KEYWORD: Guideline E; Guideline F
DIGEST: Applicant violated a trust by misappropriating funds from an employee golf
association.  Adverse decision affirmed
CASENO: 11-00110.a1
DATE: 01/26/2012
DATE: January 26, 2012
In Re:
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Applicant for Security Clearance
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ISCR Case No. 11-00110
APPEAL BOARD DECISION
APPEARANCES
FOR GOVERNMENT
James B. Norman, Esq., Chief Department Counsel
FOR APPLICANT
Gary L. Rigney, Esq.
The Defense Office of Hearings and Appeals (DOHA) declined to grant Applicant a security
clearance.  On April 8, 2011, DOHA issued a statement of reasons (SOR) advising Applicant of the
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basis for that decision—security concerns raised under Guideline E (Personal Conduct) and
Guideline F (Financial Considerations) of Department of Defense Directive 5220.6 (Jan. 2, 1992,
as amended) (Directive).  Department Counsel requested a hearing.  On November 4, 2011, after the
hearing, Administrative Judge James F. Duffy denied Applicant’s request for a security clearance.
Applicant timely appealed pursuant to the Directive ¶¶ E3.1.28 and E3.1.30.
Applicant raises the following issue on appeal: whether the Judge’s adverse security
clearance decision is arbitrary, capricious, and contrary to law.  For the following reasons, the Board
affirms the Judge’s unfavorable decision.
The Judge made the following findings of fact:  Applicant is 54 years old and served in the
military from 1976 to 1996.  He is not currently married, and has been divorced three times.  The
Judge summarized Applicant’s testimony as follows:  In 1997 he began working for a private
company.  In 2005 he was asked to serve as the treasurer of that company’s employees golf
association, wherein he would have complete control of the monies flowing in and out of the
association account.  The company partially funded the golf association.  The bank where the
association established the account had a $10,000 cap, wherein deposited amounts in excess of that
figure were subject to charges and fees.  In 2006,  Applicant began transferring golf association
funds into his personal checking account, purportedly to avoid the fees and charges.  During that
year, Applicant transferred $11,975 from the golf association’s account into his own account.  He
did not keep the association money separate from his own, and began making withdrawals involving
golf association monies that he had transferred from the association account.   Also in 2007,
Applicant was involved in a divorce.  He had a joint checking account that he maintained with his
ex-wife.  His ex-wife made withdrawals from the joint checking account that involved golf
association assets.  At one point, Applicant returned from a business trip to learn that checks written
on the association’s account were beginning to bounce.
As a result of the bounced checks, the board of directors of the golf association looked into
the matter.  It was determined that approximately $12,000 was missing from the account.  Applicant
was given a month to repay the missing funds.  He repaid $8,800 within that time period.  The board
of directors asked him to resign as treasurer, which he did in September or October of 2007.  
Applicant’s company was informed of the missing funds, and conducted its own
investigation.  The investigation revealed that there was only one bank fee that applied to the
$10,000 cap.  During 2006 and 2007, Applicant transferred $11,975 from the golf association’s
account into his own account.  The investigation revealed that none of the golf club’s officers knew
that Applicant was transferring money from the golf association account to his own personal
account.  This finding is at odds with Applicant’s testimony that, in about 2006, he informed the
president of the golf association that he was placing some of the association’s funds in his personal
account to avoid the $10,000 cap fee, and that the president gave him permission to do so.  In early
2008, Applicant was terminated from his company for theft.  At the time of his termination, the
company’s records reflected that Applicant still owed $3,175 to the golf association account.
Applicant claims that all the money that belonged to the golf association has been repaid, but
provided no documents to prove he made those payments.
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The Judge reached the following conclusions: As treasurer of his company’s employees golf
association, Applicant was entrusted with golf association funds.  He violated that trust by
depositing golf association funds in his personal accounts and using those funds for personal
purposes.  The company’s investigation does not support Applicant’s contention that he transferred
golf association funds into his account merely to avoid the $10,000 cap fees.  Applicant knowingly
and intentionally misappropriated golf association funds for his personal purposes even though he
may have intended to repay that money eventually. By engaging in that conduct, he breached his
fiduciary duty.  His misappropriation was not an isolated event, but occurred over a number of
months.  Although he was going through a divorce and experiencing financial difficulties when he
misappropriated the funds, such circumstances do not mitigate his conduct.  This was a serious
breach of trust that casts doubt on his reliability, trustworthiness, and good judgment.  The variance
between Applicant’s testimony and the investigation findings show that he has failed to accept full
responsibility for his misconduct, which raises questions about his reform and rehabilitation.
Although his misconduct occurred over four years ago, sufficient time has not passed to conclude
his misconduct is unlikely to recur in the future.  Applicant is meeting his current financial
obligations.  Here, the financial concern does not arise from delinquent debts, but arises from a
breach of financial trust.  For the reasons set forth in the discussion under Guideline E, Applicant
has also failed to mitigate the security concerns under Guideline F.  In spite of his honorable military
record and current outstanding job performance, Applicant’s misappropriation of funds entrusted
to him raises significant security concerns that leave questions and doubts about his eligibility and
suitability for a security clearance.  
   Applicant argues that the Judge failed to recognize the appropriate mitigating factors or
to conduct a proper whole person analysis and the findings and conclusions regarding the
Applicant’s current judgment and trustworthiness cannot be sustained on the basis of the record
evidence as a whole.  More specifically, he asserts that his conduct was an isolated instance resulting
from financial problems occasioned by marital difficulties, the Judge’s conclusion that Applicant
has not accepted full responsibility for his actions is erroneous, and the misconduct is outweighed
by over twenty years of responsible conduct without incident.  Applicant has failed to establish error
on the part of the Judge. 
Applicant included an exhibit with his appeal brief.  In addition to his prayer that the Judge’s
decision be reversed, Applicant requests alternative relief in the form of a remand to permit the
introduction of the exhibit for consideration by the Judge.  The case history reveals that Applicant,
although pro se, was given significant additional time after the hearing to submit additional evidence
pertaining to the precise issue that is covered by the exhibit proffered on appeal.  Although pro se
applicants cannot be expected to act like lawyers, they are expected to take timely, reasonable steps
to protect their rights under the Directive.  See, e.g., ISCR Case No. 07-15235 at 2 (App. Bd. Oct.
3, 2008).  Applicant’s failure to take the necessary steps to supplement the record within the time
frame agreed upon by him, Department Counsel, and the Judge, does not constitute a denial of
procedural due process and does not justify remand for the purpose of expanding the record.    
 Applicant’s other appeal contentions do little more than argue for a particular interpretation
of the record evidence.  As the trier of fact, the Judge has to weigh the evidence as a whole and
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decide whether the favorable evidence outweighs the unfavorable evidence, or vice versa.  See, e.g.,
ISCR Case No. 06-10320 at 2 (App. Bd. Nov. 7, 2007).  A party’s disagreement with the Judge’s
weighing of the evidence, or an ability to argue for a different interpretation of the evidence, is not
sufficient to demonstrate the Judge weighed the evidence or reached conclusions in a manner that
is arbitrary, capricious, or contrary to law.  See, e.g., ISCR Case No. 06-17409 at 3 (App. Bd. Oct.
12, 2007).  
In this case, the Judge weighed the mitigating evidence offered by Applicant against the
seriousness of the disqualifying conduct and considered the possible application of relevant
conditions and factors.  He adequately discussed why the disqualifying conduct established under
Guidelines E and F was not mitigated.  The Judge discussed in some detail his conclusions that
Applicant’s conduct was not isolated, and that Applicant had not accepted full responsibility for his
misconduct.  The Judge’s analysis is reasonably supported by the record.
The Board does not review a case de novo.  The favorable evidence cited by Applicant is not
sufficient to demonstrate the Judge’s decision is arbitrary, capricious, or contrary to law.  See, e.g.,
ISCR Case No. 06-11172 at 3 (App. Bd. Sep. 4, 2007).  After reviewing the record, the Board
concludes that the Judge examined the relevant data and articulated a satisfactory explanation for
his decision, “including a ‘rational connection between the facts found and the choice made.’” Motor
Vehicle Mfrs. Ass’n of the United States v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)
(quoting Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168 (1962)).  “The general
standard is that a clearance may be granted only when ‘clearly consistent with the interests of the
national security.’” Department of the Navy v. Egan, 484 U.S. 518, 528 (1988).  Therefore, the
Judge’s ultimate unfavorable security clearance decision is sustainable.
Order
The decision of the Judge denying Applicant a security clearance is AFFIRMED.
Signed: Michael Y. Ra’anan   
Michael Y. Ra’anan
Administrative Judge
Chairperson, Appeal Board
Signed: Jeffrey D. Billett            
Jeffrey D. Billett
Administrative Judge
Member, Appeal Board
Signed: James E. Moody               
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James E. Moody
Administrative Judge
Member, Appeal Board