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DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS

In the matter of: ) )

) ISCR Case No. 19-00399 ) Applicant for Security Clearance )

For Government: Chris Morin, Esquire, Department Counsel For Applicant: Pro Se

07/23/2019

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METZ, John Grattan, Jr., Administrative Judge:

Based on the record in this case,1 I deny Applicant's clearance.

On 25 February 2019, the Department of Defense (DoD) sent Applicant a Statement of Reasons (SOR) raising security concerns under Guideline F, Financial Considerations.2 Applicant timely answered the SOR, requesting a decision without hearing by the Defense Office of Hearings and Appeals (DOHA). The record in this case closed 19 June 2019, when Applicant's response to the FORM was due. Applicant submitted no additional documents. DOHA assigned the case to me 9 July 2019.

Applicant admitted failing to timely file his 2015-2016 Federal income tax returns, and accumulating over $20,000 delinquent debt (SOR 1.a-1.k). He is a 41-year-old truck driver employed by a U.S. defense contractor since March 2016. He was briefly un- employed January-March 2016, but has otherwise been continually employed in similar positions since December 2005. He has never married and has no children. He has not previously held a clearance (Item 3).

Applicant disclosed SOR debts 1.a and 1.i on his March 2016 clearance application (Item 2). Applicant discussed his failures to file, and all the SOR debts except SOR 1.c, during his August 2018 interview with a Government investigator (Item 4), based on his April 2016 credit report (Item 5). He attributed his failure to timely file his Federal income tax returns for the years at issue to being lazy. He stated his intent to file his delinquent tax returns in April 2019, along with his 2018 income tax return. He also described the nine delinquent debts on his April 2016 credit report and stated his intent to investigate the current status of the debts and make arrangements to resolve them. However, he has neither claimed nor documented any actions taken.

Applicant's Answer (Item 2) admitted the SOR allegations, but did not otherwise illuminate his financial situation. Applicant documented no credit or financial counseling, and did not submit a budget. He provided no work or character references, or evidence of community involvement.

The adjudicative guidelines (AG) list factors for evaluating a person's suitability for access to classified information. Administrative judges must assess disqualifying and mitigating conditions under each issue fairly raised by the facts and situation presented. Each decision must also reflect a fair, impartial, and commonsense consideration of the factors listed in AG ¶ 2(a). Any one disqualifying or mitigating condition is not, by itself, conclusive. However, specific adjudicative guidelines should be followed where a case can be measured against them, as they represent policy guidance governing access to classified information. Considering the SOR allegations and the evidence as a whole, the relevant adjudicative guideline is Guideline F (Financial Considerations).

Security clearance decisions resolve whether it is clearly consistent with the national interest to grant or continue an applicant's security clearance. The Government must prove, by substantial evidence, controverted facts alleged in the SOR. If it does the burden shifts to applicant to refute, extenuate, or mitigate the Government's case. Because no one has a right to a security clearance, the applicant bears a heavy burden of persuasion.

Persons with access to classified information enter into a fiduciary relationship with the Government based on trust and confidence. Therefore, the Government has a

compelling interest in ensuring each applicant possesses the requisite judgement, reliability, and trustworthiness of those who must protect national interests as their own. The Aclearly consistent with the national interest@ standard compels resolution of any reasonable doubt about an applicant's eligibility for access in favor of the Government.3

The Government established a case for disqualification under Guideline F, and Applicant failed to mitigate the security concerns. Applicant failed to timely file his 2015- 2016 Federal income tax returns. He has stated no credible reason for his failures, and his admitted laziness sheds no favorable light on his failure to timely file his tax returns. He documented no efforts to address his $20,000 delinquent debt.4

The Appeal Board has long held that failure to timely file required tax returns may demonstrate a lack of judgment inconsistent with access to classified information.

A person who fails repeatedly to fulfill his or her legal obligations does not demonstrate the high degree of good judgment and reliability required of persons granted access to classified information. Indeed, the Board has previously noted that a person who has a history of not fulfilling their legal obligation to file income tax returns may be said not to have demonstrated the high degree of judgment and reliability required for access to classified information.@5

This is true whether the failure to file is6 or attributed to the press of other circumstances.7 As recently as December 2015, the Appeal Board upheld a denial of clearance, in a case notably similar to this, of an applicant who had failed to file Federal or state income tax returns for 10 years.

The filing of tax returns is both a financial and a legal obligation. Applicant's . . . failure to have done so for many years is sufficient to raise a concern that he may be unwilling to follow other rules and regulations, such as those that apply

to the handling of classified information. See, e.g., ISCR Case No. 14-01894 at 5 (App. Bd. Aug. 18, 2015) (A person who fails repeatedly to fulfill his or her legal obligations does not demonstrate the high degree of good judgment and reliability required of those granted access to classified information). See also Cafeteria & Restaurant Workers Union Local 473 v. McElroy, 284 F.2d 173, 183 (D.C. Cir. 1960), aff'd, 367 U.S. 886 (1961). Indeed, as the Judge noted, Directive, Enclosure 2 & 19(g) explicitly provides that failure to file tax returns is a circumstance that can raise a security concern. Moreover, the Directive presumes a nexus between admitted or proven conduct under any of the Guidelines and an applicant's eligibility for a clearance. See. e.g., ISCR Case No. 14-04648 at 3 (App. Bd. Sep. 9, 2015). ISCR Case No. 14-02930 at 3 (App. Bd. Dec. 9, 2015). Security concerns under Guideline F are not limited to cases in which an Applicant is financially insolvent or is experiencing difficulty in paying debts. In this case his failure to timely file his Federal returns for two years leaves potentially unresolved tax debt, along with the consumer debt. Applicant meets none of the mitigating conditions for financial considerations. His indebtedness and his failures to timely file his Federal returns are multiple, recent, and the circumstances are not demonstrated to be unlikely to recur.8 Moreover, he has not demonstrated that his indebtedness and failures to timely file were due to circumstances beyond his control, and it is clear that he has not been responsible in addressing his debts or his taxes.9 Applicant has not had any credit or financial counseling, and he has not documented that the debts are being resolved.10 The lack of documentation means he cannot demonstrate that he has made a good-faith effort to resolve his debts.11 The missing details of his current tax status requires the same conclusion regarding his taxes.12 Moreover, he submitted no work or character evidence which might 8&20(a) the behavior happened so long ago, was so infrequent, or occurred under such circumstances that it is unlikely to recur . . . 9&20(b) the conditions that resulted in the financial problem were largely beyond the person's control . . . and the individual acted responsibly under the circumstances; 10&20(c) the person has received or is receiving counseling for the problem and there are clear indications that the problem is being resolved or is under control; 11&20(d) the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts. 12&20(g) the individual has made arrangements with the appropriate to file or pay the amount owed and is in compliance with those arrangements: support a whole-person assessment to overcome the security concerns raised by his conduct. I conclude Guideline F against Applicant. Findings Formal Paragraph 1. Guideline F: AGAINST APPLICANT Subparagraphs a-k Against Applicant

Under the circumstances presented by the record in this case, it is not clearly consistent with the national interest to grant or continue a security clearance for Applicant. Clearance denied. ----------------------------------------- JOHN GRATTAN METZ, JR Administrative Judge

1 Consisting of the File of Relevant Material (FORM), Items 1-7.

2 DoD acted under Executive Order 10865, Safeguarding Classified Information Within Industry (February 20, 1960), as amended; DoD Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and Security Executive Agent Directive 4, effective 8 June 2017.

3 See, Department of the Navy v. Egan, 484 U.S. 518 (1988). 4&19(a) inability to satisfy debts; (b) unwillingness to satisfy debts regardless of the ability to do so;(c) a history of not meeting financial obligations; (f) failure to file or fraudulently filing annual Federal, state, or local income tax returns of failure to pay annual Federal, state, or local income tax as required;

5 ISCR Case No. 12-05053 at 4 (App. Bd. Oct. 30, 2014), reversing Administrative Judge's favorable decision. See, e.g., ISCR Case No. 98-0608 at 2 (App. Bd. Jun. 27, 2000)(failure to file for five years).

6 See, ISCR Case No. 98-0801 (App. Bd. Jun. 8, 2000)(tax protester)

7 See, ISCR Case No. 98-0761 (App. Bd. Dec. 27, 1999)(routine failure to file).