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ISCR Case 14-01255.a1 — CASE

ISCR Case 14-01255.a1denied

Case Headnote

ISCR Case No. 14-01255.a1

deniedJan 7, 2015· Hon. Michael Y. Ra'anan· appeal

Summary

A defense contractor's trustworthiness designation was denied due to concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The primary issues stemmed from unresolved financial problems, including a Chapter 7 bankruptcy and multiple past-due accounts.

The judge determined that the applicant's minimal debt payments did not constitute a good-faith effort to resolve her financial difficulties. Furthermore, her stated plan to file for a second bankruptcy was not viewed as a good-faith attempt to address her outstanding debts.

While Disqualifying Conditions AG ¶ 20(a) and AG ¶ 20(c) were raised, Mitigating Conditions AG ¶ 20(d) and AG ¶ 20(e) were applied. However, these were insufficient to overcome the concerns regarding the applicant's financial conduct, leading to the denial of her security clearance.

Why the Applicant Was Denied

The applicant's debt payments were minimal and did not demonstrate a good-faith effort to resolve her financial problems.
The applicant's plan to file for a second bankruptcy was not considered a good-faith effort to address her debts.

Conditions Referenced

Disqualifying

AG ¶ 20(a)raisedInability or Unwillingness to Satisfy Debts
AG ¶ 20(c)raisedA History of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(d)rejectedThe Conditions That Resulted in the Financial Problems Were Largely Beyond the Person's ControlThe judge found that the applicant's financial issues were not sufficiently mitigated.
AG ¶ 20(e)rejectedThe Person Has Made a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe judge concluded that the applicant's payments were token and did not reflect a good-faith effort.

Key Rule Quoted

“such a determination 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)

Procedural Posture

SOR issuedJun 5, 2014
Answer filed—
Hearing heldSep 17, 2014
Decision dateJan 7, 2015

Cite For

Denial of Trustworthiness Designation Due to Unresolved Financial Issues Under Guideline F
Insufficient Evidence of Good-faith Effort to Resolve Debts
Impact of Financial Irresponsibility on Trustworthiness Determinations

Editorial summary generated for research. Not legal advice; not a prediction. Verify against the full decision before relying on any quoted language.

Full decision

The complete, official text — footnotes and signatures included — is in the original PDF.

Decision text, by section

DEFENSE OFFICE OF HEARINGS AND APPEALS

APPEAL

SYNOPSIS

KEYWORD: Guideline F; Guideline E DIGEST: The Judge addressed Applicant’s debt payments, but his conclusion that they were minimal, with little impact on her overall debt situation, was consistent with the record that was before him. Adverse decision affirmed. CASENO: 14-01255.a1 DATE: 01/07/2015 DATE: January 7, 2015 In Re: ------------------------------- Applicant for Position of Trust ) ) ) ) ) ) ) ) ADP Case No. 14-01255

APPEAL BOARD DECISION

APPEARANCES

FOR GOVERNMENT James B. Norman, Esq., Chief Department Counsel FOR APPLICANT Pro se The Department of Defense (DoD) declined to grant Applicant a trustworthiness designation. On June 5, 2014, DoD issued a statement of reasons (SOR) advising Applicant of the basis for that decision–trustworthiness concerns raised under Guideline F (Financial Considerations) and Guideline E (Personal Conduct) of Department of Defense Directive 5220.6 (Jan. 2, 1992, as amended) (Directive). Applicant requested a hearing. On September 17, 2014, after the hearing, Defense Office of Hearings and Appeals (DOHA) Administrative Judge Michael H. Leonard denied Applicant’s request for a trustworthiness designation. Applicant appealed pursuant to Directive ¶¶ E3.1.28 and E3.1.30. Applicant raised the following issue on appeal: whether the Judge’s adverse decision was arbitrary, capricious, or contrary to law. The Judge’s favorable findings under Guideline E are not at issue in this appeal. Consistent with the following, we affirm. The Judge’s Findings of Fact Applicant is seeking a trustworthiness designation pertinent to her job as a Defense contractor, a position she has held since late 2013. She shares living expenses with a boyfriend. Aside from about $200 in cash, she has no assets. Applicant’s employment history consists of several different jobs and three periods of unemployment. One such period of unemployment occurred from June to October 2013, when she left her job to care for her mother. Another was when she left a job to relocate and yet another when she had a baby. Applicant has a history of financial problems. This history includes a discharge in Chapter 7 bankruptcy; seven medical accounts; seven other past due accounts, including a vehicle repossession; and two collection accounts. Her bankruptcy “resulted from her youth and inexperience,” in that she took on more debt than she could repay. Decision at 3. She has been in contact with creditors and has made small payments to a number of them in recent months. She intends to keep making small payments until she is able to file a second bankruptcy petition. The Judge’s Analysis The Judge resolved the Guideline E allegation in Applicant’s favor. Regarding the allegations under Guideline F, he concluded that the seven medical debts did not raise security concerns. However, he found that Applicant’s remaining debts did raise concerns, ones that she had failed to mitigate. He stated that she had done little to resolve these debts, making “what are essentially token payments that have no material impact on debt reduction.” Id. at 4. He stated that her plan to file for a second bankruptcy, while legal, does not qualify as a good-faith effort to resolve her problems. He concluded that Applicant had not demonstrated a plan for debt resolution.

DISCUSSION

Applicant cites to her evidence of debt repayment and good job performance. Applicant’s brief is not sufficient to rebut the presumption that the Judge considered all of the evidence in the record. Neither is it sufficient to show that the Judge failed properly to weigh the evidence. See, e.g., ADP Case No. 14-00700 at 2 (App. Bd. Sep. 24, 2014). The Judge addressed Applicant’s payments, but his conclusion that they were minimal, with little impact on her overall debt situation, was consistent with the record that was before him. Failure to satisfy delinquent debts may indicate a lack of judgment, “which can raise questions about an individual’s . . . ability to protect” sensitive information. Directive, Enclosure 2 ¶ 18. Applicant states that the Judge’s adverse decision has resulted in the loss of her job, thereby working a substantial hardship on her. We are not able to consider the effect that an unfavorable trustworthiness determination might have on an Applicant’s employment. See, e.g., ADP Case No. 08-07290 at 3 (App. Bd. Nov. 17, 2009). The Judge examined the relevant data and articulated a satisfactory explanation for the decision. The decision is sustainable on this record. The standard applicable to trustworthiness cases is that set forth in Department of the Navy v. Egan, 484 U.S. 518, 528 (1988) regarding security clearances: such a determination “may be granted only when ‘clearly consistent with the interests of the national security.’” See, e.g., ADP Case No. 12-04343 at 3 (App. Bd. May 21, 2013). See also Kaplan v. Conyers, 733 F.3d 1148 (Fed. Cir. 2013), cert. denied.

ORDER

The Decision is AFFIRMED. Signed: Michael Ra’anan Michael Ra’anan Administrative Judge Chairperson, Appeal Board Signed: William S. Fields William S. Fields Administrative Judge Member, Appeal Board Signed: James E. Moody James E. Moody Administrative Judge Member, Appeal Board