CASE · Clearance Adjudication Search EngineCASE

Loading case…

ISCR Case 16-03321.h1 — CASE

ISCR Case 16-03321.h1granted

Case Headnote

ISCR Case No. 16-03321.h1

grantedOct 31, 2017· Hon. Paul J. Mason· hearing

Summary

A 56-year-old Air Force veteran was granted a security clearance despite initial concerns under Guideline F (Financial Considerations). The primary issue was his failure to file federal income tax returns for the years 2012 through 2015. This lapse was attributed to the significant emotional and physical demands he faced while caring for his ailing mother and former wife during that period.

The applicant successfully mitigated these concerns by subsequently filing his overdue federal income tax returns for 2013, 2014, and 2015. The adjudicator recognized that the circumstances contributing to his failure to file were largely beyond his control, aligning with mitigating conditions related to unforeseen difficulties.

Ultimately, the decision to grant the clearance was based on the applicant's proactive steps to resolve his tax obligations and his demonstrated commitment to responsible financial behavior moving forward.

Why the Applicant Prevailed

The applicant filed his federal income tax returns for 2013, 2014, and 2015, mitigating the financial concerns.
The circumstances leading to the failure to file were largely beyond the applicant's control, involving caregiving responsibilities.
The applicant demonstrated a commitment to addressing his tax issues in a timely manner moving forward.

Conditions Referenced

Disqualifying

AG ¶ 19(f)raisedFailure to File Tax Returns

Mitigating

AG ¶ 20(a)appliedBehavior Unlikely to Recur
AG ¶ 20(b)appliedCircumstances Beyond Control
AG ¶ 20(g)appliedArrangements with Tax Authority

Key Rule Quoted

“The final security clearance decision must be an overall commonsense judgment based upon careful consideration of the specific guidelines, each of which is to be evaluated in the context of the whole person.”

Procedural Posture

SOR issuedDec 4, 2016
Answer filedJan 19, 2017
Hearing held—Applicant appeared pro se.
Decision dateOct 31, 2017

Cite For

Mitigation of Financial Issues Under Guideline F Due to Caregiving Responsibilities
Consideration of Personal Circumstances in Tax Filing Failures
Whole-person Concept in Security Clearance Evaluations

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 F · descriptive summary of a decided case

Posture: Decision on RecordDecided: granted

The judge found that the applicant's failure to file federal income tax returns for 2012 through 2015 was mitigated by challenging personal circumstances, including caring for his mother and former wife. The applicant filed the missing tax returns and was due refunds for the years filed, leading to a decision in favor of the applicant under Guideline F.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	failed to file his federal income tax returns for tax years 2012, 2013, 2014, and 2015	For Applicant	Tax Filing Failure	Admitted	(f) failure to file / fraudulent filing of tax returns or unpaid tax	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (g) arrangements made with the tax authority; in compliance	Claimed Other

Descriptive standardized rendering of a decided public case (Guideline F). 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. 16-03321 ) ) Applicant for Security Clearance )

For Government: Bryan Olmos, Esq., Department Counsel For Applicant: Pro se

10/31/2017

______________

STATEMENT OF CASE

______________

MASON, Paul J., Administrative Judge:

By filing his 2013, 2014, and 2015 federal income tax returns, Applicant has mitigated the security concerns arising from the guideline for financial considerations. Eligibility for access to classified information is granted.

Statement of the Case

On March 3, 2016, Applicant signed and certified an Electronic Questionnaires for Investigations Processing (e-QIP). (Item 3) He provided an interview (PSI) to an investigator from the Office of Personnel Management (OPM) on July 6, 2016. (Item 4) On December 4, 2016, the Department of Defense (DOD) issued a Statement of Reasons (SOR) detailing security concerns under financial considerations (Guideline F). The action was taken in accordance with Executive Order 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended; Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines (AG) dated September 1, 2006.

Applicant furnished his notarized answer to the SOR on January 19, 2017. A copy of the Government’s File of Relevant Material (FORM), the Government’s evidence in support of the allegations of the SOR, was sent to Applicant on February 13, 2017. He received the FORM on March 26, 2017, and was instructed to file objections or submit additional information within 30 days of receiving the FORM. His two responses were received by the Defense Office of Hearings and Appeals (DOHA) on April 20, 2017, and May 26, 2017. The case was assigned to me on October 1, 2017.

Evidentiary Rulings

In a footnote on the second page of the FORM, Applicant was advised he could make corrections to the July 2016 PSI (Item 4) to improve the exhibit’s clarity and accuracy. Alternatively, he was advised that since the PSI was unauthenticated, he could object to the entire exhibit and it would not be admitted into evidence. Applicant did not object, and the July 2016 PSI is entered into the evidence.

FINDINGS OF FACT

The SOR alleges that Applicant failed to file his federal income tax returns for tax years 2012, 2013, 2014, and 2015. Applicant admitted the allegation and indicated that the “taxes are currently filed.”

Applicant is 56 years old and divorced with a 27-year-old son. In May 2004, he received an honorable discharge after almost 25 years of service in the United States Air Force (USAF). He has had a security clearance since February 2006. While in the USAF, his security clearance was temporarily suspended in August 2003 for using a military telephone in an unauthorized manner. Applicant attended college from March 2011 to December 2013, but did not receive a degree. The only other financial issue in the record is a $3,000 credit card debt that Applicant was disputing. (Item 3)

In his July 2016 PSI and April 20, 2017 response to the FORM, Applicant explained that his mother’s sickness from 2012 until her death in February 2015, was the primary reason for not filing the federal income tax returns. Once it was discovered that his mother had dementia, she requested that she live under his care rather than in a nursing home. He soon learned about the daunting responsibilities of caring for a person suffering dementia. During the period, he also had to provide support for his former wife who was suffering from a serious medical condition. Applicant explained that his focus on caring for his mother and former wife caused him to lose focus on his responsibility of filing tax returns. (Item 4; April 2017 response to FORM)

In Applicant’s April 20, 2017 response to the FORM, he provided documentation from the Internal Revenue Service (IRS) verifying that he filed federal tax returns for 2013, 2014, and 2015. On April 10, 2017, Applicant received documentation from the IRS that his 2013 tax return was filed. The IRS noted that after correcting the miscalculations, the adjusted tax refund was $3,742. On March 27, 2017, Applicant received documentation from the IRS indicating that after correcting the miscalculations in his tax returns for tax years 2014 and 2015, the adjusted tax refunds were $4,663 and $6,427, respectively. (April 2017 response to the FORM)

In his May 26, 2017 response to the FORM, Applicant submitted copies of his federal income tax returns for 2016 and 2012. The copies are incomplete because they are missing a signature page. (May 2017 response to the FORM) Applicant has filed federal tax returns for 2013, 2014, and 2015. In the future, Applicant intends to address his tax issues in a timely manner.

POLICIES

When evaluating an applicant's suitability for a security clearance, the administrative judge must consider the guidelines in the AG. Each guideline lists potentially disqualifying conditions and mitigating conditions that are useful in evaluating an applicant's eligibility for access to classified information.

The administrative judge's ultimate goal is to reach a fair and impartial decision that is based on sound and prudent judgment. The decision should also include a careful, thorough evaluation of a number of general factors known as the "whole-person concept" that brings together all available, reliable information about the person, past and present, favorable and unfavorable, in making a decision. Decisions include, by necessity, consideration of the possible risk the applicant may deliberately or inadvertently fail to protect or safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation as to the potential, rather than actual, risk of compromise of classified information.

Under Directive ¶ E3.l.14., the Government must present evidence to establish controverted facts alleged in the SOR. Under Directive ¶ E3.l.l5., the applicant is responsible for presenting "witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by applicant or proven by Department Counsel. . . ." The applicant bears the ultimate burden of persuasion in demonstrating that he warrants a favorable security clearance decision.

ANALYSIS

The security concern for financial considerations is set forth in AG ¶ 18:

Failure to live within one's means, satisfy debts, and meet financial obligations may indicate poor self-control, lack of judgment, or unwillingness to abide by rules and regulations, all of which can raise questions about an individual's reliability, trustworthiness and ability to protect classified or sensitive information. Financial distress can also be caused or exacerbated by, and thus can be a possible indicator of, other issues of personnel security concern such as excessive gambling, mental health conditions, substance misuse, or alcohol abuse or dependence. An individual who is financially overextended is at greater risk of having to engage in illegal or otherwise questionable acts to generate funds. Affluence that cannot be explained by known sources of income is also a security concern insofar as it may result from criminal activity, including espionage.

The concern of Guideline F is whether an applicant possesses the good judgment and trustworthiness necessary for safeguarding classified information at all times and in all places. An applicant who handles his personal finances irresponsibly or who fails to comply with rules and regulations, i.e., does not file tax returns, may display the same irresponsibility toward safeguarding classified information.

The disqualifying condition under AG ¶ 19 is:

(f) failure to file or fraudulently filing annual Federal, state, or local income tax returns or failure to pay annual Federal, state, or local income tax as required.

Applicant admitted in his March 2016 e-QIP and July 2016 PSI that he had not filed his federal income tax returns for 2012 through 2015. His conduct demonstrates an unwillingness to follow rules an regulations. DOHA Appeal Board has stated that an individual with a history of not filing tax returns may not have the necessary judgment required for handling classified information. See ISCR Case No. 12-05043 (App. Bd. Oct. 30, 2014). AG ¶ 19(f) applies.

The potential mitigating conditions under AG ¶ 20 are:

(a) the behavior happened so long ago, was so infrequent, or occurred under such circumstances that it is unlikely to recur and does not cast doubt on the individual's reliability, trustworthiness, and good judgment;

(b) the conditions that resulted in the financial problem were largely beyond the person's control (e.g., loss of employment, a business downturn, unexpected medical emergency, a death, divorce or separation, clear victimization by predatory lending practices, or identify theft), and the individual acted responsibly under the circumstances; resolved or is under control;

(g) the individual has made arrangements with the appropriate tax authority to file or pay the amount owed and is in compliance with those arrangements.

Applicant’s failure to file federal tax returns for 2012 through 2015 occurred under challenging circumstances that are unlikely to recur and no longer raise doubts about his current judgment and trustworthiness. AG ¶ 20(a) applies in part.

The circumstances that resulted in Applicant’s failure to file his federal income tax returns were largely beyond his control. His mother was suffering from dementia and preferred Applicant to provide care over the care that would be provided by a senior citizen’s facility. Though he agreed to care for her, his consent was motivated by a desire to comply with her wish during the final years of her life. It is clear that he did not fully comprehend the emotional toll that her quickly declining physical and mental condition would have on him. As a result, he neglected to file his federal income tax returns. Because he did not file the missing tax returns until after he received the SOR in December 2016, he receives only partial mitigation under AG ¶ 20(b).

The IRS documentation shows that Applicant filed tax returns for 2013, 2014, and 2015. He was due a tax refund for each of years filed. AG ¶ 20(g) applies.

WHOLE PERSON CONCEPT

I have examined the evidence under the disqualifying and mitigating conditions of the financial considerations guideline. I have also weighed the circumstances within the context of nine variables of the whole-person concept. In evaluating the relevance of an individual's conduct, the administrative judge should consider the following factors listed in AG ¶ 2(d): (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 the participation was 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).

The final security clearance decision must be an overall commonsense judgment based upon careful consideration of the specific guidelines, each of which is to be evaluated in the context of the whole person. (AG ¶ 2(c)) Applicant has held a security clearance since 2006. Rendering total care for his mother and support for his former wife provides compelling reasons for not filing his federal tax returns on time. He has substantially complied with his duty as an American citizen to file his federal tax returns, though the filing did not occur until after he received the SOR in December 2016. The federal tax returns for 2013, 2014, and 2015 have been filed. There is some evidence that the federal tax returns for 2012 and 2016 have been filed. Judging by the totality of the evidence under the factors against and for clearance, and the factors of the whole-person concept, Applicant has mitigated th security concerns arising from the guideline for financial considerations. See AG ¶¶ 2(d)(1) through 2(d)(9).

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 F): FOR APPLICANT

Subparagraph 1.a: For Applicant

CONCLUSION

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

Paul J. Mason Administrative Judge