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ISCR Case 15-03411.a1 — CASE

ISCR Case 15-03411.a1denied

Case Headnote

ISCR Case No. 15-03411.a1

Feb 24, 2017· Hon. Michael Y. Ra'anan· appeal

Summary

A 45-year-old consultant for the Department of Defense was denied a security clearance due to concerns under Guideline F (Financial Considerations) and Guideline E (Personal Conduct). The applicant admitted to multiple delinquent debts totaling approximately $17,000.

While the applicant cited financial burdens from child custody litigation, the judge determined there was insufficient documentation to demonstrate the resolution of these debts. The judge concluded that the applicant's financial issues were not under control and could recur, leading to the denial.

Specifically, disqualifying condition F.3 was raised, and while mitigating conditions F.2 and F.3 were considered, they were not found sufficient to overcome the security concerns. The denial was based on the applicant's admitted delinquent debts, the lack of documented resolution, and the potential for future financial instability.

Conditions Referenced

Disqualifying

F.3raisedInability or Unwillingness to Satisfy Debts

Mitigating

F.2rejectedThe Conditions That Resulted in the Financial Problem Were Largely Beyond the Person's ControlThe applicant did not provide specifics on how her circumstances adversely affected her finances.
F.3rejectedThe Person Has Received or Is Receiving Counseling for the ProblemThe applicant did not demonstrate that she acted responsibly under the circumstances.

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 13, 2015
Answer filed—
Hearing heldDec 1, 2016
Decision dateFeb 24, 2017

Cite For

Insufficient Evidence to Mitigate Financial Concerns Under Guideline F
Impact of Unresolved Debts on Security Clearance Eligibility
The Importance of Demonstrating Responsible Financial Behavior in Clearance 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 erred in findings of fact and that the decision was arbitrary and capricious. The Board affirmed the Judge's decision, finding no harmful error that would change the outcome.

Appealed bythe applicant

Applicant representationAttorney

Judge belowMark Harvey — denied the clearance (split findings)

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.
Erroneous finding of fact — raised by the applicantError found, but harmless
Applicant claimed the Judge erred in finding that she admitted all allegations in the SOR.
Decision arbitrary, capricious, or contrary to law — raised by the applicantError found, but harmless
Applicant noted an error regarding references to 'Personal Conduct' allegations that were not present.
Judge mis-weighed or ignored evidence — raised by the applicantRejected
Applicant argued that the Judge did not weigh and consider all relevant evidence.

Error found, but harmless. The Board agreed the judge made a mistake but affirmed anyway, because it did not change the outcome.

Why the Board ruled this way

The Board found that the Judge's decision was supported by substantial evidence and that the errors claimed by the Applicant were either harmless or did not warrant a reversal of the decision.

Standard of review applied

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

Appeal Board panel

Michael Y. Ra’anan — Chair
James E. Moody
James F. Duffy

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: Guidleine F DIGEST: Applicant’s arguments are neither sufficient to rebut the presumption that the Judge considered all of the evidence in the record nor are they enough to show that the Judge weighed the evidence in a manner that was arbitrary, capricious, or contrary to law. CASE NO: 15-03411.a1 DATE: 02/24/2017 DATE: February 24, 2017 In Re: ------------

Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 15-03411

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT Ryan C. Nerney, Esq. The Department of Defense (DoD) declined to grant Applicant a security clearance. On December 13, 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 hearing. On December 1, 2016, after the hearing, Defense Office of Hearings and Appeals (DOHA) Administrative Judge Mark Harvey 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 erred in his findings of fact and 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, who is 45 years old, provides consulting services to DoD, and her annual income is about $140,000. She has never been married and has three children. She said she spent about $100,000 on child custody and support litigation over about six years. She pays about $20,000 annually for her 13-year-old child’s boarding school. She has a rental property that at times was not rented, but recently obtained a tenant resulting in a significant increase in her income. The SOR alleges 15 delinquent debts totaling about $17,000. In her response to the SOR, she admitted all of the allegations. Applicant paid three of the alleged debts (SOR ¶¶ 1.a, 1.d, and 1.l). She disputed the debt in SOR ¶ 1.o and provided documentation substantiating the dispute. SOR ¶¶ 1.g, 1.i, 1.j, 1.k, 1.m, and 1.nare medical debts . After the hearing, Applicant said she would pay these medical debts, but only provided proof of payment of one medical debt (i.e., the debt in SOR ¶ 1.d, discussed above). SOR ¶ 1.bis a telecommunication debt for which she could not recall returning the equipment to the company. SOR ¶ 1.cis a debt to a law firm that she asked to stop representing her, but the firm continued to represent and bill her. She did not file a dispute of the law firm’s debt with the credit reporting companies. SOR ¶ 1.e is a charged-off credit card debt in which the monthly minimum raised from $10 to $25 soon after she used the card, and she has refused to pay the balance. SOR ¶ 1.fis a collection account from a telecommunications company that she disputes, but did not provide any documentation showing the debt was resolved or disputed. SOR ¶ 1.his a collection account for $9,816 that arose from a contract to build a deck near her house. Applicant claims the contractor dug four holes in the wrong place near her home’s foundation that caused water issues, including the sinking of a preexisting patio. She said the cost to repair the damage would be $20,000 to $30,000. She did not provide a copy of the repair estimate. She offered to settle the debt for $2,500 and the creditor made a counter-offer for $5,000. After the hearing, she provided an $2,500 estimate for the repairs that did not discuss what steps a reasonable owner could have taken to mitigate the damage. She did not present the original plans for the deck.

The Judge’s Analysis The Judge found for Applicant on the debts she resolved (SOR ¶ 1.a, 1.d, 1.land 1.o) and against her on the remaining debts. Applicant presented important mitigating evidence, such as information about her child custody and support litigation as well as her unemployment and underemployment, but she neither provided specifics about how those circumstances over the past five years adversely affected her finances nor established that she acted responsibly under the circumstances. She may be relying on the absence of delinquent debt from her current credit report to mitigate security concerns, which is not meaningful evidence of debt resolution. While she mitigated four of the alleged debts, she did not provide sufficient documentation showing payment or other good-faith attempts to resolve the other debts. There is insufficient assurance that her financial problems are being resolved, are under control, and will not recur in the future.

DISCUSSION

In the appeal brief, Applicant states that the Judge “often misquotes or cites facts that are incorrect or backwards, indicating a confused decision that cannot be considered common sense.” A footnote at the end of that sentence refers to pages 4 and 8 of the decision. Appeal Brief at 5-6. An appealing party must state with sufficient specificity what it is about a Judge’s decision that he or she believes to be erroneous so as to enable reviewing authorities, such as the Appeal Board, to address the assignment of error. See, e.g., ISCR Case No. 14-05920 at 3 (App. Bd. Jan. 8, 2016). Applicant’s appeal brief is deficient in that regard because it failed to specify exactly what facts were misquoted or incorrect. In particular, we are unable to discern which facts on pages 4 and 8 of the decision are being challenged. We note the Judge erred in finding that Applicant admitted all of the allegations in her SOR response. She either denied or indicated that she was “unable to admit or deny” most of the SOR allegations.1 However, this error was harmless because it likely had no affect on the outcome in this case. See, e.g., ISCR Case No. 12-03420 at 3 (App. Bd. Jul. 25, 2014). In the decision, the Judge individually addressed each SOR allegation. In doing so, he noted when Applicant was disputing a particular debt and her reasons for the dispute. Consequently, the Judge was aware of Applicant’s position concerning each debt during his analysis of the evidence pertaining to that debt.

In the appeal brief, Applicant also states, “there are a number of references to ‘Personal Conduct’ allegations throughout Judge Harvey’s decision when Personal Conduct allegations were never alleged by the government.” Appeal Brief at 2-3. Our review of the decision reveals one reference to “personal conduct.” In the last paragraph of his whole-person analysis, the Judge stated, “ I conclude that personal conduct security concerns are mitigated; however, financial considerations security concerns are not mitigated.” This reference to “personal conduct” is an error because, as Applicant correctly noted, there were no personal conduct (Guideline E) allegations in the SOR. However, this error was harmless because its own wording shows it likely had no impact on the decision in this case. Id.

Applicant further argues that the Judge did not weigh and consider all relevant evidence. She cites to such things as the financial burden of her past custody disputes and her efforts to resolve her debts. However, the Judge made findings about those matters. She also claims that the Judge did not discuss many of the SOR allegations (Appeal Brief at 12). Applicant’s arguments are neither sufficient to rebut the presumption that the Judge considered all of the evidence in the record nor are they enough to show that the Judge weighed the evidence in a manner that was arbitrary, capricious, or contrary to law. See, e.g., ISCR Case No. 14-03747 at 3 (App. Bd. Nov. 13, 2015). We give due consideration to the Hearing Office case that Applicant has cited, but it is neither 1 In a post-hearing submission, Applicant changed her responses from “unable to admit or deny” concerning a number of the medical debts to admissions. See, AE P at 8-9. She continued to deny other debts. binding precedent on the Appeal Board nor sufficient to undermine the Judge’s decision. Id. Additionally, the Judge complied with the requirements of the Directive in his whole-persons analysis by considering the totality of the evidence in reaching his decision. The Judge examined the relevant evidence 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: James E. Moody James E. Moody Administrative Judge Member, Appeal Board Signed: James F. Duffy James F. Duffy Administrative Judge Member, Appeal Board