DATE: April 8, 2003
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SSN: -----------
Applicant for Security Clearance
DECISION OF ADMINISTRATIVE JUDGE
JAMES A. YOUNG
APPEARANCES
FOR GOVERNMENT
Kathryn D. MacKinnon, Esq., Department Counsel
FOR APPLICANT
Pro Se
SYNOPSIS
Applicant, a 69-year-old clerk for a defense contractor, owes back taxes on real estate. Although he believed the city or country had seized the property, when he was confronted with the fact that he still owned the property and was responsible for delinquent taxes, he declined to resolve the debt. Applicant failed to demonstrate it is in the national interest to grant him a clearance. Clearance is denied.
STATEMENT OF THE CASE
Applicant, an employee of a defense contractor, applied for a security clearance. The Defense Office of Hearings and Appeals (DOHA), the federal agency tasked with determining an applicant's eligibility for access to classified information, declined to grant Applicant a clearance. In accordance with the applicable Executive Order (1) and Department of Defense Directive, (2) DOHA issued a Statement of Reasons (SOR) on 11 November 2002 detailing why a clearance was not granted and recommending Applicant's case be referred to an administrative judge to determine whether the clearance should be denied/revoked. In the SOR, DOHA alleged Applicant failed to meet the financial considerations (Guideline F) and personal conduct (Guideline E) personnel security guidelines.
Applicant answered the SOR in writing on 6 December 2002. The case was assigned to me on 24 January 2003. On 14 March 2003, I convened a hearing to consider whether it is clearly consistent with the national interest to grant Applicant's security clearance. The Government's case consisted of six exhibits. Applicant testified on his own behalf but did not submit any exhibits. A transcript (Tr.) of the proceeding was received on 25 March 2003
Upon returning to my office after the hearing, I found a small file on my desk concerning Applicant. The file consisted of a letter from the Chief, Personnel Clearance Division of the Defense Security Service, Defense Industrial Security Clearance Office (DISCO), dated 9 January 2003, a copy of a newspaper article, and a letter from Applicant's security officer, 10 February 2003. The letter from DISCO notified the facility security officer that Applicant's interim security clearance had been withdrawn. The newspaper article reported that an individual from the town in which Applicant resides, with the same name, aged 70 years, had been arrested with a woman for disorderly conduct and committing a lewd act in public on 12 January 2003. The security officer forwarded the article to DISCO, but advised that he had no authority to corroborate whether Applicant was the person arrested. As these materials were not presented at the hearing and Applicant has not had an opportunity to comment on them, I have not considered them in determining Applicant's security clearance worthiness.
FINDINGS OF FACT
Applicant is a 69-year-old clerk for a defense contractor. Ex. 1 at 1; Tr. 40. In 1986 he opened a building company that put up modular homes. Ex. 3 at 3; Tr. 15. As the result of a canceled contract, Applicant ended up owning a lot with a damaged house on it. Applicant's business eventually failed and he was forced into bankruptcy in 1991. Ex. 3 at 3. Applicant admits owing $7,613 on a county tax claim, over $4,900 for taxes to the city, and has a state tax lien against him for $922, all on the lot he garnered from the canceled contract. Ex. 6 at 2. Applicant failed to disclose these debts in response to question 38 on his security clearance application dated 2 July 1999. Question 38 asked if Applicant had been over 180 days delinquent on any debt in the previous seven years. Ex. 1 at 6.
POLICIES
"[N]o one has a 'right' to a security clearance." Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). As Commander in Chief, the President has "the authority to . . . control access to information bearing on national security and to determine whether an individual is sufficiently trustworthy to occupy a position . . . that will give that person access to such information." Id. at 527. The President has restricted eligibility for access to classified information to United States citizens "whose personal and professional history affirmatively indicates loyalty to the United States, strength of character, trustworthiness, honesty, reliability, discretion, and sound judgment, as well as freedom from conflicting allegiances and potential for coercion, and willingness and ability to abide by regulations governing the use, handling, and protection of classified information." Exec. Or. 12968, Access to Classified Information § 3.1(b) (Aug. 4, 1995). Eligibility for a security clearance is predicated upon the applicant meeting the security guidelines contained in the Directive.
An evaluation of whether the applicant meets the security guidelines includes consideration of the following factors: (1) the nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the conduct; (3) the frequency and recency of the conduct; (4) the individual's age and maturity at the time of the conduct; (5) the voluntariness of participation; (6) the presence or absence of rehabilitation and other 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. Directive ¶ E2.2.1. Security clearances are granted only when "it is clearly consistent with the national interest to do so." Exec. Or. 10865 § 2. See Exec. Or. 12968 § 3.1(b).
Initially, the Government must establish, by substantial evidence, that conditions exist in the personal or professional history of the applicant which disqualify, or may disqualify, the applicant from being eligible for access to classified information. See Egan, 484 U.S. at 531. All that is required is proof of facts and circumstances that indicate an applicant is at risk for mishandling classified information, or that an applicant does not demonstrate the high degree of judgment, reliability, or trustworthiness required of persons handling classified information. ISCR Case No. 00-0277, 2001 DOHA LEXIS 335 at **6-8 (App. Bd. May 9, 2001). Once the Government has established a prima facie case by substantial evidence, the burden shifts to the applicant to rebut, explain, extenuate, or mitigate the facts. See Directive ¶ E3.1.15. An applicant "has the ultimate burden of demonstrating that it is clearly consistent with the national interest to grant or continue his security clearance." ISCR Case No. 01-20700 at 3 (App. Bd. Dec. 19, 2002). "Any doubt as to whether access to classified information is clearly consistent with national security will be resolved in favor of the national security." Directive ¶ E2.2.2. "[S]ecurity clearance determinations should err, if they must, on the side of denials." Egan, 484 U.S. at 531. See Exec. Or. 12968 § 3.1(b).
CONCLUSIONS
Applicant requested the hearing because he believed his loyalty to the U.S. had been attacked by DOHA's refusal to give him a security clearance. Tr. 44-45. He is almost 70 years old, served seven years in the armed forces, and argues that he would never compromise national security. The decision to deny an individual a security clearance is in no sense a determination as to the loyalty of the applicant. Exec. Or. 10865 § 7. It is merely an indication that the applicant has not met the strict guidelines the President and the Secretary of Defense have established for issuing a clearance.
Financial Considerations-Guideline F
In the SOR, DOHA alleged under Guideline F that Applicant was indebted to a collection company for back taxes owed to the county and city, that a state tax lien had been levied against him, and that he had filed for bankruptcy in 1991.
An individual who is financially overextended is at risk of having to engage in illegal acts to generate funds. Directive ¶ E2.A6.1.1. The following applicable conditions could raise a security concern and may be disqualifying in this case:
(1) A history of not meeting financial obligations. Directive ¶ E2.A6.1. 2.1.
(2) Deceptive or illegal financial practices such as tax evasion. See Directive ¶ E2.A6.1.2.2.
(3) Inability or unwillingness to satisfy debts. Directive ¶ E2.A6.1.2.3.
The sole mitigating condition that is possibly applicable to this case is that the conditions that resulted in the behavior were largely beyond the person's control-the failure of his business. Directive ¶ E2.A6.1.3.3.
Through Applicant's admissions and the evidence presented at the hearing, the Government established by substantial evidence that Applicant has a history of not meeting his tax obligations and has been unwilling to satisfy his debts. It seems clear that Applicant's financial problems began with the failure of his business in 1991. As a result, he was forced to into bankruptcy with the resulting discharge of approximately $25,000 in debt. However, since then, Applicant appears to have managed his finances well. He pays his credit cards off each month, has assets of over $70,000, and has a positive monthly cash flow of at least $1,000 a month. But, the real estate tax debt remains, and Applicant appears willing to resolve that debt only on his own terms.
Applicant claims that in 1992, he paid the property tax, but told the tax assessor to take the property because he couldn't afford to keep paying the taxes on it. He insists the tax assessor said the city would probably do that, and he never heard from any of the taxing authorities until confronted with the tax delinquencies by the DSS agent. Tr. 10. He asserts he assumed the city took the land because he never heard from them again. The delinquent tax assessments are now in the hands of a collection agency. Applicant "figured" that if the collection agency sued him, he could force them to re-assess the property. He would then be willing to pay the difference between the value of the property and the amount he owes in taxes. Tr. 24. But, Applicant has no idea what the property is worth. Because of the cost, he declined to get the property privately appraised, and refuses to hire a lawyer to advise him on these matters until he is sued. Tr. 32-33, 38. He does not actually know whether he will be entitled or able to get a re-assessment of the property value.
An applicant has a right to contest the legitimacy of the debts he is alleged to have incurred. But, Applicant has not done so. He admits that since the city never seized his property, he still owns it and owes the taxes. Applicant also has right to contest the amount of the assessment and the amount of the debt. But, he has not done so before a tribunal authorized to decide these issues. He is unwilling to take any action unless and until the collection agency sues him. Applicant, not the creditor, has the duty to resolve the debts. Under the circumstances, Applicant's failure to make a good faith effort to resolve the debt mandates a finding against him.
DOHA alleges Applicant's 1991 bankruptcy as a security concern. Applicant successfully mitigated that concern by establishing that the bankruptcy was caused by matters beyond his control-the failure of his company. Since that time, Applicant has been able to live free of debt with the exception of the real estate taxes which he did not know he owed. Therefore, I find for Applicant on ¶ 1.e of the SOR.
Personal Conduct-Guideline E
In the SOR, DOHA alleged under Guideline E that Applicant falsified material facts on his security clearance application by denying that he had any debts in the past seven years that were over 180 days' delinquent.
Under Guideline E, conduct involving questionable judgment, untrustworthiness, unreliability, lack of candor, dishonesty, or unwillingness to comply with rules and regulations could indicate that the person may not properly safeguard classified information. Directive ¶ E2.A5.l.l. The following applicable conditions could raise a security concern and could be disqualifying in this case:
The deliberate omission, concealment, or falsification of relevant and material facts from any personnel security questionnaire, personal history statement, or similar form used to conduct investigations, determine employment qualifications, award benefits or status, determine security clearance eligibility or trustworthiness, or award fiduciary responsibilities. Directive ¶ E2.A5.1.2.2. None of the mitigating conditions listed under Guideline E appear to apply to this case.
The evidence of record establishes that Applicant was unaware of the delinquencies on his real estate taxes when he completed the security clearance application. Therefore, he did not deliberately omit, conceal, or falsify these debts. Finding is for Applicant.
FORMAL FINDINGS
Conclusions as to each of the allegations in the SOR as required by Executive Order No. 10865 § 3, ¶ 7 and the Directive ¶ E3.1.25, are as follows:
Paragraph 1. Guideline G: AGAINST APPLICANT
Subparagraph 1.a.: Against Applicant
Subparagraph 1.b.: Against Applicant
Subparagraph 1.c.: Against Applicant
Subparagraph 1.d.: Against Applicant
Subparagraph 1.e.: For Applicant
Paragraph 2. Guideline E: FOR APPLICANT
Subparagraph 2.a.: For Applicant
DECISION
In light of all of the circumstances presented by the record in this case, it is not clearly consistent with the national interest to grant or continue a security clearance for Applicant.
James A. Young
Administrative Judge
1. Exec. Or. 10865, Safeguarding Classified Information Within Industry (Feb. 20, 1960), as amended and modified.
2. Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (Jan. 2, 1992), as amended and modified.