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ISCR Case 17-00260.a1 — CASE

ISCR Case 17-00260.a1denied

Case Headnote

ISCR Case No. 17-00260.a1

deniedApr 25, 2018· Hon. Michael Y. Ra'anan· appeal

Summary

A security clearance applicant was denied due to significant financial concerns under Guideline F. The applicant, represented by counsel, had two federal tax liens totaling approximately $106,000, covering seven tax years between 1999 and 2015. Additionally, the applicant failed to file federal income tax returns for 2009, 2010, and 2013.

The appeal board affirmed the denial, citing the applicant's failure to provide sufficient evidence to substantiate claims of tax resolution or established debt payment plans. This lack of a demonstrated track record for meeting financial obligations raised concerns about the applicant's trustworthiness and compliance, which are considered essential for national security.

The decision highlighted Disqualifying Condition AG ¶ 19, emphasizing the applicant's history of not meeting financial obligations. Ultimately, the applicant's appeal was denied, upholding the initial adverse decision.

Why the Applicant Was Denied

The applicant had two tax liens totaling about $106,000 covering seven tax years from 1999 to 2015.
The applicant failed to file Federal income tax returns for 2009, 2010, and 2013.
The applicant did not provide sufficient evidence to substantiate claims of tax resolution or debt payment plans.

Conditions Referenced

Disqualifying

AG ¶ 19raisedFinancial Considerations

Key Rule Quoted

“Failure to file tax returns and pay taxes when due suggests that an applicant has a problem with complying with well-established government rules and regulations, voluntary compliance with which is essential for protecting classified information.”
— ADP Case No. 15-00198 at 3 (App. Bd. Jan. 30, 2017)

Procedural Posture

SOR issuedJul 13, 2017
Answer filed—
Hearing held—
Decision dateApr 25, 2018

Cite For

Financial Issues Impacting Trustworthiness Under Guideline F
Failure to File Tax Returns as a Disqualifying Factor
Lack of Substantiated Claims Regarding Financial Resolution Efforts

Editorial summary generated for research. Not legal advice; not a prediction. Verify against the full decision before relying on any quoted language.

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 was subject to two tax liens totaling about $106,000. These tax liens cover seven tax years between 1999 and 2015. He owes a landlord due to a broken lease and has other delinquent accounts. In addition, Applicant failed to file Federal income tax returns for 2009, 2010, and 2013. Adverse decision affirmed. CASENO: 17-00260.a1 DATE: 04/25/2018 DATE: April 25, 2018 In Re: -------------------------

Applicant for Public Trust Position ) ) ) ) ) ) ) ) ADP Case No. 17-00260

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT Tokay T. Hackett, Esq. The Department of Defense (DoD) declined to grant Applicant a trustworthiness designation. On July 13, 2017, DoD issued a statement of reasons (SOR) advising Applicant of the basis for that decision–trustworthiness 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 January 11, 2018, after considering the record, Defense Office of Hearings and Appeals (DOHA) Administrative Judge Carol G. Ricciardello denied Applicant’s request for a trustworthiness designation. 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 and Analysis Applicant’s SOR alleges several delinquent debts. These include two tax liens totaling about $106,000, the earlier of which was subsequently released due to Applicant’s inability to pay. These tax liens cover seven tax years between 1999 and 2015. He owes a landlord due to a broken lease and has other delinquent accounts. In addition, Applicant failed to file Federal income tax returns for 2009, 2010, and 2013. Applicant stated that his “tax situation . . . got out of hand due to my frustration in dealing with the IRS.” Decision at 3, quoting Applicant’s Response to the SOR. Applicant provided a copy of a letter from a tax professional to the effect that his taxes are in a non- collectable status. He did not submit documents from the IRS regarding his tax problems. Neither did Applicant corroborate his claims to have resolved some of his debts, to have payment plans, or to have disputed at least one of the debts. In the Analysis, the Judge stated that Applicant had provided no explanation for his tax problems and that the non-collectable status of his tax debts does not relieve him of his duty to pay. She concluded that Applicant has not established a track record of debt payment. In the whole- person analysis, the Judge noted Applicant’s steady employment since 2009. She stated that even if the IRS is not actively pursuing collection, he remains liable for his delinquent taxes. Moreover, she noted that Applicant undertook debt resolution only after having received the SOR. She concluded that he had failed to mitigate the concerns raised in the SOR.

DISCUSSION

Applicant argues that the Judge’s findings are not supported by substantial evidence. However, the gist of his argument is effectively a challenge to the Judge’s weighing of the evidence. An ability to argue for a different interpretation of the evidence 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., ADP Case No. 12-09387 at 2 (App. Bd. Apr. 26, 2016). Applicant has cited to no harmful error in the Decision. The Judge’s material findings are supported by substantial evidence. See, e.g., ADP Case No. 15-03377 at 3 (App. Bd. Mar. 9, 2017). The Judge examined the relevant data and articulated a satisfactory explanation for the decision, both as to the mitigating conditions and the whole-person factors. Failure to file tax returns and pay taxes when due suggests that an applicant has a problem with complying with well- established government rules and regulations, voluntary compliance with which is essential for protecting classified information. See, e.g., ADP Case No. 15-00198 at 3 (App. Bd. Jan. 30, 2017). The standard applicable to trustworthiness cases is that set forth in Department of the Navy v. Egan, 484 U.S. 518, 528 (1988) regarding security clearances: such a determination “may be granted only when ‘clearly consistent with the interests of the national security.’” See, e.g., ADP Case No. 15- 00198, supra, at 3. See also Kaplan v. Conyers, 733 F.3d 1148 (Fed. Cir. 2013), cert. denied. In light of the above, the Judge’s adverse decision is sustainable on this record.

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