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ISCR Case 11-08546.a1 — CASE

ISCR Case 11-08546.a1denied

Case Headnote

ISCR Case No. 11-08546.a1

Feb 27, 2013· Hon. Jeffrey D. Billett· appeal

Summary

An applicant, represented by counsel, was denied a security clearance under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The denial stemmed from unresolved financial issues and deliberate false statements made on security clearance applications.

The judge determined that the applicant's financial problems were not under control, indicating a lack of judgment. Furthermore, the applicant's intentional false statements on official forms significantly undermined his credibility. The applicant failed to offer reasonable explanations for his financial difficulties and did not demonstrate responsible actions to address his debts.

The applicant's claims of bias and assertions of mitigating circumstances were rejected. The decision to deny the security clearance was based on the persistent financial concerns and the deliberate misrepresentations, which together raised significant security concerns.

Conditions Referenced

Disqualifying

AG ¶ 16raisedFinancial Considerations
AG ¶ 15raisedPersonal Conduct

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 issuedJul 23, 2012
Answer filed—
Hearing heldNov 29, 2012
Decision dateFeb 27, 2013

Cite For

Denial of Security Clearance Based on Financial Issues Under Guideline F
Deliberate False Statements in Security Clearance Applications Under Guideline E
Lack of Control Over Financial Problems as a Disqualifying Factor

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 issues and false statements on security clearance applications. The applicant raised several issues on appeal, including claims of bias and errors in the Judge's findings. The Board affirmed the Judge's decision, finding no harmful errors in the original ruling.

Appealed bythe applicant

Applicant representationAttorney

Judge belowJuan J. Rivera — denied the clearance

Decided ona hearing

Guidelines belowGuideline FGuideline E

What the Board reviewed

Decision arbitrary, capricious, or contrary to law — raised by the applicantRejected
Applicant contended that the Judge was biased against him.
Erroneous finding of fact — raised by the applicantRejected
Applicant argued that the Judge erred in some of his findings of fact.
Judge mis-weighed or ignored evidence — raised by the applicantRejected
Applicant claimed that the Judge failed to consider all of the record evidence.
Mitigation wrongly applied / not applied — raised by the applicantRejected
Applicant contended that the Judge erred in his application of the mitigating conditions.
Whole-person analysis — raised by the applicantRejected
Applicant argued that the Judge’s whole-person analysis was erroneous.

Why the Board ruled this way

The Board found that the Judge's conclusions regarding the applicant's financial problems and false statements were supported by substantial evidence and that the Judge applied the relevant legal standards appropriately.

Standard of review applied

Harmful-error gatekeeperSubstantial-evidence reviewArbitrary-and-capricious reviewProcedural complianceNo de-novo re-decisionDeference to the judge’s credibility calls

Appeal Board panel

Jeffrey D. Billett
Jean E. Smallin
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; Guideline E DIGEST: The Judge concluded that there are no clear indications that Applicant’s financial problems are under control. He also concluded that Applicant’s false statements show a lack of judgment and an unwillingness to abide by rules and regulations. These conclusions are sustainable on this record. Adverse decision affirmed. CASE NO: 11-08546.a1 DATE: 02/27/2013 DATE: February 27, 2013 In Re: -------------------------------

Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 11-08546

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT Christopher Graham, Esq. The Department of Defense (DoD) declined to grant Applicant a security clearance. On July 23, 2012, 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)

FOOTNOTES

1 The SOR alleged false statements in the 2005 and 2011 SCAs. It did not allege false statements in the 2000 SCA. (Directive). Applicant requested a hearing. On November 29, 2012, after the hearing, Defense Office of Hearings and Appeals (DOHA) Administrative Judge Juan J. Rivera 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 was biased against Applicant; whether the Judge erred in some of his findings of fact; whether the Judge failed to consider all of the record evidence; whether the Judge erred in his application of the mitigating conditions; and whether the Judge’s whole-person analysis was erroneous. Consistent with the following, we affirm the Judge’s decision. The Judge’s Findings The Judge made the following findings pertinent to the issues raised on appeal: Applicant works for a Government contractor. He has held a security clearance since 2000. There is no evidence that he has ever compromised classified information. Applicant has three grown children, one of whom he provides with financial assistance for college. In 2000, Applicant completed a security clearance application (SCA). He did not disclose a state tax lien in this SCA, though he discussed the lien with the investigator in the subsequent clearance interview. In 2005, Applicant submitted a SCA pursuant to a periodic reinvestigation. He stated, among other things, that he had not had any liens placed against him during the previous seven years for failure to pay taxes. Applicant submitted another SCA in 2011. He denied having liens placed against him during the previous seven years for failure to pay taxes. In fact, Applicant’s state of residence had filed four tax liens against him, two in 2000 and one each in 2002 and 2008. Moreover, the IRS filed tax liens against Applicant in 2006 and 2008. Applicant owed a total of $53,000 to the IRS for tax years 2002, 2004, 2005, 2008, and 2009. Therefore, Applicant’s answers about his liens in the 2005 and 2011 SCAs were not correct.1 Applicant has satisfied his state liens, and he has established a repayment plan for the IRS liens. Applicant owes other delinquent debts. Three of the debts alleged in the SOR pertain to real estate mortgages. Applicant is making some payments on these debts, although he sometimes does so by neglecting to pay others. Applicant also became delinquent on a car loan, and he has worked out a payment plan for it. The Judge found that Applicant did not claim, and the evidence did not show, that circumstances beyond his control prevented him from paying his debts. He attributed his financial problems to overspending. The Judge’s Analysis The Judge concluded that Applicant’s financial problems raised security concerns under

2 Government Exhibit 11, Statement of Subject, dated August 30, 2000, is Applicant’s written explanation of his financial condition prepared during his 2000 clearance investigation. The statement reads in pertinent part: “The tax liens are pertaining to income taxes for [State]. Both liens are being paid through payroll deductions from my wife’s payroll account. My wife had not deducted sufficient funds from her pay for taxes. This resulted in a tax lien being initiated.” This document is not consistent with Applicant’s contention at the hearing and on appeal that he did not know what a tax lien was. Guideline F. He concluded that Applicant’s favorable evidence was not sufficient to warrant favorable application of any of the mitigating conditions. The Judge cited to the extent of Applicant’s debts and the ongoing nature of those debts, as well as to a paucity of evidence showing that (1) circumstances outside Applicant’s control affected his financial condition and (2) that Applicant took responsible action in regard to those debts. He concluded that there are no clear indications that Applicant’s financial problems are under control. The Judge noted that Applicant and his wife have been employed for several years and that Applicant presented no reasonable explanation for his current financial problems. The Judge stated that Applicant’s false answers to the SCA were deliberate, thereby raising security concerns under Guideline E. He considered Applicant’s evidence that his false answers had been due to honest mistakes but rejected that explanation as unreasonable. The Judge stated that Applicant’s 2000 clearance interview, in which he was questioned about his liens, was sufficient to place him on notice of the Government’s requirement for candor and truthfulness in the clearance process.2 The Judge also stated that Applicant’s demeanor while testifying detracted from his credibility. He concluded that Applicant’s false statements show a lack of judgment and an unwillingness to abide by rules and regulations. In the whole-person analysis, the Judge cited to evidence of Applicant’s good work record and his having possessed a clearance for many years without incident. He also cited to Applicant’s admirable personal qualities and to evidence of some debt repayment. However, the Judge stated that, because of Applicant’s extensive experience working for Federal contractors and holding a clearance, he knew or should have known about the importance of sound financial practices and of candor during a security clearance investigation. Accordingly, he concluded that Applicant was not eligible for a clearance. Discussion of Appeal Issues Applicant contends that the Judge erred in his Applicant of the mitigating conditions. He argues that Applicant had established repayment plans for his debts and that he is making satisfactory progress in meeting the requirements of those plans. Therefore, he argues that Applicant had mitigated the Guideline F security concerns. It is true that a reasonable plan for repayment can, in appropriate cases, mitigate security concerns arising from delinquent debts. See, e.g., ISCR Case No. 11-03403 at 2, note 4 (App. Bd. Aug. 23, 2012). However, a Judge must examine the entirety of an applicant’s circumstances in light of the security concern raised by them. Under Guideline F, the concern is that delinquent debts may indicate poor self-control, lack of judgment, and an unwillingness to abide by rules and regulations. Directive, Enclosure 2 ¶ 18. In the case before us, the Judge found that Applicant had

3 “[T]he Judge’s bias against Applicant is evident on the face of the decision. Failure to mitigate debts that were paid or almost paid . . . are clear evidence of bias.” Appeal Brief at 10. provided no reasonable explanation for his financial problems and that he was having to alternate payments among his creditors. A reasonable person could conclude that Applicant’s financial problems raise concerns about his judgment that such evidence of repayment as is contained in the record is not sufficient to mitigate. In any event, evidence that Applicant is neglecting to pay certain debts in order to pay others undercuts his contention that he has established a credible plan of debt resolution. For the most part, Applicant merely advances a different interpretation of the evidence, which is not enough to demonstrate that the Judge erred. See, e.g., ISCR Case No. 11-05492 at 2 (App. Bd. Dec. 19, 2012). We find no error in the Judge’s treatment of the Guideline F mitigating conditions. In addressing Guideline E, Applicant contends that the Judge erred in finding that his falsifications were deliberate. He argues that he did not know what a tax lien was and that his answers were due to an honest mistake. In analyzing an applicant’s mens rea, a Judge must consider the applicant’s answers in light of the record as a whole. See, e.g., ISCR Case No. 10-04821 at 4 (App. Bd. May 21, 2012). Evidence of Applicant’s 2000 clearance interview, which could persuade a reasonable person to believe that he understood what a tax lien was, and the Judge’s evaluation of Applicant’s demeanor, along with the other evidence in the record, support the challenged finding by the Judge. See Directive ¶ E3.1.32.1, stating that the Appeal Board gives deference to a Judge’s credibility determination. The Judge’s material findings of security concern under Guideline E are supported by substantial record evidence. See, e.g., ISCR Case No. 11-02311 at 3 (App. Bd. Nov. 26, 2012). To the extent that Applicant is challenging the Judge’s treatment of the Guideline E mitigating conditions, we resolve this issue adversely to Applicant. The Judge’s conclusion that Applicant had failed to mitigate his deliberately false statements is consistent with the record that was before him. Applicant contends that the Judge was biased against him. The only reason cited in support of this proposition was that the Judge issued an unfavorable decision.3 As stated above, however, the Judge’s application of the mitigating conditions is supportable. Applicant points to nothing in the record that would persuade a reasonable person to believe that the Judge lacked the requisite impartiality. Applicant has failed to rebut the presumption that the Judge was impartial. See, e.g., ISCR Case No. 08-03233 at 3 (App. Bd. Aug. 7, 2009)(An adverse decision, standing alone, is not sufficient to demonstrate bias). Applicant contends that the Judge erred in his whole-person analysis. Specifically, he argues that the Judge failed to discuss each of the factors set forth in Directive, Enclosure 2 ¶ 2(a)(1). A Judge is not required to discuss each of the whole-person factors, nor does a decision turn simply on finding that one or more of them apply to the facts of a particular case. A whole-person analysis requires a Judge to consider an applicant’s circumstances in light of the record evidence as a whole. See, e.g., ISCR Case No. 03-21688 at 3 (App. Bd. Jul. 2, 2007); ISCR Case No. 10-03598 at 3 (App. Bd. Oct. 10, 2012). In the case under consideration here, we find no basis to conclude that the Judge’s whole-person analysis was insufficient given the record before him. The record supports a conclusion that the Judge examined the relevant data and articulated 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 Judge’s adverse 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, Enclosure 2 ¶ 2(b): “Any doubt concerning personnel being considered for access to classified information will be resolved in favor of the national security.” Order The Decision is AFFIRMED. Signed: Jeffrey D. Billett Jeffrey D. Billett Administrative Judge Member, Appeal Board Signed: Jean E. Smallin Jean E. Smallin Administrative Judge Member, Appeal Board Signed: James E. Moody James E. Moody Administrative Judge Member, Appeal Board