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ISCR Case 17-02843.a1 — CASE

ISCR Case 17-02843.a1denied

Case Headnote

ISCR Case No. 17-02843.a1

Aug 22, 2018· Hon. Michael Y. Ra'anan· appeal

Summary

A 62-year-old male applicant, married for over 35 years, was denied a security clearance under Guideline F (Financial Considerations) due to unresolved tax issues. The disqualifying conditions cited were F.1 and F.2.

The applicant failed to file federal and state income tax returns from 2013 to 2016 and had an outstanding federal tax lien dating back to 2008. The applicant's explanations for these tax problems were not deemed sufficient, and the actions he took to resolve the issues were considered inadequate to mitigate security concerns.

Despite the applicant's claims of personal circumstances impacting his tax filings, the appeal board upheld the judge's decision. The board concluded that the applicant did not demonstrate that the judge's findings were arbitrary or contrary to law, leading to the denial of the security clearance.

Conditions Referenced

Disqualifying

F.1raisedFailure to File or Pay Taxes
F.2raisedUnresolved Tax Liens

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 issuedSep 29, 2017
Answer filed—
Hearing heldMay 25, 2018
Decision dateAug 22, 2018

Cite For

Failure to File Income Tax Returns as a Disqualifying Condition Under Guideline F
Insufficient Mitigation of Financial Issues Affecting Security Clearance
Standard for Granting Clearance 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 due to financial considerations under Guideline F. The applicant argued that the Judge's decision was arbitrary and capricious, citing personal circumstances affecting his tax filings. The Board affirmed the Judge's decision, finding no harmful error in the weighing of evidence.

Appealed bythe applicant

Applicant representationAttorney

Judge belowShari Dam — 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 contended 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 that the applicant's disagreement with the Judge's weighing of the evidence did not demonstrate harmful error. The decision was affirmed as it was consistent with national security interests.

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
Charles C. Hale
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’s appeal argues for an alternative weighing of the evidence. He contends, among other matters, that he always filed his income tax returns in a timely manner before 2013, that he was unable to file the income tax returns in question because of a marital dispute; and that he resolved a tax lien. He argues that his tax problems were infrequent and occurred under extreme circumstances that are unlikely to recur. However, an applicant’s disagreement with the Judge’s weighing of the evidence or an ability to argue for a different interpretation of the evidence is not sufficient to demonstrate the Judge weighed the evidence or reached conclusions in a manner that is arbitrary, capricious, or contrary to law. Adverse decision affirmed. CASENO: 17-02843.a1 DATE: 08/22/2018 DATE: August 22, 2018 In Re: --------------------------

Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 17-02843

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT Darryl E. Robinson, Esq. The Department of Defense (DoD) declined to grant Applicant a security clearance. On September 29, 2017, 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 May 25, 2018, after the hearing, Defense Office of Hearings and Appeals (DOHA) Administrative Judge Shari Dam 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’s adverse decision was arbitrary, capricious, or contrary to law. Consistent with the following discussion, we affirm the Judge’s decision. The Judge’s Findings of Fact Applicant, 62, has been married for over 35 years. He worked for a Federal agency for about 12 years before starting to work for a defense contractor in 2012. In security clearance applications, he disclosed that he had Federal tax liens filed against him in 2008 and 2009. In responding to interrogatories, he admitted that he did not file his Federal and state income tax returns for 2013- 2016. Applicant attributed a Federal tax lien filed against him for about $63,000 in 2005 to a failed business venture and a penalty for a 401(k) withdrawal. The lien was paid in 2009. He attributed his tax filing deficiencies to marital disagreements that started in 2013, resulted in a separation in 2014, and ended in a reconciliation in 2015. He has provided a tax preparer the pertinent information to file the tax returns. In 2008, a Federal tax lien was filed against Applicant for about $37,000. In a background interview, he stated he was making monthly payment to the IRS of $1,220 and provided proof of five monthly payments in 2017. He did not provide documentation confirming the current status of that lien. In 2009, a Federal tax lien was filed against him for about $11,300, but it was released in 2017. He and his wife earn at least $140,000 annually. He is working with a tax preparer to resolve his tax issues. The Judge’s Analysis Applicant has not filed his Federal and state income tax returns for 2013-2016 and has an outstanding Federal tax lien from 2008. He did not provide a good explanation for his tax problems. In 2017, he resolved a lien for a tax liability dating back ten years. The actions he has taken to resolve his tax problems are not sufficient to mitigate the security concerns.

DISCUSSION

Applicant’s appeal argues for an alternative weighing of the evidence. He contends, among other matters, that he always filed his income tax returns in a timely manner before 2013, that he was unable to file the income tax returns in question because of a marital dispute; and that he resolved a tax lien. He argues that his tax problems were infrequent and occurred under extreme circumstances that are unlikely to recur. However, an applicant’s disagreement with the Judge’s weighing of the evidence or an ability to argue for a different interpretation of the evidence is not sufficient to demonstrate the Judge weighed the evidence or reached conclusions in a manner that is arbitrary, capricious, or contrary to law. See, e.g., ISCR Case No. 15-00650 at 2 (App. Bd. Jun. 27, 2016). Applicant’s appeal brief fails to establish the Judge committed any harmful error. 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: Charles C. Hale Charles C. Hale Administrative Judge Member, Appeal Board Signed: James F. Duffy James F. Duffy Administrative Judge Member, Appeal Board