a1 DATE: 10/29/2008 DATE: October 29, 2008 In Re: ------------------------------- Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 07-17965

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT Pro Se Directive ¶¶ E2.19(a), (c). The Judge did find in Applicant’s favor in regard to the $420 debt. The Defense Office of Hearings and Appeals (DOHA) declined to grant Applicant a security clearance. On March 25, 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 Defense Directive 5220.6 (Jan. 2, 1992, as amended) (Directive). Applicant requested a decision on the written record. On August 4, 2008, after considering the record, Administrative Judge Juan J. Rivera denied Applicant’s request for a security clearance. Applicant filed a timely appeal pursuant to Directive ¶¶ E3.1.28 and E3.1.30. Applicant raised the following issue on appeal: whether the Judge’s adverse security clearance decision was arbitrary, capricious, or contrary to law. Finding no error, we affirm. The Judge made the following pertinent findings of fact: Applicant is an accountant. He is unmarried and has no children. He encountered financial difficulties in 2001 and filed for Chapter 7 bankruptcy protection. He was discharged in bankruptcy late in the year. Afterward he acquired additional debt which became delinquent. One debt was in the amount of $6,640. Another was in the amount of $10,975, and the third was for $420. Applicant made payments of $50 to the first two of those debtors. However, those two debts were still delinquent at the close of the record. The Judge properly concluded that Applicant’s case raised security concerns under Guideline F, specifically that Applicant was unable or unwilling to satisfy his debts and that he had a history of not meeting his financial obligations. The record demonstrates that the Judge considered the appropriate Guideline F mitigating conditions. However, he concluded that Applicant’s delinquent debts, coming close on the heels of his discharge in bankruptcy, precluded favorable application of any of those conditions. “Applicant did not provide sufficient evidence to establish he acted responsibly and in good faith in the handling of his financial affairs . . . His overall conduct with his creditors casts doubt on his current reliability, trustworthiness, and good judgment.” Decision at 7. For similar reasons, the Judge concluded that Applicant had not met his burden of persuasion under the whole-person factors. Noting that Applicant’s status as an accountant and his recent experience with bankruptcy were sufficient to place him on notice as to the requirements for good financial health, the Judge concluded that the favorable record evidence was not sufficient to demonstrate Applicant’s worthiness for a security clearance. The Board has examined the Judge’s decision in light of the record as a whole. Applicant chose to have the case decided upon the written record, with the result that his credibility could not be evaluated in the context of a hearing. See ISCR Case No. 08-00899 at 3 (App. Bd. Jul. 29, 2008). Additionally, Applicant did not reply to the Government’s File of Relevant Material. Accordingly, the Board concludes that the Judge has drawn a rational connection between the facts found and his ultimate adverse security clearance decision, especially in light of the paucity of mitigating evidence. See ISCR Case No. 03-22861 at 2-3 (App. Bd. Jun. 2, 2006). See also 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 Judge’s decision that “it is not clearly consistent with the national interest to grant or continue eligibility for a security clearance” for Applicant is sustainable on this record. Decision at 8. See Department of the Navy v. Egan, 484 U.S. 518, 528 (1988) (“The general standard is that a clearance may be granted only when ‘clearly consistent with the interests of the national security’”). In support of his appeal Applicant has submitted new matters not contained in the record, which the Board cannot consider. See Directive ¶ E3.1.29. (“No new evidence shall be received or considered by the Appeal Board”).

ORDER

The Judge’s averse security clearance decision is AFFIRMED. Signed: Michael Y. Ra’anan Michael Y. Ra’anan Administrative Judge Chairman, 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