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ISCR Case 15-03875.a1 — CASE

ISCR Case 15-03875.a1denied

Case Headnote

ISCR Case No. 15-03875.a1

Oct 26, 2016· Hon. Michael Y. Ra'anan· appeal

Summary

A defense contractor, employed since 2003, was denied a security clearance under Guideline F (Financial Considerations) due to unresolved financial issues. Specifically, the applicant's appeal was denied because he failed to provide sufficient evidence to mitigate concerns about his overall financial condition, which included problems related to co-signed loans.

The applicant's generalized statements of financial struggle were deemed inadequate. Disqualifying condition F.3 was raised, indicating a history of not meeting financial obligations. The applicant's financial problems were not resolved, as evidenced by ongoing litigation and new debts.

Despite claims of financial stability and timely payments on some debts, the applicant did not present enough evidence to overcome the concerns. Consequently, the security clearance was denied.

Conditions Referenced

Disqualifying

F.3raisedInability or Unwillingness to Satisfy Debts

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 issuedDec 3, 2015
Answer filed—Applicant requested a decision on the written record.
Hearing heldAug 3, 2016
Decision dateOct 26, 2016Appeal affirmed.

Cite For

Insufficient Evidence to Mitigate Financial Concerns Under Guideline F
Importance of Providing Detailed Financial Information
General Standard for Granting Security Clearances Related to National Security Interests

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 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 in the analysis or conclusions reached.

Appealed bythe applicant

Applicant representationPro se (self-represented)

Judge belowElizabeth M. Matchinski — denied the clearance

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 decision was arbitrary, capricious, or contrary to law.

Why the Board ruled this way

The Board found that the Judge considered all evidence and did not weigh it in an arbitrary or capricious manner. The decision was supported by substantial evidence and articulated a satisfactory explanation for the denial of the security clearance.

Standard of review applied

Harmful-error gatekeeperSubstantial-evidence reviewArbitrary-and-capricious reviewNo de-novo re-decisionNo new evidence on appeal

Appeal Board panel

Michael Y. Ra’anan — Chair
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 DIGEST: Applicant has not rebutted the presumption that the Judge considered all of the evidence in the record, nor has he shown that the Judge weighed the evidence in a manner that was arbitrary, capricious, or contrary to law. Adverse decision affirmed. CASENO: 15-03875.a1 DATE: 10/26/2016 DATE: October 26, 2016 In Re: -------

Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 15-03875

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 December 3, 2015, 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 August 3, 2016, after considering the record, Defense Office of Hearings and Appeals (DOHA) Administrative Judge Elizabeth M. Matchinski denied Applicant’s request for a security clearance. Applicant appealed pursuant to Directive ¶¶ E3.1.28 and E3.1.30. Applicant raised the following issue on appeal: whether the Judge’s adverse decision was arbitrary, capricious, or contrary to law. Consistent with the following, we affirm. The Judge’s Findings of Fact Applicant has worked for a Defense contractor since 2003. This is his first effort to obtain a clearance. Applicant financed his education with student loans, which he has paid on time. However, he co-signed two student loans for his spouse and became jointly liable with her on a third. These loans form the basis of the three SOR allegations at issue here. The couple experienced some difficult circumstances that had an impact on their finances. Applicant’s spouse received reduced pay from her job while on maternity leave, and they began to struggle with their monthly expenses. Applicant’s spouse was unemployed for two months. She took another job at less pay but has been fully employed since early 2013. The creditors charged-off the loans alleged in the SOR. Applicant and his spouse made monthly payments for one of them, the largest, and initiated court challenges to the other two based on lack of privity of contract and/or the statute of limitations. The record contains no evidence about Applicant’s income, expenses, or personal family circumstances that affected their financial condition. There is no evidence that Applicant addressed the two loans that were the subject of litigation during the pendency of the disputes. In addition, the couple took on new debt by obtaining car loans and by financing the purchase of furniture. The two loans that were the subject of litigation were acquired by a collection agency, which offered a settlement agreement that the couple could not afford. In early 2016, the couple set up automatic payments of $75 on each of these two loans, that being all that they could pay. Applicant’s other loans and his ordinary expenses are being paid on time. The Judge’s Analysis The Judge stated that Applicant had provided little specific information about the circumstances that led up to their debts, except that his wife suffered a diminution in income and that a follow-on job entailed less pay. She stated that Applicant had provided no information about the extent of the income loss or of other difficult circumstances. She stated that generalized statements of financial struggle were not enough fully to mitigate the concerns arising from Applicant’s financial problems. The Judge made favorable findings about the one student loan that had been the subject of consistent payments. However, she stated that, without information about Applicant’s income, savings, and expenses, it was not possible to determine whether the amounts he was paying on the other two were enough to mitigate the concerns arising from them. She concluded that the record contained insufficient evidence that Applicant’s problems were resolved.

DISCUSSION

Applicant cites to evidence concerning his effort at debt resolution and argues that his credit reports show that he is in good financial condition. Relying on a statement that he had submitted in response to the File of Relevant Material, Applicant’s brief provides context for his debt situation. He contends that he is able to pay his current bills and that he has acquired no additional delinquencies. Applicant has not rebutted the presumption that the Judge considered all of the evidence in the record, nor has he shown that the Judge weighed the evidence in a manner that was arbitrary, capricious, or contrary to law. See, e.g., ISCR Case No. 14-05795 at 2-3 (App. Bd. Apr. 26, 2016).

The Judge examined the relevant data and articulated a satisfactory explanation for the decision. The 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: Michael Y. Ra’anan Michael Y. Ra’anan Administrative Judge Chairperson, 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