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ISCR Case 18-01211 — CASE

ISCR Case 18-01211granted

Case Headnote

ISCR Case No. 18-01211

grantedMar 7, 2019· Hon. Richard A. Cefola· hearing

Summary

A 58-year-old independent contractor for the State Department was granted a security clearance despite initial concerns under Guideline F, Financial Considerations. The applicant faced allegations of past-due debts, including an automobile loan, a $2,962 debt to Creditor B, thirteen debts totaling approximately $9,035 managed through a debt consolidation service, and a $494 debt to Creditor E. These issues raised disqualifying conditions under Adjudicative Guidelines Paragraphs 19(a) and 19(c).

However, the applicant demonstrated substantial mitigating efforts. She settled her automobile loan with Creditor A and her debt with Creditor E for $494. She also established monthly payments of $83 to Creditor B and $250 towards her thirteen consolidated debts. These actions, supported by documentation from the creditors, satisfied mitigating conditions under Adjudicative Guidelines Paragraphs 20(b) and 20(d).

The decision to grant the clearance was based on the applicant's good-faith efforts to resolve her financial difficulties, including settling significant debts and making regular payments on remaining obligations. Furthermore, her financial issues were attributed to circumstances beyond her control, specifically her husband's health problems.

Why the Applicant Prevailed

The applicant settled significant debts and is making regular payments on remaining obligations.
The applicant's financial issues were attributed to circumstances beyond her control, including her husband's health problems.
The applicant provided evidence of good-faith efforts to resolve her financial difficulties.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability to Satisfy Debts
AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(b)appliedConditions Largely Beyond the Person's Control
AG ¶ 20(d)appliedGood-faith Effort to Repay Overdue Creditors

Key Rule Quoted

“The protection of the national security is the paramount consideration.”

Procedural Posture

SOR issuedMay 18, 2018
Answer filedOct 9, 2018
Hearing heldDec 3, 2018
Decision dateMar 7, 2019

Cite For

Mitigation of Financial Difficulties Under Guideline F
Consideration of Circumstances Beyond Control in Financial Cases
Good-faith Efforts to Resolve Debts as a Mitigating Factor

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

Standardized Decision Profile

SEAD-4 Guideline F · descriptive summary of a decided case

Posture: HearingDecided: granted

The judge found that the applicant had settled her automobile loan and was making monthly payments on other past-due debts, demonstrating a commitment to resolving her financial issues. The applicant's financial difficulties were attributed to intermittent employment and her husband's health issues, which the judge found mitigated the financial concerns.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant has 'settled' her automobile loan with Creditor A, as evidenced by documentation from Creditor A. $20,000	For Applicant	Auto Loan Debt	Admitted	—	—	—
1.b	Applicant is making monthly payments of $83 towards an admitted $2,962 past-due debt to the satisfaction of Creditor B, as evidenced by documentation from Creditor B. $2,962	For Applicant	Unspecified Financial	Admitted	—	—	—
1.c	Applicant is making monthly payments of $250 towards thirteen admitted past-due debts totaling about $9,035 through a debt consolidation service. $9,035	For Applicant	Unspecified Financial	Admitted	—	—	—
1.e	Applicant has settled her admitted past-due debt to Creditor E for $494, as evidenced by documentation from Creditor E. $494	For Applicant	Unspecified Financial	Admitted	—	—	—
1.d–1.p	12 sub-charges — specific text not stated in this decision (for the applicant).	For Applicant			—	—	—

Descriptive standardized rendering of a decided public case (Guideline F). The verbatim source decision is shown in full below.

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

HEARING

APPEARANCES

DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS

In the matter of: )

)

ISCR Case No. 18-01211

)

) Applicant for Security Clearance )

For Government: Tara Karoian, Esq., Department Counsel For Applicant: Pro se

March 7, 2019 ______________

STATEMENT OF CASE

______________

CEFOLA, Richard A., Administrative Judge:

Statement of the Case

On May 18, 2018, in accordance with DoD Directive 5220.6, as amended (Directive), the Department of Defense issued Applicant a Statement of Reasons (SOR) alleging facts that raise security concerns under Guideline F. The SOR further informed Applicant that, based on information available to the government, DoD adjudicators could not make the preliminary affirmative finding it is clearly consistent with the national interest to grant or continue Applicant’s security clearance.

Applicant answered the SOR on October 9, 2018, and requested a hearing before an administrative judge. (Answer.) The case was assigned to me on November 6, 2018. The Defense Office of Hearings and Appeals (DOHA) issued a notice of hearing on November 14, 2018, scheduling the hearing for December 3, 2018. The hearing was convened as scheduled. The Government offered Exhibits (GXs) 1 through 6, which were admitted into evidence. Applicant testified on her own behalf. Applicant presented one document, which I marked Applicant’s Exhibit (AppX) A, and admitted into evidence. The record was left open until February 3, 2019, for receipt of additional

documentation. In a timely fashion, Applicant offered four additional packets of documents, which were also admitted into evidence, as AppXs B~E. DOHA received the transcript of the hearing (TR) on December 11, 2018.

FINDINGS OF FACT

Applicant admitted to all the allegations in SOR. After a thorough and careful review of the pleadings, exhibits, and testimony, I make the following findings of fact.

Applicant is a 58-year-old “independent contractor for [the] State Department.” (TR at page 15 line 10 to page 16 line 5, and GX 1 at page 5.) She has been employed as an independent contractor since September of 2014. (GX 1 at page 14.) She is married, and has two adult children. (TR at page 16 line 16 to page 19 line 10.) Applicant attributes her financial difficulties to her intermittent employment, and to her husband’s poor health, due to heart attacks. (TR at page 26 line 12 to page 27 line 4.)

Guideline F - Financial Considerations

1.a. Applicant has “settled” her automobile loan with Creditor A, as evidenced by documentation from Creditor A. (TR at page 25 line 7 to page 26 line 14, at page 27 line 5 to page 29 line 23, and AppX B at page 9.) This $20,000 allegation constitutes the majority of Applicant’s alleged past-due indebtedness, and is found for Applicant.

1.b. Applicant is making monthly payments of $83 towards an admitted $2,962 past-due debt to the satisfaction of Creditor B, as evidenced by documentation from Creditor B. (AppX B at pages 10–13.) This allegation is found for Applicant.

1.c, 1.d., and 1.f~1.p Since July of 2018, through the auspices of a debt consolidation service, Applicant is making monthly payments of $250 towards these thirteen admitted past-due debts totaling about $9,035. (TR at page 19 line 15 to page 25 line 6, and at page 30 line 22 to page 32 line 5.) This is evidenced by documentation from her debt consolidation service. (AppX B at pages 1–7.) These allegations are found for Applicant.

1.e. Applicant has settled her admitted past-due debt to Creditor E for $494, as evidenced by documentation from Creditor E. (AppX D.) This allegation is found for Applicant.

Applicant performs her job well, as evidenced by numerous letters of recommendation, citations and achievement awards. (AppX C.)

POLICIES

When evaluating an applicant’s national security eligibility, the administrative judge must consider the adjudicative guidelines (AG). In addition to brief introductory explanations for each guideline, the adjudicative guidelines list potentially disqualifying conditions and mitigating conditions, which are to be used in evaluating an applicant’s national security eligibility.

These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, administrative judges apply the guidelines in conjunction with the factors listed in AG ¶ 2 describing the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. According to AG ¶ 2(a), the entire process is a conscientious scrutiny of a number of variables known as the whole-person concept. The administrative judge must consider all available, reliable information about the person, past and present, favorable and unfavorable, in making a decision.

The protection of the national security is the paramount consideration. AG ¶ 2(b) requires that “[a]ny doubt concerning personnel being considered for national security eligibility will be resolved in favor of the national security.” In reaching this decision, I have drawn only those conclusions that are reasonable, logical, and based on the evidence contained in the record.

Under Directive ¶ E3.1.14, the Government must present evidence to establish controverted facts alleged in the SOR. Directive ¶ E3.1.15 states the “applicant is responsible for presenting witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by the applicant or proven by Department Counsel, and has the ultimate burden of persuasion as to obtaining a favorable clearance decision.”

A person who applies for access to classified information seeks to enter into a fiduciary relationship with the Government predicated upon trust and confidence. This relationship transcends normal duty hours and endures throughout off-duty hours. The Government reposes a high degree of trust and confidence in individuals to whom it grants access to classified information. Decisions include, by necessity, consideration of the possible risk the applicant may deliberately or inadvertently fail to protect or safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation as to potential, rather than actual, risk of compromise of classified information.

Section 7 of Executive Order (EO) 10865 provides that adverse decisions shall be “in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.” See also EO 12968, Section 3.1(b) (listing multiple prerequisites for access to classified or sensitive information).

ANALYSIS

Guideline F - Financial Considerations

The security concern relating to the guideline for Financial Considerations is set out in AG ¶ 18:

Failure 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 or sensitive information. Financial distress can also be caused or exacerbated by, and thus can be a possible indicator of, other issues of personnel security concern such as excessive gambling, mental health conditions, substance misuse, or alcohol abuse or dependence. An individual who is financially overextended is at greater risk of having to engage in illegal or otherwise questionable acts to generate funds. Affluence that cannot be explained by known sources of income is also a security concern insofar as it may result from criminal activity, including espionage.

The guideline notes several conditions that could raise security concerns under AG ¶ 19. Two are potentially applicable in this case:

(a) inability to satisfy debts; and

Applicant has admitted to significant past-due indebtedness. The evidence is sufficient to raise these disqualifying conditions.

AG ¶ 20 provides conditions that could mitigate security concerns. I considered all of the mitigating conditions under AG ¶ 20 including:

(a) 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;

(b) the conditions that resulted in the financial problem were largely beyond the person's control (e.g., loss of employment, a business downturn, unexpected medical emergency, a death, divorce or separation, clear victimization by predatory lending practices, or identity theft), and the individual acted responsibly under the circumstances; and

(d) the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts.

Applicant has addressed her past financial difficulties. She has demonstrated that future financial problems are unlikely. Mitigation under AG ¶ 20 has been established. Guideline F is found for Applicant.

WHOLE PERSON CONCEPT

Under the whole-person concept, the administrative judge must evaluate an applicant’s eligibility for a security clearance by considering the totality of the applicant’s conduct and all relevant circumstances. The administrative judge should consider the nine adjudicative process factors listed at AG ¶ 2(d):

(1) the nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the conduct, to include knowledgeable participation; (3) the frequency and recency of the conduct; (4) the individual’s age and maturity at the time of the conduct; (5) the extent to which participation is voluntary; (6) the presence or absence of rehabilitation and other permanent 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.

Under AG ¶ 2(c), the ultimate determination of whether to grant eligibility for a security clearance must be an overall commonsense judgment based upon careful consideration of the guidelines and the whole-person concept.

I considered the potentially disqualifying and mitigating conditions in light of all facts and circumstances surrounding this case. I have incorporated my comments under Guideline F in my whole-person analysis. Applicant has a distinguished history of working as an independent contractor for the State Department as evidenced by a plethora of letters of recommendation, citations and achievement awards. (AppX C.) She performs well at her job.

Overall, the record evidence leaves me without questions or doubts as to Applicant’s eligibility and suitability for a security clearance. For all these reasons, I conclude Applicant mitigated the Financial Considerations security concerns.

FORMAL FINDINGS

Formal findings for or against Applicant on the allegations set forth in the SOR, as required by ¶ E3.1.25 of the Directive, are:

Paragraph 1, Guideline F:

FOR APPLICANT

Subparagraphs 1.a.-1.p:

For Applicant

CONCLUSION

In light of all of the circumstances presented by the record in this case, it is clearly consistent with the national interest to grant Applicant national security eligibility for a security clearance. Eligibility for access to classified information is granted.

________________________ Richard A. Cefola Administrative Judge