PSH-21-0066

*The original of this document contains information which is subject to withholding from disclosure
under 5 U.S. C. § 552. Such material has been deleted from this copy and replaced with XXXXXX’s.
United States Department of Energy
Office of Hearings and Appeals
In the Matter of: Personnel Security Hearing )
)
Filing Date: May 21, 2021 ) Case No.: PSH-21-0066
)
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Issued: December 29, 2021
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Administrative Judge Decision
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Katie Quintana, Administrative Judge:
This Decision concerns the eligibility of XXXXXXXXXXXX (hereinafter referred to as “the
Individual”) to hold an access authorization1 under the Department of Energy’s (DOE) regulations
set forth at 10 C.F.R. Part 710, Subpart A, entitled “General Criteria and Procedures for
Determining Eligibility for Access to Classified Matter or Special Nuclear Material.” As discussed
below, after carefully considering the record before me in light of the relevant regulations and the
National Security Adjudicative Guidelines for Determining Eligibility for Access to Classified
Information or Eligibility to Hold a Sensitive Position (June 8, 2017) (Adjudicative Guidelines), I
conclude that the Individual’s access authorization should be restored.
I. Background
The Individual is employed by a DOE contractor in a position that requires her to hold a security
clearance. In 2020, as part of a reinvestigation for her security clearance, the DOE learned that the
Individual failed to file her 2019 Federal and state taxes before the April 15th tax deadline. Ex. 4.
In September 2020, the Individual completed a Letter of Interrogatory (LOI), in which she stated
that she was “working on” her 2019 taxes. Ex. 5. In December 2020, the LSO informed the
Individual, in a Notification Letter, that it possessed reliable information that created substantial
doubt regarding her eligibility to hold a security clearance. In an attachment to the Notification
Letter, the LSO explained that the derogatory information raised security concerns under Guideline
F (Financial Considerations). Ex. 1.
Upon receipt of the Notification Letter, the Individual exercised her right under the Part 710
regulations by requesting an administrative review hearing. Ex. 2. The Director of the Office of
Hearings and Appeals (OHA) appointed me as the Administrative Judge in the case, and I
subsequently conducted an administrative hearing in the matter. At the hearing, the DOE Counsel
1 Access authorization is defined as “an administrative determination that an individual is eligible for access to
classified matter or is eligible for access to, or control over, special nuclear material.” 10 C.F.R. § 710.5(a). Such
authorization will be referred to variously in this Decision as access authorization or security clearance.
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submitted six numbered exhibits (Exhibits 1-6) into the record. The Individual tendered 12 exhibits
(Exhibits A-L) and testified on her own behalf. The exhibits will be cited in this Decision as “Ex.”
followed by the appropriate alphabetical or numeric designation. The hearing transcript in the case
will be cited as “Tr.” followed by the relevant page number.
II. Regulatory Standard
A DOE administrative review proceeding under Part 710 requires me, as the Administrative Judge,
to issue a Decision that reflects my comprehensive, common-sense judgment, made after
consideration of all the relevant evidence, favorable and unfavorable, as to whether the granting or
continuation of a person’s access authorization will not endanger the common defense and security
and is clearly consistent with the national interest. 10 C.F.R. § 710.7(a). The regulatory standard
implies that there is a presumption against granting or restoring a security clearance.
See Department of Navy v. Egan, 484 U.S. 518, 531 (1988) (“clearly consistent with the national
interest” standard for granting security clearances indicates “that security determinations should
err, if they must, on the side of denials”); Dorfmont v. Brown, 913 F.2d 1399, 1403 (9th Cir. 1990)
(strong presumption against the issuance of a security clearance).
The Individual must come forward at the hearing with evidence to convince the DOE that granting
or restoring access authorization “will not endanger the common defense and security and will be
clearly consistent with the national interest.” 10 C.F.R. § 710.27(d). The Individual is afforded a
full opportunity to present evidence supporting her eligibility for an access authorization. The
Part 710 regulations are drafted to permit the introduction of a very broad range of evidence at
personnel security hearings. Even appropriate hearsay evidence may be admitted. 10 C.F.R.
§ 710.26(h). Hence, an individual is afforded the utmost latitude in the presentation of evidence to
mitigate the security concerns at issue.
III. Notification Letter and Associated Concerns
As previously mentioned, the Notification Letter included a statement of derogatory information
that raised concerns about the Individual’s eligibility for access authorization. The information in
the letter specifically cited Guideline F of the Adjudicative Guidelines. Guideline F addresses one’s
“[f]ailure to live within one's means, satisfy debts, and meet financial obligations.” Guideline F
at ¶ 18. It is well established that failure or inability 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 information. Id. Among the conditions set forth in
this guideline that could raise a disqualifying security concern is the failure to file Federal or state
income tax returns. Id. at ¶ 19(f). In citing Guideline F, the LSO relied upon the Individual’s
admission in the LOI that she had not filed her Federal or state income taxes for the 2019 tax year.
Ex. 1
IV. Findings of Fact
I have carefully considered the totality of the record in reaching the findings of fact set forth below.
At the hearing, the Individual testified on her own behalf and presented the testimony of her
supervisor, a previous work colleague, and two associates with whom she interacts through her
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work in a non-profit organization. The Individual’s supervisor and her colleague both testified that
the Individual is reliable, demonstrates sound judgment, and is trustworthy. Tr. at 13-14, 22-23.
The first associate (Associate 1) testified that he has known the Individual for 16 years through
their work in the non-profit organization (Organization). Id. at 28. He stated that the Individual has
served with him on the Board of Directors, which is responsible for financial allocations of the
Organization. Id. at 31. Associate 1 explained that the Individual is highly involved in the
Organization’s charitable work and is responsible for managing and distributing financial
donations. Id. at 31-32. He noted that the Individual has always been responsible and trustworthy
regarding the management and distribution of the contributions. Id. at 32. Associate 1 stated that
he “trust[s the Individual] implicitly” and has never observed any defects in her judgment. Id. at
33. He further added that she has never violated any of the Organization’s rules or regulations and
is careful to ensure that the Board of Directors is compliant with all relevant rules and regulations,
including state statutory law. Id. at 34, 36.
The Individual’s second associate (Associate 2) testified that he has known her through the
Organization for approximately six years. Id. at 42. He stated that he served as a trustee of the
Organization with the Individual, and they were responsible for managing the Organization’s
financial affairs and orchestrating fundraising efforts. Id. Associate 2 noted that he “never had any
issue with [the Individual] exercising her fiduciary responsibilities to the organization,” and he felt
that she demonstrated “sound and effective judgment.” Id. at 43-44. Associate 2 added that the
Individual has “always been cognizant” of the Organization’s policies and regulations and corrects
others who are not abiding by them. Id. at 45. He affirmed that the Individual is both reliable and
trustworthy. Id. at 46.
The Individual testified that she filed her 2019 Federal and state income taxes on October 20, 2020.
Id. at 54, see Ex. A-B, K-L. She explained that she filed her 2019 taxes beyond the April 15th
deadline because she was waiting to receive financial information from an investment firm that had
recently acquired her previous investment firm. Id. at 73. The Individual stated that she has always
prepared her own taxes and, apart from one tax year, she has always received a tax refund. Id. at
56. She testified that she believed that if a taxpayer was due a refund, the taxpayer was not required
to file taxes by the April 15th deadline. Tr. at 56, 82, 85. Therefore, because she was expecting a
refund for the 2019 tax year, she did not file her taxes by the April 15th deadline. See id. at 55-56.
The Individual clarified that she has never failed to file her taxes, and although her 2019 taxes were
filed late, she always intended to file them and thought that she was complying with all tax laws
because she was due a refund. Id. at 67, 69.
The Individual testified that, in November 2020, she completed an online tax preparation course,
and now knows that she was operating under a mistaken assumption regarding the late filing of her
2019 taxes. Id. at 57, see Ex. C. She stated that, through the course, she also learned about filing
amendments to a tax return and filing for an extension from the appropriate tax authority. Tr. at 92-
93. She added that she will take these steps in the future if she does not have all her financial
information prior to the April 15th deadline. Id. The Individual further testified that, to avoid future
tax problems, she has stopped preparing her own taxes and has hired a professional tax preparation
service, which she intends to continue to use for all future tax years. Id. at 57. She additionally
affirmed that this tax preparation service prepared and filed her 2020 taxes before the April 15th
deadline. Id. at 57-58, Ex. H-I.
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V. Analysis
I have thoroughly considered the record of this proceeding, including the submissions tendered in
this case and the testimony presented at the hearing. In resolving the question of the Individual’s
eligibility for access authorization, I have been guided by the applicable factors prescribed in
10 C.F.R. § 710.7(c) and the Adjudicative Guidelines. After due deliberation, I have determined
that the Individual has sufficiently mitigated the security concerns noted by the LSO regarding
Guideline F. I find that restoring the Individual’s DOE security clearance will not endanger the
common defense and security, and is clearly consistent with the national interest. 10 C.F.R.
§ 710.27(a). Therefore, I have determined that the Individual’s security clearance should be
restored. The specific findings that I make in support of this decision are discussed below.
As discussed above, failure to meet financial obligations, including the failure to file annual Federal
or State income tax returns as required, can raise security concerns regarding an individual’s
trustworthiness and reliability. Guideline F at ¶¶ 18, 19(f). An individual may be able to mitigate
the security concerns by demonstrating that 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. Id. at ¶ 20(a). Additionally, an
individual may be able to mitigate the security concerns if she is receiving financial counseling or
has made arrangements with the appropriate tax authorities to file the taxes and is in compliance
with that arrangement. See id. at ¶ 20(c), (g).
In this case, the Individual successfully filed her 2019 Federal and state tax returns in October
2020. See id. at ¶ 20(g). At the outset, I note that the Individual’s explanation that she did not know
she was required to file her taxes by the April 15th deadline if she was expecting a refund is not a
legitimate excuse. However, although the Individual’s taxes were filed late, as soon as she became
aware that she was not in compliance with the tax law, she promptly took action to file her taxes.
Further, the Individual recognized that she was not sufficiently knowledgeable regarding tax law,
and she has ensured that she will not encounter similar tax problems in the future by completing a
tax course and employing the services of a professional tax preparation company. Id. at ¶ 20(c).
For the foregoing reasons, I find that the Individual has mitigated the DOE’s security concerns
under Guideline F.
VI. Conclusion
After considering all of the relevant information, favorable and unfavorable, in a comprehensive,
common-sense manner, including weighing all of the testimony and other evidence presented at
the hearing, I have found that the Individual has brought forth sufficient evidence to resolve the
security concerns associated with Guideline F. Accordingly, the Individual has demonstrated that
restoring her security clearance would not endanger the common defense and would be clearly
consistent with the national interest. Therefore, I have determined that the Individual’s access
authorization should be restored. The parties may seek review of this Decision by an Appeal Panel
under the regulations set forth at 10 C.F.R. § 710.28.
Katie Quintana
Administrative Judge
Office of Hearings and Appeals