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The Nuclear Regulatory Commission (NRC) requested a decision as to whether an employee may be reimbursed expenses incurred incident to his successful appeal of a denial of a security clearance. The NRC offered employment to an individual contingent upon his receiving a security clearance. After a background investigation, a voluntary psychiatric examination, and an interview, NRC advised the individual that it was doubtful that he would be granted a security clearance. He requested a hearing before the NRC Personnel Security Board which recommended that the security clearance be denied. A subsequent appeal to the Board overturned the prior recommendation, and the security clearance was granted. Previously GAO has held that the Government is authorized to provide payment of attorneys fees when the interest of the United States is at stake along with an employee's personal interest, where he would be defending conduct within the scope of his employment against charges by an outside party. That authority does not extend to this case where the agency allowed the individual the opportunity for a hearing and further appeal. The individual in this case was not defending conduct within the scope of his work, and it was not in the interest of the Government to provide the applicant with legal counsel. GAO found no basis upon which the NRC could allow reimbursement of legal and psychiatric fees.

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