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ISCR Case 16-03704.a2 — CASE

ISCR Case 16-03704.a2denied

Case Headnote

ISCR Case No. 16-03704.a2

Aug 23, 2018· Hon. Michael Y. Ra'anan· appeal

Summary

An applicant, represented by counsel, was denied a security clearance under Guideline F (Financial Considerations) due to unresolved delinquent debts. The appeal board affirmed this denial, citing the applicant's failure to provide sufficient evidence of debt resolution, which raised concerns about their reliability and trustworthiness.

Specifically, the applicant did not provide corroborating documentation, such as tax returns or Form 1099-Cs, to substantiate claims of debt resolution. The judge determined that a charged-off debt does not equate to forgiveness of liability, thereby undermining the applicant's assertions.

Furthermore, the applicant's reliance on the statute of limitations was deemed insufficient to mitigate the concerns associated with the delinquent debts. The denial was based on Disqualifying Condition AG ¶ 20(a).

Conditions Referenced

Disqualifying

AG ¶ 20(a)raisedFinancial Considerations

Key Rule Quoted

“A charged-off debt is not equivalent to one that the creditor has forgiven.”
— ISCR Case No. 10-01188 at 2 (App. Bd. Jun. 15, 2011)

Procedural Posture

SOR issuedDec 29, 2016
Answer filed—
Hearing heldDec 14, 2017
Decision dateAug 23, 2018Decision on Remand

Cite For

Affirmation of Denial Based on Unresolved Delinquent Debts Under Guideline F
Insufficient Evidence of Debt Resolution Impacting Reliability and Trustworthiness
Clarification That Charged-off Debts Do Not Equate to Forgiveness of Liability

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, but the Board affirmed the decision, finding no harmful error in the Judge's weighing of the evidence.

Appealed bythe applicant

Applicant representationAttorney

Judge belowMark Harvey — 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 contends 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 articulated a satisfactory explanation for the adverse conclusions regarding the applicant's financial considerations.

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 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: Guideline F DIGEST: Applicant contends that the record, viewed as a whole, shows that he has attempted to resolve the delinquent debts that the Judge found against him. However, Applicant’s brief amounts to a disagreement with the Judge’s weighing of the evidence, which is not enough to show that the Judge weighed the evidence in a manner that was arbitrary, capricious, or contrary to law. Adverse decision affirmed CASENO: 16-03704.a2 DATE: 08/23/2018 DATE: August 23, 2018 In Re: ---------------------

Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 16-03704

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT James F. Jacobson, Esq. The Department of Defense (DoD) declined to grant Applicant a security clearance. On December 29, 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 December 14, 2017, 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. On March 19, 2018, we remanded the case to the Judge to consider evidence that did not make it into the record. On May 7, 2018, the Judge issued an adverse Decision on Remand, Applicant appealed pursuant to the Directive. Applicant raises 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 and Analysis The SOR listed numerous delinquent debts. The Judge entered favorable findings regarding all but two of them, a charged-off credit card debt for nearly $19,000 and a charged-off department store account for over $2,000. Applicant claimed that he had paid taxes due when the creditor released him from further liability. However, he did not submit corroborating evidence, such as Form 1099-Cs or tax returns showing payment of taxes. Applicant’s counsel sent a letter to the creditors, requesting the issuance of a 1099-C.1 Counsel also stated to the Judge that the evidence, viewed as a whole, shows that these debts have been resolved. The Judge noted Applicant’s reliance on the statute of limitations concerning the two debts listed above, which in and of itself is not sufficient to mitigate concerns arising from delinquent debts. The Judge observed that Applicant had not provided proof of payment, correspondence with the creditors, evidence of attempts to negotiate a settlement, or other efforts at debt resolution. In the whole-person analysis, the Judge concluded that Applicant’s failure to address these two debts impugn his reliability and trustworthiness.

DISCUSSION

Applicant contends that the Judge did not properly weigh the evidence that he submitted. He contends that the record, viewed as a whole, shows that he has attempted to resolve the delinquent debts that the Judge found against him. However, Applicant’s brief amounts to a disagreement with the Judge’s weighing of the evidence, which is not 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. 17-01181 at 4 (App. Bd. Apr. 30, 2018). Moreover, a charged-off debt is not equivalent to one that the creditor has forgiven, as Applicant appeared to urge in his case in mitigation. See, e.g., ISCR Case No. 10-01188 at 2 (App. Bd. Jun. 15, 2011). See also Dacumos v. Toyota Motor Credit Corp., 287 F.Supp. 3d 1152 at 1157 (W.D. WA 2017) (“[A] charge off does not extinguish liability for the debt”) (citing Plaza Bank v Green Family Trust, 2011 U.S. Dist. LEXIS 141044, *15-16, WL 6102883, at *5 (D. Nev. Dec. 7, 2011)). We find no reason to disturb the Judge’s overall adverse conclusions. 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: James F. Duffy James F. Duffy Administrative Judge Member, Appeal Board

FOOTNOTES

1 “It is my client’s understanding that such debt was previously charged off by your entity. We are requesting that you forward us a 1099-C tax form in accordance with that understanding.” Decision on Remand at 4, quoting from Applicant Exhibit U, Letter from Counsel to Creditor dated April 16, 2018, which was issued after the case was remanded.