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ISCR 08-03110.a1: Guideline E security clearance appeal, denied (2009) · CASE

ISCR Case 08-03110.a1denied

Case headnote

ISCR Case No. 08-03110.a1

Jan 27, 2009· Hon. Michael D. Hipple· appeal

Summary

A software developer and consultant was denied a security clearance due to concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The denial stemmed from over $18,000 in delinquent debts and false statements made on his security clearance application regarding these debts and tax liens.

The judge determined that the applicant had not made reasonable efforts to satisfy his creditors, despite having a monthly income exceeding $3,000 after expenses. This failure, combined with the false statements, raised significant doubts about his trustworthiness and reliability.

The appeal board affirmed the denial, underscoring the critical importance of honesty and financial responsibility for individuals holding national security positions. Disqualifying conditions AG ¶ 20 and AG ¶ 15 were raised, while mitigating conditions AG ¶ 21 and AG ¶ 17 were considered but ultimately did not overcome the security concerns.

Conditions referenced

Disqualifying

AG ¶ 20raisedFinancial Considerations
AG ¶ 15raisedPersonal Conduct

Mitigating

AG ¶ 21rejectedFinancial ConsiderationsApplicant did not demonstrate reasonable efforts to resolve his debts.
AG ¶ 17rejectedPersonal ConductApplicant's false statements undermined his credibility.

Key rule quoted

“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 issuedJun 18, 2008
Answer filed—
Hearing heldOct 31, 2008
Decision dateJan 27, 2009

Cite for

Denial Based on Significant Financial Issues Under Guideline F
False Statements on Security Clearance Applications Under Guideline E
Importance of Trustworthiness in National Security Matters

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 and personal conduct. The applicant argued that the Judge erred in applying mitigating conditions and conducting a whole-person analysis, and claimed due process violations due to self-representation. The Board affirmed the Judge's decision, finding no harmful errors in the proceedings.

Appealed bythe applicant

Applicant representationAttorney

Judge belowMary E. Henry denied the clearance

Decided ona hearing

Guidelines belowGuideline FGuideline E

What the Board reviewed

Decision arbitrary, capricious, or contrary to law, raised by the applicantRejected
Applicant claimed the Judge's application of the Guideline F and E Mitigating Conditions was erroneous.
Decision arbitrary, capricious, or contrary to law, raised by the applicantRejected
Applicant argued that the Judge's whole-person analysis was erroneous.
Due-process / fairness, raised by the applicantRejected
Applicant asserted that he was denied due process rights due to self-representation.

Why the Board ruled this way

The Board found no error in the Judge's application of the mitigating conditions and whole-person analysis, and determined that the applicant was adequately informed of his rights during the proceedings.

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 D. Hipple
William S. Fields
James E. Moody

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; Guideline E DIGEST: Applicant’s claim that his due process rights were compromised by his self- representation is belied by the record, which establishes he received detailed pre-hearing guidance from DOHA explaining his rights. The fact that Applicant had over $3,000 in income each month after expenses supported the Judge’s conclusion that Applicant had not made reasonable efforts to satisfy his creditors. Adverse decision affirmed. CASENO: 08-03110.a1 DATE: 01/27/2009 DATE: January 27, 2009 In Re: ---------------------------- Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 08-03110

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT George W. Gekas, Esq. The Defense Office of Hearings and Appeals (DOHA) declined to grant Applicant a security clearance. On June 18, 2008, DOHA issued a statement of reasons (SOR) advising Applicant of the basis for that decision–security concerns raised under Guideline F (Financial Considerations) and Guideline E (Personal Conduct) of Department of Defense Directive 5220.6 (Jan. 2, 1992, as amended) (Directive). Applicant requested a hearing. On October 31, 2008, after the hearing, Administrative Judge Mary E. Henry denied Applicant’s request for a security clearance. Applicant filed a timely appeal pursuant to Directive ¶¶ E3.1.28 and E3.1.30. Applicant raised the following issues on appeal: whether the Judge’s application of the Guideline F and E Mitigating Conditions was erroneous; whether the Judge’s whole-person analysis was erroneous; and whether Applicant was denied the due process rights secured him by the Directive. Finding no error, we affirm. The Judge made the following pertinent findings of fact: Applicant is a software developer and consultant for a Department of Defense contractor. After graduating from college in 1980 he worked for a state government, retiring from that job in 1993. Following retirement he set up his own business related to information technology. When he expanded his business activities, it did not generate enough revenue to pay operating expenses, in light of changes in the market. He used his personal income to pay employees, with a result that he was not able to pay his personal bills. His business ultimately failed. Applicant experienced financial troubles as well as tax problems. He and his wife divorced. They sold their house to pay off debts. Proceeds from this sale paid off Applicant’s tax liens. He now lives with his parents to save money. His income is such that he nets $3,584 a month after expenses. Applicant has numerous delinquent debts for credit cards, etc. The total amounts owed on those debts for which the Judge found against Applicant exceed $18,000. Additionally, Applicant answered “no” on questions on his security clearance application which inquired about debts over 180 days delinquent and about any tax liens against him. These answers were not true. The Board has considered the issues which Applicant has raised on appeal. Concerning Applicant’s claim that his due process rights were compromised by his self-representation, the record demonstrates that Applicant received detailed pre-hearing guidance from DOHA explaining his rights. Among other things, he was advised of his right to employ counsel, or to have some other person represent him at the hearing; his right to present evidence and witnesses; his right to cross- examine witnesses against him; and his right to object to evidence. A review of the entire record discloses no basis to conclude that Applicant was denied the rights due him under the Directive or that he had not been adequately advised of those rights. See Tr. at 4-8. “Having decided to represent himself during the proceedings below, Applicant cannot fairly complain about the quality of his self- representation or seek to be relieved of the consequences of his decision to represent himself.” ISCR Case No. 02-08032 at 4 (App. Bd. May 14, 2004). The record demonstrates that the Judge considered appropriate mitigating conditions, holding in favor of Applicant as to several of the Guideline F and Guideline E allegations. However, she concluded that Applicant had failed to meet his burden of persuasion as to the remaining allegations. See Directive ¶ E3.1.15. She paid attention to the fact that Applicant had over $3,000 in income each month after expenses yet had not made reasonable efforts to satisfy his creditors. Viewed in See, e.g., Decision at 9: “Applicant has not acted with due diligence to resolve his remaining outstanding debts, despite availability of almost $3,000 a month after his expenses are paid. Applicant’s failure to honestly answer questions about his finances raises questions about his trustworthiness. He has not demonstrated a rational reason for his decision to answer ‘no’ to two financial questions on his security clearance application. His failure at his hearing to candidly explain why he provided a false SF-86 remains a security concern.” light of the record as a whole, the Judge’s adverse conclusion concerning mitigation is sustainable. The Judge’s whole-person analysis is also sustainable. See ISCR Case No. 03-22861 at 2-3 (App. Bd. Jun. 2, 2006). See also Motor Vehicle Mfrs. Ass’n of the United States v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)(quoting Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168 (1962)) “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). Accordingly, the Judge’s decision is neither arbitrary, capricious, nor contrary to law

ORDER

The Judge’s adverse security clearance decision is AFFIRMED. Signed: Michael D. Hipple

Michael D. Hipple Administrative Judge Member, Appeal Board Signed: William S. Fields William S. Fields Administrative Judge Member, Appeal Board Signed: James E. Moody James E. Moody Administrative Judge Member, Appeal Board