ISCR Case No. 26-00050

_____________________________________ ______________ ______________ DEFENSE LEGAL SERVICES AGENCY DEFENSE OFFICE OF HEARINGS AND APPEALS

In the matter of: )

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) ISCR Case No. 26-00050

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) Applicant for Security Clearance ) _____________________________________ ) Appearances For Government: Andre M. Gregorian, Esq., Department Counsel For Applicant: Pro se 08/12/2026 Decision CEFOLA, Richard A., Administrative Judge: Applicant did not mitigate the security concerns under Guideline F (Financial Considerations). Eligibility for access to classified information is denied. Statement of the Case Applicant submitted a Questionnaire for National Security Positions on January 24, 2025 (Questionnaire). On February 20, 2026, the Defense Counterintelligence and Security Agency (DCSA) issued a Statement of Reasons (SOR) to Applicant detailing security concerns under Guideline F (Financial Considerations). The action was taken under Executive Order 10865, Safeguarding Classified Information Within Industry (February 20, 1960), as amended; Department of Defense (DoD) Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines (AG) effective within DoD after June 8, 2017.

On April 9, 2026, Applicant responded to the SOR in writing (Answer) and requested that this case be decided on the written record in lieu of a hearing. In her Answer, she admitted to all tax issues alleged in the SOR. On May 21, 2026, Department Counsel submitted the Government’s written case in a File of Relevant Material (FORM). A complete copy of the FORM, consisting of Government’s Exhibits (GE) 1 to 5 and the Government’s arguments in support of the SOR, was received by Applicant on June 1, 2026. She was afforded an opportunity to file objections and submit material to refute, extenuate, or mitigate the security concerns, and she timely submitted an additional statement (Response). She also included Applicant’s Exhibit A, which is a tax preparation service agreement dated January 23, 2025. The case was assigned to me on August 3, 2026, and all exhibits were admitted without objection. Findings of Fact Applicant is 27 years old, single, and has no children. She completed high school and some college work. Applicant has been employed by a defense contractor since 2025 as a project management coordinator and applied for her first security clearance in connection with this employment. (GE 3 at 5, 11-12, 21, 31) SOR Paragraph 1 (Guideline F: Financial Considerations) The Government alleged that Applicant is ineligible for a security clearance because she has delinquent and unresolved tax issues. The following facts pertain: 1.a. Federal tax returns (2019 – 2024): Applicant admitted to the SOR allegation as drafted. Applicant averred that she believed her mother had been filing her taxes for her since tax year 2015. Only when preparing her responses to the Questionnaire did she look into the status of her taxes, whereupon she learned her mother had not filed either federal or state tax returns on her behalf since tax year 2018. On January 23, 2025, she retained the services of a tax preparation service. As of her Response on June 26, 2026, the tax returns remained unfiled. (Answer; Response; AE A; GE 4; GE 5 at 3) 1.b. State tax returns (2019 – 2024): See SOR ¶ 1.a discussion above. Whole Person Evidence Applicant stated in her Answer that since learning of the tax issue, she has been working on gathering all necessary documents to file her outstanding returns. She averred that she understood the seriousness of this matter and maintained that this lapse did not reflect her overall character or trustworthiness. She reiterated these comments in her Response and again insisted she was working on “bringing all filings current.” In addition to these matters, the comments and explanations Applicant included in her Questionnaire, interrogatories, and response to the defense investigator, were reviewed in their entirety. 2

Policies When evaluating an applicant’s suitability for national security eligibility, the administrative judge must consider the adjudicative guidelines. In addition to brief introductory explanations for each guideline, the adjudicative guidelines (AG) list potentially disqualifying conditions and mitigating conditions, which are to be used in evaluating an applicant’s national security eligibility. These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, these guidelines are applied in conjunction with the factors listed in AG ¶ 2 describing the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. The entire process is a conscientious scrutiny of applicable guidelines in the context 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, “Any doubt concerning personnel being considered for national security eligibility will be resolved in favor of the national security.” In reaching this decision, I have drawn only those conclusions that are reasonable, logical, and based on the evidence contained in the record. I have not drawn inferences based on mere speculation or conjecture. Directive ¶ E3.1.14, requires the Government to 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, and has the ultimate burden of persuasion as to obtaining a favorable clearance 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 national security eligibility. 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 potential, rather than actual, risk of compromise of classified or sensitive information. Finally, as emphasized in Section 7 of Executive Order 10865, “Any determination under this order adverse to an applicant shall be a determination in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.” See also Executive Order 12968, Section 3.1(b) (listing multiple prerequisites for access to classified or sensitive information.) 3

Analysis SOR Paragraph 1 (Guideline F: Financial Considerations) The security concerns relating to the guideline for financial considerations are set out in AG ¶ 18, which reads in pertinent part: 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. The facts of this case establish the following disqualifying condition set forth in AG ¶ 19 to the allegation under Guideline F: (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. The burden therefore shifts to Applicant to mitigate security concerns under Guideline F. The guideline includes the following conditions in AG ¶ 20 that can mitigate security concerns arising from Applicant’s financial history: (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 current reliability, trustworthiness, or 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, or a death, divorce or separation, clear victimization by predatory lending practices, or identity theft), and the individual acted responsibly under the circumstances; (d) the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts; and (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. 4

The record evidence fails to establish AG ¶ 20(a), (b), (d), or (g) for the tax issues alleged as Applicant has not provided evidence that she filed tax returns for the six years alleged, nor has she provided any documentation regarding agreements with, or payments to, taxing authorities. Applicant’s documentation showing retention of a tax preparation service over 18 months ago does not constitute sufficient evidence to meet her burden to show compliance with tax laws and regulations. ISCR 22-02168 at 4 (App. Bd. Nov. 18, 2024). Of particular concern is Applicant’s failure to perform even a cursory evaluation of her tax situation from 2015 – 2025. Instead, she assumed her mother was handling it. This failure to exercise even basic due diligence to fulfill her legal obligation to file income tax returns does not demonstrate the high degree of judgment and reliability required for access to classified information. ISCR 98-0608 at 1 (App. Bd. June 27, 2000) As a result, there is insufficient evidence for a determination that Applicant’s financial problems have been resolved or will be resolved within a reasonable period. I am unable to find that she acted reasonably or responsibly under the circumstances or that she made a good faith effort to deal with her tax issues. Applicant’s financial issues are ongoing and continue to cast doubt on her current reliability, trustworthiness, and good judgment. None of the mitigating conditions are sufficiently applicable to mitigate the security concerns. Whole-Person Concept Under the whole-person concept, the administrative judge must evaluate an applicant’s eligibility for national security eligibility 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(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 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 national security 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 above whole-person factors and the potentially disqualifying and mitigating conditions in light of all pertinent facts and circumstances surrounding this case. I have also given the appropriate weight to Applicant’s statements in her Answer, Response, interrogatories, and to the defense investigator. Overall, however, the Guideline F issues in the record evidence leave me with questions and doubts as to Applicant’s suitability for national security eligibility and a security clearance. 5

Formal Findings Formal findings for or against Applicant on the allegations set forth in the SOR, as required by ¶ E3.1.25 of Enclosure 3 of the Directive, are: Paragraph 1, Guideline F: AGAINST APPLICANT Subparagraphs 1.a – 1.b: Against Applicant Conclusion In light of all of the circumstances presented by the record in this case, I conclude that it is not clearly consistent with the interests of national security to grant Applicant’s eligibility for a security clearance. Eligibility for access to classified information is denied. RICHARD A. CEFOLA Administrative Judge 6