ISCR Case 01-02948.h1

Case Headnote

ISCR Case No. 01-02948.h1

grantedJan 18, 2002· Hon. Barry M. Sax· hearing

Summary

A 52-year-old U.S. citizen and Branch Manager was granted a security clearance after concerns were raised under Guideline B (Foreign Influence) and Guideline C (Foreign Preference). The applicant had lived in Hong Kong for ten years, working for a U.S. company, but never obtained Hong Kong citizenship or a passport. His wife is a Hong Kong national and a U.S. Permanent Resident residing with him in the U.S., while her six siblings and elderly mother, to whom the applicant provides minimal financial support (approximately US $800 annually), reside in Hong Kong. The applicant also maintains a Hong Kong bank account with about US$30,000, primarily used for his mother-in-law.

The Statement of Reasons also noted that the applicant's elderly mother and sister are U.S. citizens residing in Mexico. The applicant previously opened a consulting business in Hong Kong in 1985 and worked for a U.S. engineering firm there from 1990 to 1998, paying taxes that were reported to the IRS. He travels to Hong Kong periodically for business but does not hold permanent resident status there.

The judge determined that the government did not establish a case for Foreign Preference, as the applicant never acquired Hong Kong citizenship or a passport. Furthermore, the applicant successfully mitigated concerns regarding Foreign Influence, with his U.S. ties and professional obligations outweighing potential foreign influence. It was also found that his family members in Hong Kong were not in a position to exert undue influence. Consequently, the security clearance was granted.

Why the Applicant Prevailed

The applicant never acquired citizenship or a passport from Hong Kong, demonstrating no foreign preference.
The applicant's ties to the U.S. and his professional obligations outweighed any potential foreign influence.
The applicant's family members in Hong Kong were not in a position to exert undue influence over him.

Conditions Referenced

Disqualifying

DC 1rejectedForeign Preference - Dual Citizenship
DC 2rejectedForeign Preference - Passport
DC 8rejectedForeign Influence - Substantial Financial Interest

Mitigating

MC 1appliedForeign Influence - Family Members Not Agents of Foreign Power
MC 5appliedForeign Influence - Minimal Financial Interests

Key Rule Quoted

“A person seeking access to classified information enters into a fiduciary relationship with the Government based upon trust and confidence.”

Procedural Posture

SOR issuedAug 16, 2001
Answer filedSep 2, 2001
Hearing heldNov 27, 2001
Decision dateJan 18, 2002

Cite For

Mitigation of Foreign Influence Due to Minimal Financial Ties
Absence of Foreign Preference Despite Long-term Residence Abroad
Consideration of Family Ties in Security Clearance Determinations

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

¶	Allegation	Finding	Relationship	Country	Response	Disqualifying (¶7)	Mitigating applied (¶8)	Mitigation
2.a	Applicant's wife is a citizen of Hong Kong, and holds a "British National - Overseas" passport. She resides with Applicant in State A and is a Permanent Resident of the United States.	For Applicant	Spouse Dual or Foreign Citizen Immediate Family	Hong Kong	Admitted	—	—	—
2.b	Applicant's mother-in-law is a citizen of Hong Kong and currently resides there. The mother is elderly and speaks little English;	For Applicant	Parent in Foreign Country Immediate Family	Hong Kong	Admitted	—	—	—
2.c	Applicant provides financial assistance to his mother-in-law in Hong Kong through his Hong Kong bank account, in amounts as high as Hong Kong $6,000 a year (about US $800.00);	For Applicant	Financial Support to Foreign Relative Immediate Family	Hong Kong	Admitted	—	—	—
2.d	The six siblings of Applicant's wife are citizens of Hong Kong and currently reside there. Applicant rarely sees them and has little contact;	For Applicant	Sibling in Foreign Country Extended Family	Hong Kong	Admitted	—	—	—
2.e	Applicant's elderly mother, who is retired, and his sister are U.S. citizens who have resided in Mexico since 1991;	For Applicant	Unspecified Foreign Relationship Immediate Family	Mexico	Admitted	—	—	—

Allegation

Finding

Relationship

Country

Response

Disqualifying (¶7)

Mitigating applied (¶8)

Mitigation

2.a

Applicant's wife is a citizen of Hong Kong, and holds a "British National - Overseas" passport. She resides with Applicant in State A and is a Permanent Resident of the United States.

For Applicant

Spouse Dual or Foreign Citizen

Immediate Family

Hong Kong

Admitted

—

2.b

Applicant's mother-in-law is a citizen of Hong Kong and currently resides there. The mother is elderly and speaks little English;

For Applicant

Parent in Foreign Country

Immediate Family

Hong Kong

Admitted

—

2.c

Applicant provides financial assistance to his mother-in-law in Hong Kong through his Hong Kong bank account, in amounts as high as Hong Kong $6,000 a year (about US $800.00);

For Applicant

Financial Support to Foreign Relative

Immediate Family

Hong Kong

Admitted

—

2.d

The six siblings of Applicant's wife are citizens of Hong Kong and currently reside there. Applicant rarely sees them and has little contact;

For Applicant

Sibling in Foreign Country

Extended Family

Hong Kong

Admitted

—

2.e

Applicant's elderly mother, who is retired, and his sister are U.S. citizens who have resided in Mexico since 1991;

For Applicant

Unspecified Foreign Relationship

Immediate Family

Mexico

Admitted

—

¶	Allegation	Finding	Type	Response	Disqualifying (¶10)	Mitigating applied (¶11)	Mitigation
1.a	Applicant is a citizen of the U.S. He is not a Permanent Resident of Hong Kong;	For Applicant	Failure to Renounce or Surrender Foreign Status	Denied	—	—	—
1.b	Applicant travels to Hong Kong periodically on business for his United States firm, but does not do so to maintain his Permanent Resident status, since he has no such status;	For Applicant	Foreign Citizenship Acquisition or Application	Denied	—	—	—
1.c	Applicant does not have a Permanent Resident Status that "allows [him] to work in Hong Kong without a permit";	For Applicant	Failure to Renounce or Surrender Foreign Status	Denied	—	—	—
1.d	Applicant opened a consulting business in Hong Kong in 1985, but began working for his present employer, a U.S. engineering consulting firm, in 1990;	For Applicant	Unspecified Foreign Preference	Admitted	—	—	—
1.e	In 1990, Applicant became Principal and/or Director of the Hong Kong office of a U.S. company that engages in engineering. He was so employed until 1998, when he returned to the United States to become head of the firm's West Coast headquarters;	For Applicant	Unspecified Foreign Preference	Admitted	—	—	—
1.f	Applicant paid taxes in Hong Kong when he was working there. All such tax payments were reported to the U.S. Internal Revenue Service, which permitted a credit against his U.S. taxes. Since returning to the United States in 1998, he has not paid any taxes to Hong Kong;	For Applicant	Unspecified Foreign Preference	Admitted	—	—	—
1.g	Applicant continues to maintain a bank account in Hong Kong. He uses it mostly to provide money to his mother-in-law. He also maintains it because he has had the account for many years and has seen no reason to cancel it as yet, but he is willing to do so. The account contains about US$30,000.	For Applicant	Unspecified Foreign Preference	Admitted	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶10)

Mitigating applied (¶11)

Mitigation

1.a

Applicant is a citizen of the U.S. He is not a Permanent Resident of Hong Kong;

For Applicant

Failure to Renounce or Surrender Foreign Status

Denied

—

1.b

Applicant travels to Hong Kong periodically on business for his United States firm, but does not do so to maintain his Permanent Resident status, since he has no such status;

For Applicant

Foreign Citizenship Acquisition or Application

Denied

—

1.c

Applicant does not have a Permanent Resident Status that "allows [him] to work in Hong Kong without a permit";

For Applicant

Failure to Renounce or Surrender Foreign Status

Denied

—

1.d

Applicant opened a consulting business in Hong Kong in 1985, but began working for his present employer, a U.S. engineering consulting firm, in 1990;

For Applicant

Unspecified Foreign Preference

Admitted

—

1.e

In 1990, Applicant became Principal and/or Director of the Hong Kong office of a U.S. company that engages in engineering. He was so employed until 1998, when he returned to the United States to become head of the firm's West Coast headquarters;

For Applicant

Unspecified Foreign Preference

Admitted

—

1.f

Applicant paid taxes in Hong Kong when he was working there. All such tax payments were reported to the U.S. Internal Revenue Service, which permitted a credit against his U.S. taxes. Since returning to the United States in 1998, he has not paid any taxes to Hong Kong;

For Applicant

Unspecified Foreign Preference

Admitted

—

1.g

Applicant continues to maintain a bank account in Hong Kong. He uses it mostly to provide money to his mother-in-law. He also maintains it because he has had the account for many years and has seen no reason to cancel it as yet, but he is willing to do so. The account contains about US$30,000.

For Applicant

Unspecified Foreign Preference

Admitted

—

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Case Profile

Summary

Why the Applicant Prevailed

Conditions Referenced

Key Rule Quoted

Procedural Posture

Cite For

Full decision

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

SYNOPSIS

APPEARANCES

STATEMENT OF CASE

FINDINGS OF FACT

POLICIES

CONCLUSION

FORMAL FINDINGS

DECISION

FOOTNOTES