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ISCR Case 15-01182.a1 — CASE

ISCR Case 15-01182.a1denied

Case Headnote

ISCR Case No. 15-01182.a1

May 3, 2017· Hon. Michael Y. Ra'anan· appeal

Summary

A defense contractor, employed since 1986, was denied a security clearance under Guideline F (Financial Considerations) due to a history of financial irresponsibility. The applicant failed to file federal income tax returns for three years and had several unresolved delinquent debts.

While the applicant did resolve some of her outstanding debts and completed a financial education course, these mitigating efforts were insufficient. The judge determined there was no direct link between the applicant's personal stressors and her failure to file tax returns. Furthermore, the applicant did not prioritize addressing her tax obligations, despite understanding their importance for her security clearance.

Ultimately, the judge found a persistent lack of responsibility regarding her tax issues, leading to the denial of her security clearance. Disqualifying conditions F.1 and F.3 were raised, and while mitigating conditions F.2, F.3, and F.4 were considered, they did not overcome the concerns regarding her tax non-compliance.

Conditions Referenced

Disqualifying

F.3raisedFailure to File Annual Income Tax Returns
F.1raisedInability or Unwillingness to Satisfy Debts

Mitigating

F.2rejectedThe Conditions That Resulted in the Financial Problems Were Largely Beyond the Person's ControlThe judge found that the applicant's personal circumstances did not excuse her failure to file tax returns.
F.3notedThe Individual Has Received Counseling for the Financial Problems
F.4appliedThe Individual Has Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant resolved some debts after receiving the SOR.

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 issuedNov 27, 2015
Answer filed—
Hearing heldFeb 6, 2017
Decision dateMay 3, 2017

Cite For

Failure to File Tax Returns as a Disqualifying Condition Under Guideline F
Importance of Personal Responsibility in Financial Matters for National Security
The Standard for Granting Security Clearances in Relation 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 to overturn a denial of a security clearance based on financial considerations. The applicant argued that the Judge failed to evaluate her case properly. The Board affirmed the Judge's decision, finding no harmful error in the evaluation of the evidence.

Appealed bythe applicant

Applicant representationAttorney

Judge belowElizabeth M. Matchinski — denied the clearance

Decided ona hearing

Guidelines belowGuideline F

What the Board reviewed

Judge mis-weighed or ignored evidence — raised by the applicantRejected
Applicant contended that the Judge did not evaluate her case in light of the record as a whole.

Why the Board ruled this way

The Board found that the Judge considered all evidence and did not weigh it in an arbitrary or capricious manner. The decision was affirmed as sustainable on the record.

Standard of review applied

Harmful-error gatekeeperSubstantial-evidence reviewArbitrary-and-capricious reviewProcedural complianceNo de-novo re-decisionDeference to the judge’s credibility calls

Appeal Board panel

Michael Y. Ra’anan — Chair
James E. Moody
William S. Fields

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 has not rebutted the presumption that the Judge considered all of the evidence in the record. Neither has she shown that the Judge weighed the evidence in a manner that was arbitrary, capricious, or contrary to law. Adverse decision affirmed. CASENO: 15-01182.a1 DATE: 05/03/2017 DATE: May 3, 2017 In Re: ----------------

Applicant for Security Clearance ) ) ) ) ) ) ) ) ISCR Case No. 15-01182

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT Ryan C. Nerney, Esq. The Department of Defense (DoD) declined to grant Applicant a security clearance. On November 27, 2015, 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 February 6, 2017, after the hearing, Defense Office of Hearings and Appeals (DOHA) Administrative Judge Elizabeth M. Matchinski denied Applicant’s request for a security clearance. Applicant appealed pursuant to Directive ¶¶ E3.1.28 and E3.1.30. Applicant raised the following issue on appeal: whether the Judge failed to evaluate Applicant’s case in light of the record as a whole. Consistent with the following, we affirm. The Judge’s Findings of Fact Applicant has been employed by a Defense contractor since 1986. She seeks to retain a clearance that was most recently granted in 2007. Applicant’s SOR lists several delinquent debts. It also alleges that she failed to file Federal income tax returns for tax years 2012 through 2014. She advised her clearance investigator that her failure to have done so was due to the demands of her job and to her lack of organization. She also experienced stressful medical problems in 2012 and 2013. After receiving the SOR, Applicant satisfied or resolved her debts. Her accountant filed her delinquent income tax returns in mid-January 2016. Applicant has completed an on-line financial education course. Her personal financial statement reports monthly discretionary income of $3,194. Her annual salary is about $138,000. Applicant enjoys an excellent reputation for integrity and for her work ethic. The Judge’s Analysis The Judge resolved Applicant’s delinquent debts in her favor. She entered adverse findings regarding Applicant’s failure to have filed her tax returns. The Judge concluded that there was no nexus between the various stressors that Applicant had experienced and her failure to file her returns. She stated that Applicant’s failure to file returns for three years suggests that Applicant was unwilling or unable to accept responsibility for her legal obligations. The Judge cited to evidence that Applicant continues to blame her problem on disorganization and exhaustion from her job, in support of the Judge’s conclusion that Applicant had failed to show responsible action. In the whole-person analysis, the Judge noted evidence of Applicant’s educational attainments, her reputation for attention to detail at work, and her having held a clearance for most of her career. However, she also stated that Applicant had been aware of the security significance of her tax problem by late 2012 yet did nothing to make resolving the issue a priority.

DISCUSSION

Applicant contends that the Judge did not evaluate her case in light of the record as a whole, citing to evidence that she believes the Judge ignored, such as her unique personal circumstances, her character references, etc. The Judge made detailed findings about these things and discussed them in her analysis. Applicant has not rebutted the presumption that the Judge considered all of the evidence in the record. Neither has she shown that the Judge weighed the evidence in a manner that was arbitrary, capricious, or contrary to law. See, e.g., ISCR Case No. 13-00502 at 3 (App. Bd. Mar. 7, 2017). The Judge complied with the requirements of the Directive in that she considered Applicant’s security concerns in light of the entirety of the evidence. See, e.g., ISCR Case No. 14- 06653 at 3 (App. Bd. Nov. 18, 2016). Applicant cites to a Hearing Office case that she believes supports her effort to retain her clearance. We give this case due consideration as persuasive authority. However, each case must be decided on its own merits, and Hearing Office cases are not binding on other Hearing Office Judges or on the Appeal Board. See, e.g., ISCR Case No. 15-01416 at 3 (App. Bd. Nov. Feb. 15, 2017). 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, Enclosure 2 ¶ 2(b): “Any doubt concerning personnel being considered for access to classified information will be resolved in favor of the national security.”

ORDER

The Decision is AFFIRMED. Signed: Michael Y. Ra’anan Michael Y. Ra’anan Administrative Judge Chairperson, Appeal Board Signed: James E. Moody James E. Moody Administrative Judge Member, Appeal Board Signed: William S. Fields William S. Fields Administrative Judge Member, Appeal Board