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ISCR Case 16-02415.h1 — CASE

ISCR Case 16-02415.h1granted

Case Headnote

ISCR Case No. 16-02415.h1

grantedMay 8, 2017· Hon. Edward W. Loughran· hearing

Summary

A 45-year-old U.S. citizen engineer, originally from Hong Kong, was granted a security clearance despite concerns under Guidelines B (Foreign Influence) and C (Foreign Preference). The Statement of Reasons highlighted that his father and sister are U.S. citizens residing in Hong Kong, while his stepmother is a Chinese citizen also living there. These family ties, coupled with the authoritarian nature of the Chinese government and its espionage activities against the U.S., raised concerns about potential conflicts of interest and foreign exploitation.

Further allegations noted that the applicant was born in Hong Kong as a British citizen and lived there until immigrating to the U.S. at age 12. He became a U.S. citizen in 1990, along with his parents and siblings. Disqualifying conditions were raised regarding the exercise or acquisition of foreign citizenship.

However, the judge applied several mitigating conditions. The applicant demonstrated deep and longstanding relationships and loyalties within the United States, credibly affirming his allegiance to the U.S. and his commitment to report any coercion attempts. Additionally, his foreign identification cards were destroyed, effectively mitigating foreign preference concerns. Based on these factors, the security clearance was granted.

Why the Applicant Prevailed

The applicant has deep and longstanding relationships and loyalties in the United States.
The applicant credibly stated his allegiance lies with the United States and would report any coercion attempts.
The applicant's foreign identification cards were destroyed, mitigating foreign preference concerns.

Conditions Referenced

Disqualifying

AG ¶ 7(a)raisedContact with Foreign Family Members
AG ¶ 7(b)raisedConnections to Foreign Persons

Mitigating

AG ¶ 8(a)appliedNature of Relationships with Foreign Persons
AG ¶ 8(b)appliedMinimal Loyalty to Foreign Persons
AG ¶ 11(e)appliedDestruction of Foreign Passport

Key Rule Quoted

“The protection of the national security is the paramount consideration.”

Procedural Posture

SOR issuedAug 28, 2016
Answer filedSep 8, 2016
Hearing heldFeb 21, 2017
Decision dateMay 8, 2017

Cite For

Mitigation of Foreign Influence Concerns Due to Strong U.S. Ties
Mitigation of Foreign Preference Concerns Through Destruction of Foreign Identification
Consideration of the Whole-person Concept in Security Clearance Decisions.

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

Standardized Decision Profile

SEAD-4 Guideline B (Foreign Influence) · descriptive summary of a decided case

Posture: Decision on RecordDecided: granted

The judge found that the applicant mitigated the foreign influence concerns related to his family ties in Hong Kong and China. The applicant's connections were deemed unlikely to create a conflict of interest, and he demonstrated strong ties to the United States, leading to a favorable decision for security clearance.

Country conditions:the decision took administrative notice of official facts about the foreign country (the Government’s country submission).

U.S. ties the decision noted: Naturalized U.S. Citizen · U.S. Home or Property · U.S. Career or Business · Intent to Remain in U.S.

¶	Allegation	Finding	Relationship	Country	Response	Disqualifying (¶7)	Mitigating applied (¶8)	Mitigation
2.a	Applicant’s father and sister are U.S. citizens living in Hong Kong. His stepmother is a Chinese citizen living in Hong Kong. The PRC has an authoritarian government, dominated by the Communist Party, with a poor human rights record, and targets the U.S. for espionage. Applicant’s contacts in Hong Kong create a potential conflict of interest and a heightened risk of foreign exploitation, inducement, manipulation, pressure, and coercion.	For Applicant	Parent in Foreign Country Immediate Family GOVT-AFFILIATED	Hong Kong HEIGHTENED RISK	Unknown	(a) contact with a foreign family member/associate/friend creating a heightened risk of exploitation (b) connections creating a potential conflict of interest	(a) relationships such that a conflict between foreign and U.S. interests is unlikely (b) deep/longstanding U.S. loyalties; conflict resolves in favor of the U.S.	—
2.b	Applicant was born in Hong Kong when it was a British territory. He lived in Hong Kong as a British citizen until he immigrated to the United States with his parents and two siblings when he was about 12 years old. He attended middle school, high school, and college in the United States. He became a U.S. citizen in 1990, when he was 18 years old. His parents and siblings also became U.S. citizens at the same time.	For Applicant	Sibling in Foreign Country Immediate Family	Hong Kong HEIGHTENED RISK	Unknown	(a) contact with a foreign family member/associate/friend creating a heightened risk of exploitation (b) connections creating a potential conflict of interest	(a) relationships such that a conflict between foreign and U.S. interests is unlikely (b) deep/longstanding U.S. loyalties; conflict resolves in favor of the U.S.	—

Descriptive standardized rendering of a decided public case (Guideline B). The verbatim source decision is shown in full below.

Standardized Decision Profile

SEAD-4 Guideline C (Foreign Preference) · descriptive summary of a decided case

Posture: Decision on RecordDecided: granted

The judge found that the applicant mitigated the foreign preference security concerns. The applicant had previously held foreign identification cards but took steps to destroy them, demonstrating allegiance to the United States. The judge ruled in favor of the applicant on all allegations under Guideline C.

¶	Allegation	Finding	Type	Response	Disqualifying (¶10)	Mitigating applied (¶11)	Mitigation
1.a	exercise of any right, privilege or obligation of foreign citizenship after becoming a U.S. citizen or through the foreign citizenship of a family member. This includes but is not limited to: possession of a current foreign passport;	For Applicant	Foreign Citizenship Acquisition or Application	Unknown	—	(e) the exercise of the entitlements or benefits of foreign citizenship do not present a national security concern	Claimed Other
1.b	action to acquire or obtain recognition of a foreign citizenship by an American citizen.	For Applicant	Foreign Citizenship Acquisition or Application	Unknown	—	—	Claimed Other

Descriptive standardized rendering of a decided public case (Guideline C). The verbatim source decision is shown in full below.

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

HEARING

APPEARANCES

DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS

In the matter of: ) ) ) ISCR Case No. 16-02415 ) Applicant for Security Clearance )

For Government: John Bayard Glendon, Esq., Deputy Chief Department Counsel Gatha Manns, Esq., Department Counsel For Applicant: William F. Savarino, Esq.

05/08/2017 ______________

STATEMENT OF CASE

______________

LOUGHRAN, Edward W., Administrative Judge:

Applicant mitigated the foreign influence and foreign preference security concerns. Eligibility for access to classified information is granted.

Statement of the Case

On August 28, 2016, the Department of Defense (DOD) issued a Statement of Reasons (SOR) to Applicant detailing security concerns under Guidelines B (foreign influence) and C (foreign preference). The action was taken under Executive Order (EO) 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 the adjudicative guidelines (AG) implemented by the DOD on September 1, 2006.

Applicant responded to the SOR on September 8, 2016, and requested a hearing before an administrative judge. The case was assigned to me on February 6, 2017. After coordinating with the parties, the Defense Office of Hearings and Appeals (DOHA) issued a notice of hearing on February 7, 2017, scheduling the hearing for February 21, 2017. The hearing was convened as scheduled. DOHA received the hearing transcript (Tr.) on February 28, 2017.

Procedural and Evidentiary Rulings

Evidence

Government Exhibits (GE) 1 and 2 were admitted in evidence without objection. Applicant testified and submitted Applicant’s Exhibits (AE) A through D, which were admitted without objection. The record was held open for Applicant to submit additional information. He submitted a letter that was marked AE E and admitted without objection.

Request for Administrative Notice

Department Counsel requested that I take administrative notice of certain facts about the People’s Republic of China (PRC) and the Hong Kong Special Administrative Region. The request was not admitted in evidence but was included in the record as Hearing Exhibit (HE) I. Applicant did not object, and I have taken administrative notice of the facts contained in HE I. I have also considered the facts contained in AE C and D. The most pertinent facts are summarized in the Findings of Fact, below.

FINDINGS OF FACT

Applicant is a 45-year-old engineer employed by a defense contractor. He has worked for his current employer since 2008. He first received a security clearance in about 1999, but it lapsed after a few years when his employer lost a contract. He is reapplying for a security clearance. He has a bachelor’s degree. He has never married, and he has no children.1

Applicant was born in Hong Kong when it was a British territory. He lived in Hong Kong as a British citizen until he immigrated to the United States with his parents and two siblings when he was about 12 years old. He attended middle school, high school, and college in the United States. He became a U.S. citizen in 1990, when he was 18 years old. His parents and siblings also became U.S. citizens at the same time.2

Applicant’s mother is deceased. Applicant’s father maintained a business in Hong Kong after he relocated to the United States. He continued to spend a lot of time in Hong Kong and relocated there permanently with Applicant’s mother in the mid- 1990s. Applicant’s mother passed away more than ten years ago. His father married a woman who was born in China. They live together in Hong Kong. He is retired and lives off his savings. Applicant does not believe that his stepmother is employed. Applicant communicates with his father by telephone about every three months. He has limited communication with his stepmother, and he knows little about her family.3

Applicant’s brother works in the United States for a U.S. corporation. Applicant’s sister is married to a citizen of a country in the British Commonwealth. They live in Hong Kong. Her husband is an executive in an industry that is not directly connected to the Hong Kong government, but may have some affiliation with it. Applicant’s sister takes care of their children and is not employed outside the home. Applicant communicates with his sister about every two to three months.4

Applicant does not intend to go to Hong Kong or China to live. He likes living in the United States and considers it home. He does not have any foreign assets. He owns a condominium and other assets in the United States. His net worth is greater than $300,000. He went to Hong Kong more than ten years ago for his mother’s funeral and did not return until 2013, when he visited his father who had an operation. He visited his father and sister in 2015. He has not visited China since he was a child.5

All of Applicant’s travels since he became a U.S. citizen have been on his U.S. passport. When he was a child, his parents obtained for him a travel card issued by the Chinese government that enabled him to travel to the Chinese mainland without a visa. He renewed that identification card in 2015 at his sister’s suggestion in case they decided to travel to mainland China. They never did. He also received a different identification card from Hong Kong when he was a child. He renewed that card in 2005. When Applicant realized the cards raised security concerns, he gave them to his assistant facility security officer who destroyed them. Applicant credibly stated that his allegiance lies with the United States. He stated that he would report any attempt to use his family in Hong Kong against him.6

Applicant submitted a letter from his supervisor attesting to Applicant’s excellent job performance, reliability, professionalism, honesty, dependability, trustworthiness, integrity, and loyalty to the United States.7

Hong Kong and the PRC

The PRC is a large and economically powerful country, with a population of over a billion people. The PRC has an authoritarian government, dominated by the Chinese Communist Party. The PRC has a poor record with respect to human rights, suppresses political dissent, and its practices include arbitrary arrest and detention, forced confessions, torture, and mistreatment of prisoners.

The PRC engages in espionage against the United States and is one of the two most active collectors of U.S. economic intelligence and technology. The PRC’s intelligence services, as well as private companies and other entities, frequently seek to exploit Chinese citizens or persons with family ties to China who can use their insider access to corporate networks to steal state secrets.

Hong Kong

Hong Kong has been a Special Administrative Region of the PRC since July 1, 1997, ending more than 150 years of British colonial rule. Hong Kong has a high degree of autonomy, except in the areas of defense and foreign policy, which are the responsibility of the PRC. The Hong Kong Special Administrative Region is headed by a Chief Executive voted on by an Election Committee made up of approximately 800 Hong Kong residents from four constituency groups, including the PRC’s National People’s Congress.

While Hong Kong remains a free and open society where human rights are respected, courts are independent, and there is a well-established respect for the rule of law, concerns include the limited ability of residents to change their government, limitations on freedom of the press and expression, academic freedom, arbitrary arrest and detention, aggressive police tactics hampering freedom of assembly, trafficking in persons, and societal prejudice against certain ethnic minorities.

POLICIES

When evaluating an applicant’s suitability for a security clearance, the administrative judge must consider the adjudicative guidelines. In addition to brief introductory explanations for each guideline, the adjudicative guidelines list potentially disqualifying conditions and mitigating conditions, which are to be used in evaluating an applicant’s eligibility for access to classified information.

These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, administrative judges apply the guidelines in conjunction with the factors listed in the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. According to AG ¶ 2(c), the entire process is a conscientious scrutiny of a number of variables known as the “whole-person concept.” The administrative judge must consider all available, reliable information about the person, past and present, favorable and unfavorable, in making a decision.

The protection of the national security is the paramount consideration. AG ¶ 2(b) requires that “[a]ny doubt concerning personnel being considered for access to classified information will be resolved in favor of national security.” Under Directive ¶ E3.1.14, the Government must present evidence to establish controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, the applicant is responsible for presenting “witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by the applicant or proven by Department Counsel.” The applicant has the ultimate burden of persuasion to obtain a favorable security decision.

A person who seeks access to classified information enters into a fiduciary relationship with the Government predicated upon trust and confidence. This relationship transcends normal duty hours and endures throughout off-duty hours. The Government reposes a high degree of trust and confidence in individuals to whom it grants access to classified information. Decisions include, by necessity, consideration of the possible risk the applicant may deliberately or inadvertently fail to safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation of potential, rather than actual, risk of compromise of classified information.

Section 7 of EO 10865 provides that adverse decisions shall be “in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.” See also EO 12968, Section 3.1(b) (listing multiple prerequisites for access to classified or sensitive information).

ANALYSIS

Guideline B, Foreign Influence

The security concern for foreign influence is set out in AG ¶ 6:

Foreign contacts and interests may be a security concern if the individual has divided loyalties or foreign financial interests, may be manipulated or induced to help a foreign person, group, organization, or government in a way that is not in U.S. interests, or is vulnerable to pressure or coercion by any foreign interest. Adjudication under this Guideline can and should consider the identity of the foreign country in which the foreign contact or financial interest is located, including, but not limited to, such considerations as whether the foreign country is known to target United States citizens to obtain protected information and/or is associated with a risk of terrorism.

The guideline notes several conditions that could raise security concerns under AG ¶ 7. The following are potentially applicable in this case:

(a) contact with a foreign family member, business or professional associate, friend, or other person who is a citizen of or resident in a foreign country if that contact creates a heightened risk of foreign exploitation, inducement, manipulation, pressure, or coercion; and (b) connections to a foreign person, group, government, or country that create a potential conflict of interest between the individual’s obligation to protect sensitive information or technology and the individual’s desire to help a foreign person, group, or country by providing that information.

Applicant’s father and sister are U.S. citizens living in Hong Kong. His stepmother is a Chinese citizen living in Hong Kong. The PRC has an authoritarian government, dominated by the Communist Party, with a poor human rights record, and targets the U.S. for espionage. Applicant’s contacts in Hong Kong create a potential conflict of interest and a heightened risk of foreign exploitation, inducement, manipulation, pressure, and coercion. AG ¶¶ 7(a) and 7(b) have been raised by the evidence.

Conditions that could mitigate foreign influence security concerns are provided under AG ¶ 8. The following are potentially applicable:

(a) the nature of the relationships with foreign persons, the country in which these persons are located, or the positions or activities of those persons in that country are such that it is unlikely the individual will be placed in a position of having to choose between the interests of a foreign individual, group, organization, or government and the interests of the U.S.; and

(b) there is no conflict of interest, either because the individual’s sense of loyalty or obligation to the foreign person, group, government, or country is so minimal, or the individual has such deep and longstanding relationships and loyalties in the U.S., that the individual can be expected to resolve any conflict of interest in favor of the U.S. interest.

Applicant was born in Hong Kong while it was still a British territory. British culture and capitalism influenced him as a youth, not the Chinese mainland dominated by the Communist Party. He immigrated to the United States with his parents and two siblings when he was about 12 years old, long before Hong Kong reverted to the PRC in 1997. Hong Kong is not what it was before the reversion, but it still has a high degree of autonomy, except in the areas of defense and foreign policy, which are the responsibility of the PRC.

I considered the totality of Applicant’s ties to Hong Kong, but they are outweighed by his deep and longstanding relationships and loyalties in the United States. Applicant has been a U.S. citizen for about 27 years. His father chose to move back to Hong Kong and his sister lives in Hong Kong with her husband who is a citizen of a British Commonwealth country. Applicant has shown no inclination to follow them. He has made relatively few visits to Hong Kong since he immigrated to the United States. His life, home, assets, and professional career are in the United States. He credibly stated that he would report any attempt to use his family in Hong Kong against him. I find that it is unlikely Applicant will be placed in a position of having to choose between the interests of the United States and the interests of China. There is no conflict of interest, because Applicant can be expected to resolve any conflict of interest in favor of the United States. AG ¶¶ 8(a) and 8(b) are applicable.

Guideline C, Foreign Preference

The security concern for foreign preference is set out in AG ¶ 9:

When an individual acts in such a way as to indicate a preference for a foreign country over the United States, then he or she may be prone to provide information or make decisions that are harmful to the interests of the United States.

The guideline notes several conditions that could raise security concerns under AG ¶ 10. The following are potentially applicable in this case:

(a) exercise of any right, privilege or obligation of foreign citizenship after becoming a U.S. citizen or through the foreign citizenship of a family member. This includes but is not limited to:

(1) possession of a current foreign passport;

(3) accepting educational, medical, retirement, social welfare, or other such benefits from a foreign country; and

(b) action to acquire or obtain recognition of a foreign citizenship by an American citizen.

Applicant was a British citizen when he immigrated to the United States. He has never been a citizen of the PRC or of the Hong Kong Special Administrative Region after it reverted to China. His possession of the travel and identification cards did not convey citizenship upon him, but he was able to obtain the cards because of his past status. No specific foreign preference disqualifying condition has been raised by Applicant’s possession of the cards. However, the action could indicate a preference for Hong Kong over the United States, and it is a privilege granted by Hong Kong because of his former status. A general foreign preference security concern under AG ¶ 9 has been raised, even without the applicability of a specific disqualifying condition.

Conditions that could mitigate foreign preference security concerns are provided under AG ¶ 11. The following is potentially applicable:

(e) the passport has been destroyed, surrendered to the cognizant security authority, or otherwise invalidated.

Applicant gave the cards to his assistant facility security officer who destroyed them. Foreign preference concerns are mitigated.

WHOLE PERSON CONCEPT

Under the whole-person concept, the administrative judge must evaluate an applicant’s eligibility for a security clearance by considering the totality of the applicant’s conduct and all relevant circumstances. The administrative judge should consider the nine adjudicative process factors listed at AG ¶ 2(a):

(1) the nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the conduct, to include knowledgeable participation; (3) the frequency and recency of the conduct; (4) the individual’s age and maturity at the time of the conduct; (5) the extent to which participation is voluntary; (6) the presence or absence of rehabilitation and other permanent behavioral changes; (7) the motivation for the conduct; (8) the potential for pressure, coercion, exploitation, or duress; and (9) the likelihood of continuation or recurrence.

Under AG ¶ 2(c), the ultimate determination of whether to grant eligibility for a security clearance must be an overall commonsense judgment based upon careful consideration of the guidelines and the whole-person concept.

I considered the potentially disqualifying and mitigating conditions in light of all the facts and circumstances surrounding this case. I have incorporated my comments under Guidelines B and C in my whole-person analysis. I considered Applicant’s ties to Hong Kong, but they are far outweighed by his deep and longstanding relationships and loyalties in the United States.

Overall, the record evidence leaves me without questions or doubts as to Applicant’s eligibility and suitability for a security clearance. I conclude Applicant mitigated the foreign influence and foreign preference security concerns.

FORMAL FINDINGS

Formal findings for or against Applicant on the allegations set forth in the SOR, as required by section E3.1.25 of Enclosure 3 of the Directive, are:

Paragraph 1, Guideline C: For Applicant

Subparagraphs 1.a-1.b: For Applicant

Paragraph 2, Guideline B: For Applicant

Subparagraphs 2.a-2.b: For Applicant

CONCLUSION

In light of all of the circumstances presented by the record in this case, it is clearly consistent with the national interest to grant Applicant eligibility for a security clearance. Eligibility for access to classified information is granted.

________________________ Edward W. Loughran Administrative Judge

FOOTNOTES

1 Tr. at 14-19, 45, 53-56; Applicant’s response to SOR; GE 1, 2. 2 Tr. at 14-17, 21-22, 28, 36, 49, 54; Applicant’s response to SOR; GE 1, 2. 3 Tr. at 15, 21-25, 40-42, 50, 59-63; Applicant’s response to SOR; GE 1, 2. 4 Tr. at 25-28, 42-44; Applicant’s response to SOR; GE 1, 2. 5 Tr. at 28-32, 45-46; GE 1, 2; AE B. 6 Tr. at 30-40, 64-73; Applicant’s response to SOR; GE 1, 2; AE A. 7 AE E.