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ISCR Case 16-01828.a1 — CASE

ISCR Case 16-01828.a1denied

Case Headnote

ISCR Case No. 16-01828.a1

Feb 26, 2018· Hon. Michael Y. Ra'anan· appeal

Summary

A retired military member and federal contractor was denied a security clearance under Guideline F, Financial Considerations, due to significant unresolved debts. The applicant owed over $43,000 to his state and more than $11,700 to the IRS for back taxes.

Despite possessing a significant monthly income, the applicant failed to resolve these tax issues. Furthermore, the applicant did not provide evidence of responsible action regarding his debts, and his claims of financial difficulties were unsubstantiated.

The security clearance was ultimately denied because the applicant failed to demonstrate responsible financial management, specifically regarding the substantial outstanding tax obligations to both state and federal authorities.

Conditions Referenced

Disqualifying

AG ¶ 19raisedFinancial Considerations

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 issuedAug 8, 2016
Answer filed—
Hearing heldNov 14, 2017
Decision dateFeb 26, 2018

Cite For

Financial Irresponsibility Under Guideline F
Failure to Substantiate Claims of Financial Difficulties
Importance of National Security in Clearance 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 was filed by the Applicant after the Administrative Judge denied his request for a security clearance based on financial considerations. The Applicant argued that the Judge's decision was arbitrary and capricious. The Board affirmed the Judge's decision, finding it supported by substantial evidence and not contrary to law.

Appealed bythe applicant

Applicant representationPro se (self-represented)

Judge belowRobert J. Kilmartin — 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 adverse 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 was not arbitrary or capricious. The Applicant did not provide sufficient evidence to mitigate the financial concerns raised against him.

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 Ra’anan — Chair
James E. Moody
William S. Fields

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 owes over $43,000 to his state and a little over $11,700 to the IRS for back taxes. Applicant’s brief cites to matters from outside the record, which we cannot consider. Directive ¶ E3.1.29. Adverse decision affirmed. CASENO: 16-01828.a1 DATE: 02/26/2018 DATE: February 26, 2018 In Re: ---------------------------

Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 16-01828

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 August 8, 2016, 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 November 14, 2017, after the hearing, Defense Office of Hearings and Appeals (DOHA) Administrative Judge Robert J. Kilmartin 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 works for a Federal contractor in an overseas location. He served in the military until his retirement in 2009. Divorced, he remarried and has four adult children. Applicant held clearances while on active duty. Applicant owes over $43,000 to his state and a little over $11,700 to the IRS for back taxes. Applicant attributed his tax problems to overseas deployments, his employer having improperly completed his W-4, a period of unemployment from late 2013 to late 2014, and to his reliance upon his uncle to file his returns. Although the uncle had been trained as a tax preparer, Applicant described him as “reclusive, prone to panic attacks, and possibly suffering from dementia.” Decision at 3. Applicant stated that he had hired a tax lawyer to assist him in resolving his problems, but did not describe the services provided or work performed. The Judge held the record open after the hearing to enable Applicant to submit evidence about the release of tax liens and the nature of his uncle’s tax work on his behalf. However, Applicant’s submission was not responsive. Applicant’s monthly take-home pay is about $8,000 plus another $3,000 for his retirement and disability pay. After paying expenses, he has about $8,000 left over at the end of each month. He provided no evidence of financial counseling or other such assistance. Applicant has served the nation for over 30 years, including multiple overseas deployments. The Judge’s Analysis

The Judge found that Applicant’s overseas service, with its limited communication, was a condition beyond his control. However, the Judge also found that Applicant had not provided evidence of responsible action in regard to his debts. Although he had been aware of his tax problems for several years, he had not resolved them as of the close of the record. The Judge noted Applicant’s exemplary service to the U.S. but concluded that Applicant has not squarely addressed the allegations against him and has not met his burden of persuasion.

DISCUSSION

Applicant’s brief cites to matters from outside the record, which we cannot consider. Directive ¶ E3.1.29. He describes his military career and his service as a contractor, his uncle’s difficult circumstances, and his efforts at resolving his tax problems. Applicant has not rebutted the presumption that the Judge considered all of the evidence, 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. 17-00257 at 3 (App. Bd. Dec. 7, 2017). 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, Encl. 2, App. A ¶ 2(b): “Any doubt concerning personnel being considered for national security eligibility will be resolved in favor of the national security.”

ORDER

The Decision is AFFIRMED. Signed: Michael Ra’anan Michael Ra’anan Administrative Judge Chairperson, Appeal Board Signed: James E. Moody James E. Moody Administrative Judge Member, Appeal Board Signed: William S. Fields William S. Fields Administrative Judge Member, Appeal Board