ISCR Case 11-07487.h1

Case Headnote

ISCR Case No. 11-07487.h1

deniedApr 27, 2018· Hon. Arthur E. Marshall, Jr.· hearing

Summary

A 42-year-old CEO and Chairman was denied a security clearance due to concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The denial stemmed from multiple instances of dishonesty and financial irresponsibility, with the judge citing deliberate omissions and inaccuracies in the applicant's security clearance application as significant concerns regarding his reliability and trustworthiness.

Specifically, the applicant failed to disclose a prior defense contractor position, his departure from that job following misconduct allegations, and contact with Pakistani government officials for business purposes. He also omitted a civil court lawsuit where he was a defendant. Later, in an annulment petition, he falsely certified having no minor children with his then-wife, despite having three pre-teen children, and used an address solely to establish residency for the annulment. Additionally, he provided an inaccurate response to a DOHA interrogatory regarding an employee's salary and was questioned about approximately 28 cash transactions totaling about $1,500,000.

Financially, the applicant had numerous outstanding debts, including a $10,149 collection account settled for less than the full balance, a $100,324 charged-off second mortgage, and a $10,046 charged-off home improvement credit card also settled for less than the full balance. He also had unpaid state tax liens totaling $34,520 and $42,954, $850 in child support arrears, and multiple past-due student loan accounts. Adverse judgments for attorney's fees ($15,000), child support ($5,579), and temporary spousal support ($15,000) were on appeal. Several other collection accounts for telecommunications and cable television were paid.

Why the Applicant Was Denied

The applicant provided false information on his security clearance application regarding previous employment and legal matters.
He failed to disclose significant debts and financial obligations, including tax liens and child support arrears.
The applicant's pattern of dishonesty and lack of candor undermined his credibility and trustworthiness.

Conditions Referenced

Disqualifying

AG ¶ 16(a)raisedDeliberate Omission, Concealment, or Falsification of Relevant Facts
AG ¶ 16(b)raisedDeliberately Providing False or Misleading Information

Key Rule Quoted

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

Procedural Posture

SOR issuedMar 11, 2015
Answer filedJun 23, 2015
Hearing heldFeb 14, 2017
Decision dateApr 27, 2018

Cite For

Issues of Personal Conduct and Dishonesty in Security Clearance Applications
Financial Irresponsibility as a Disqualifying Factor
The Importance of Candor 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.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
1.a	On or about November 19, 2008, Applicant completed a security clearance application (SCA). In answering this question, Applicant did not disclose a position with a defense contractor held from November 19, 2004, through December 20, 2005.	Against Applicant	Omission or Failure to DiscloseFOUND DELIBERATE	Employment History	Denied	(a) deliberate omission, concealment, or falsification on a security form	—	—
1.b	On that same 2008 SCA, Applicant answered “no” in response to 'Has any of the following happened to you in the past 7 years? ... Left a job by mutual agreement following allegations of misconduct.' By answering “no,” Applicant failed to disclose that he left the job noted above by mutual agreement following an involuntary termination, which he contested, and allegations of conflict of interest.	Against Applicant	Omission or Failure to DiscloseFOUND DELIBERATE	Employment History	Denied	(a) deliberate omission, concealment, or falsification on a security form	—	—
1.c	In addition, 'Have you ever had any contact with a foreign government, its establishments (embassies or consulates), or its representatives...?' In response, Applicant answered “No.” As a result, he failed to disclose that during a trip to Pakistan in or about August 2004, he had contact with Pakistani government and/or provincial or local officials for the purpose of soliciting business from such officials.	Against Applicant	Omission or Failure to DiscloseFOUND DELIBERATE	Foreign Contacts or Interests	Denied	(a) deliberate omission, concealment, or falsification on a security form	—	—
1.d	Applicant answered “no” to a question in that 2008 SCA regarding whether he had been a party to any public record civil court actions not listed elsewhere on this form. In truth, however, he was a defendant in a lawsuit brought by a company in a state county circuit court in or about 2006.	For Applicant	Omission or Failure to DiscloseNOT DELIBERATE	Other	Denied	—	—	—
1.e	Later, in about August 2011, Applicant submitted a proposed Decree of Annulment to a state district court in which he certified that there were no minor children born of his union with his then-wife. In so doing, he neglected to note his three pre-teen children.	Against Applicant	Omission or Failure to DiscloseFOUND DELIBERATE	Other	Denied	(a) deliberate omission, concealment, or falsification on a security form	—	—
1.f	Applicant denied having children with his then-wife, a former “drinky girl” from Asia. He believed this at the time because she had told him that, although they had been sexually active, she had conducted affairs in his absence. Later, after DNA testing, he accepts them as his own.	For Applicant	Questionable Judgment General	—	Denied	—	—	—
1.g	As for the address Applicant noted as in-state for purposes of the annulment petition, it was the address of residency he established in order to proceed with an annulment in that state.	For Applicant	Questionable Judgment General	—	Denied	—	—	—
1.h	On March 26, 2014, Applicant signed a copy of his responses to interrogatories proposed by DOHA. In so doing, he answered “no” in response to interrogatory Number 3, as to whether a particular female employee had worked for salary for a specific employer.	Against Applicant	Lack of Candor in InterviewFOUND DELIBERATE	—	Denied	(b) deliberately providing false information to an investigator or official	—	—
1.i	Moreover, Applicant addressed interrogatory Number 10, which noted 'available information reflects that you were engaged in approximately 28 cash transactions with a total value of about $1,500,000 during the period September 1996 through May 1997.'	Against Applicant	Lack of Candor in InterviewFOUND DELIBERATE	—	Denied	(b) deliberately providing false information to an investigator or official	—	—

Allegation

Finding

Conduct

Concealed Issue

Response

Disqualifying (¶16)

Mitigating applied (¶17)

Mitigation

1.a

On or about November 19, 2008, Applicant completed a security clearance application (SCA). In answering this question, Applicant did not disclose a position with a defense contractor held from November 19, 2004, through December 20, 2005.

Against Applicant

Omission or Failure to DiscloseFOUND DELIBERATE

Employment History

Denied

(a) deliberate omission, concealment, or falsification on a security form

—

1.b

On that same 2008 SCA, Applicant answered “no” in response to 'Has any of the following happened to you in the past 7 years? ... Left a job by mutual agreement following allegations of misconduct.' By answering “no,” Applicant failed to disclose that he left the job noted above by mutual agreement following an involuntary termination, which he contested, and allegations of conflict of interest.

Against Applicant

Omission or Failure to DiscloseFOUND DELIBERATE

Employment History

Denied

(a) deliberate omission, concealment, or falsification on a security form

—

1.c

In addition, 'Have you ever had any contact with a foreign government, its establishments (embassies or consulates), or its representatives...?' In response, Applicant answered “No.” As a result, he failed to disclose that during a trip to Pakistan in or about August 2004, he had contact with Pakistani government and/or provincial or local officials for the purpose of soliciting business from such officials.

Against Applicant

Omission or Failure to DiscloseFOUND DELIBERATE

Foreign Contacts or Interests

Denied

(a) deliberate omission, concealment, or falsification on a security form

—

1.d

Applicant answered “no” to a question in that 2008 SCA regarding whether he had been a party to any public record civil court actions not listed elsewhere on this form. In truth, however, he was a defendant in a lawsuit brought by a company in a state county circuit court in or about 2006.

For Applicant

Omission or Failure to DiscloseNOT DELIBERATE

Other

Denied

—

1.e

Later, in about August 2011, Applicant submitted a proposed Decree of Annulment to a state district court in which he certified that there were no minor children born of his union with his then-wife. In so doing, he neglected to note his three pre-teen children.

Against Applicant

Omission or Failure to DiscloseFOUND DELIBERATE

Other

Denied

(a) deliberate omission, concealment, or falsification on a security form

—

1.f

Applicant denied having children with his then-wife, a former “drinky girl” from Asia. He believed this at the time because she had told him that, although they had been sexually active, she had conducted affairs in his absence. Later, after DNA testing, he accepts them as his own.

For Applicant

Questionable Judgment General

—

Denied

—

1.g

As for the address Applicant noted as in-state for purposes of the annulment petition, it was the address of residency he established in order to proceed with an annulment in that state.

For Applicant

Questionable Judgment General

—

Denied

—

1.h

On March 26, 2014, Applicant signed a copy of his responses to interrogatories proposed by DOHA. In so doing, he answered “no” in response to interrogatory Number 3, as to whether a particular female employee had worked for salary for a specific employer.

Against Applicant

Lack of Candor in InterviewFOUND DELIBERATE

—

Denied

(b) deliberately providing false information to an investigator or official

—

1.i

Moreover, Applicant addressed interrogatory Number 10, which noted 'available information reflects that you were engaged in approximately 28 cash transactions with a total value of about $1,500,000 during the period September 1996 through May 1997.'

Against Applicant

Lack of Candor in InterviewFOUND DELIBERATE

—

Denied

(b) deliberately providing false information to an investigator or official

—

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
2.a	Collection account ($10,149) – Settled for less than full balance. This debt is related to a window purchase for Applicant and his former spouse’s home. $10,149	Against Applicant	Unspecified Financial	Unknown	—	—	—
2.b	Telecommunication collection account ($568) – Paid. $568	For Applicant	Unspecified Financial	Unknown	—	—	—
2.c	Student loan collection account ($3,425) – Status unclear. $3,425	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.d	Student loan collection account ($2,884) – Status unclear. $2,884	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.e	Cable television collection account ($102) – Paid. $102	For Applicant	Utility or Phone Debt	Unknown	—	—	—
2.f	Approximate past-due (180+ days) student loan account balance ($199) – Status unclear. $199	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.g	Approximate past-due (180+ days) student loan account balance ($174) – Status unclear. $174	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.h	Approximate past-due (180+ days) student loan account balance ($36) – Status unclear. $36	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.i	Approximate past-due (180+ days) student loan account balance ($430) – Status unclear. $430	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.j	Approximate past-due (180+ days) student loan account balance ($51) – Status unclear. $51	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.k	Approximate past-due (180+ days) student loan account balance ($170) – Status unclear. $170	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.l	Approximate past-due (180+ days) student loan account balance ($209) – Status unclear. $209	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.m	Approximate past-due (180+ days) student loan account balance ($77) – Status unclear. $77	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.n	Approximate past-due (180+ days) student loan account balance ($133) – Status unclear. $133	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.o	Student loan collection balance (balance unknown) – Status unclear.	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.p	Student loan collection balance (balance unknown) – Status unclear.	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.q	Second mortgage charged-off account balance ($100,324) – Status unclear. $100,324	Against Applicant	Unspecified Financial	Unknown	—	—	—
2.r	Home improvement charged-off bank credit card ($10,046) – Settled for less than full balance. $10,046	For Applicant	Credit Card Debt	Unknown	—	—	—
2.s	State tax lien ($34,520) – Unpaid. $34,520	Against Applicant	Tax Unpaid	Unknown	(a) inability to satisfy debts	—	—
2.t	Cable television collection account ($120) – Paid. $120	For Applicant	Utility or Phone Debt	Unknown	—	—	—
2.u	Cable television collection account ($175) – Paid. $175	For Applicant	Utility or Phone Debt	Unknown	—	—	—
2.v	Child support collection balance ($850) – In arrears. $850	Against Applicant	Child Support Debt	Unknown	(a) inability to satisfy debts	—	—
2.w	Approximate past-due (120+ days) student loan account balances ($205) – Status unclear. $205	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.x	Approximate past-due (120+ days) student loan account balances ($173) – Status unclear. $173	Against Applicant	Student Loan Debt	Unknown	—	—	—
2.y	State tax lien ($42,954) – Unpaid. $42,954	Against Applicant	Tax Unpaid	Unknown	(a) inability to satisfy debts	—	—
2.z	Adverse judgments for $15,000 (attorney’s fees), $5,579 (child support), and $15,000 (temporary ex-spousal support) – On appeal. $30,079	Against Applicant	Judgment Against Applicant	Unknown	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

2.a

Collection account ($10,149) – Settled for less than full balance. This debt is related to a window purchase for Applicant and his former spouse’s home.

$10,149

Against Applicant

Unspecified Financial

Unknown

—

2.b

Telecommunication collection account ($568) – Paid.

$568

For Applicant

Unspecified Financial

Unknown

—

2.c

Student loan collection account ($3,425) – Status unclear.

$3,425

Against Applicant

Student Loan Debt

Unknown

—

2.d

Student loan collection account ($2,884) – Status unclear.

$2,884

Against Applicant

Student Loan Debt

Unknown

—

2.e

Cable television collection account ($102) – Paid.

$102

For Applicant

Utility or Phone Debt

Unknown

—

2.f

Approximate past-due (180+ days) student loan account balance ($199) – Status unclear.

$199

Against Applicant

Student Loan Debt

Unknown

—

2.g

Approximate past-due (180+ days) student loan account balance ($174) – Status unclear.

$174

Against Applicant

Student Loan Debt

Unknown

—

2.h

Approximate past-due (180+ days) student loan account balance ($36) – Status unclear.

$36

Against Applicant

Student Loan Debt

Unknown

—

2.i

Approximate past-due (180+ days) student loan account balance ($430) – Status unclear.

$430

Against Applicant

Student Loan Debt

Unknown

—

2.j

Approximate past-due (180+ days) student loan account balance ($51) – Status unclear.

$51

Against Applicant

Student Loan Debt

Unknown

—

2.k

Approximate past-due (180+ days) student loan account balance ($170) – Status unclear.

$170

Against Applicant

Student Loan Debt

Unknown

—

2.l

Approximate past-due (180+ days) student loan account balance ($209) – Status unclear.

$209

Against Applicant

Student Loan Debt

Unknown

—

2.m

Approximate past-due (180+ days) student loan account balance ($77) – Status unclear.

$77

Against Applicant

Student Loan Debt

Unknown

—

2.n

Approximate past-due (180+ days) student loan account balance ($133) – Status unclear.

$133

Against Applicant

Student Loan Debt

Unknown

—

2.o

Student loan collection balance (balance unknown) – Status unclear.

Against Applicant

Student Loan Debt

Unknown

—

2.p

Student loan collection balance (balance unknown) – Status unclear.

Against Applicant

Student Loan Debt

Unknown

—

2.q

Second mortgage charged-off account balance ($100,324) – Status unclear.

$100,324

Against Applicant

Unspecified Financial

Unknown

—

2.r

Home improvement charged-off bank credit card ($10,046) – Settled for less than full balance.

$10,046

For Applicant

Credit Card Debt

Unknown

—

2.s

State tax lien ($34,520) – Unpaid.

$34,520

Against Applicant

Tax Unpaid

Unknown

(a) inability to satisfy debts

—

2.t

Cable television collection account ($120) – Paid.

$120

For Applicant

Utility or Phone Debt

Unknown

—

2.u

Cable television collection account ($175) – Paid.

$175

For Applicant

Utility or Phone Debt

Unknown

—

2.v

Child support collection balance ($850) – In arrears.

$850

Against Applicant

Child Support Debt

Unknown

(a) inability to satisfy debts

—

2.w

Approximate past-due (120+ days) student loan account balances ($205) – Status unclear.

$205

Against Applicant

Student Loan Debt

Unknown

—

2.x

Approximate past-due (120+ days) student loan account balances ($173) – Status unclear.

$173

Against Applicant

Student Loan Debt

Unknown

—

2.y

State tax lien ($42,954) – Unpaid.

$42,954

Against Applicant

Tax Unpaid

Unknown

(a) inability to satisfy debts

—

2.z

Adverse judgments for $15,000 (attorney’s fees), $5,579 (child support), and $15,000 (temporary ex-spousal support) – On appeal.

$30,079

Against Applicant

Judgment Against Applicant

Unknown

—

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Case Profile

Summary

Why the Applicant Was Denied

Conditions Referenced

Key Rule Quoted

Procedural Posture

Cite For

Full decision

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

APPEARANCES

STATEMENT OF CASE

FINDINGS OF FACT

POLICIES

ANALYSIS

WHOLE PERSON CONCEPT

FORMAL FINDINGS

CONCLUSION

FOOTNOTES