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ISCR Case 18-01827 — CASE

ISCR Case 18-01827denied

Case Headnote

ISCR Case No. 18-01827

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

Summary

A 60-year-old defense contractor employee was denied a security clearance under Guideline F (Financial Considerations) due to significant past-due medical debts totaling approximately $66,383. The Statement of Reasons detailed four specific past-due medical bills, which the applicant admitted: one for about $65,000, another for about $871, a third for about $328, and a fourth for about $184.

The judge acknowledged the applicant's claims that his financial difficulties stemmed from unemployment and medical emergencies. However, the denial was based on the applicant's failure to demonstrate that future financial problems were unlikely.

Ultimately, the applicant did not provide sufficient evidence of responsible action to address his ongoing financial issues, leading to the denial of his security clearance. Disqualifying conditions under AG ¶ 19(a), (b), and (c) were raised, while mitigating conditions under AG ¶ 20(a) and (b) were applied but did not overcome the security concerns.

Why the Applicant Was Denied

The applicant admitted to significant past-due medical debts totaling approximately $66,383.
The applicant failed to provide evidence that future financial problems were unlikely despite attributing his debts to unemployment and medical emergencies.
The applicant did not demonstrate responsible action to address his ongoing financial issues.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability to Satisfy Debts
AG ¶ 19(b)raisedUnwillingness to Satisfy Debts Regardless of the Ability to Do So
AG ¶ 19(c)raisedHistory of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(a)rejectedBehavior Happened so Long Ago, Was Infrequent, or Occurred Under Circumstances Unlikely to RecurThe applicant's financial problems are ongoing.
AG ¶ 20(b)rejectedConditions Resulting in Financial Problems Were Largely Beyond the Person's ControlThe applicant has not demonstrated responsible action to address his debts.

Key Rule Quoted

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

Procedural Posture

SOR issuedAug 8, 2018
Answer filedAug 28, 2018
Hearing heldOct 16, 2018Applicant submitted no documentation at the hearing.
Decision dateMar 7, 2019

Cite For

Financial Considerations Under Guideline F
Impact of Ongoing Financial Issues on Security Clearance Eligibility
Importance of Demonstrating Future Financial Stability in Clearance Cases

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: denied

The judge found against the applicant on all allegations related to financial considerations under Guideline F, specifically concerning outstanding medical debts totaling approximately $66,383. The applicant admitted to all debts but failed to provide sufficient evidence to mitigate the financial concerns raised.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant admitted a past-due medical bill in the amount of about $65,000. $65,000	Against Applicant	Medical Debt	Admitted	—	—	—
1.b	Applicant admitted a past-due medical bill in the amount of about $871. $871	Against Applicant	Medical Debt	Admitted	—	—	—
1.c	Applicant admitted a past-due medical bill in the amount of about $328. $328	Against Applicant	Medical Debt	Admitted	—	—	—
1.d	Applicant admitted a past-due medical bill in the amount of about $184. $184	Against Applicant	Medical Debt	Admitted	—	—	—

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. 18-01827

)

) Applicant for Security Clearance )

For Government: Aubrey De Angelis, Esq., Department Counsel For Applicant: Pro se

March 7, 2019 ______________

STATEMENT OF CASE

______________

CEFOLA, Richard A., Administrative Judge:

Statement of the Case

On August 8, 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 August 28, 2018, and requested a hearing before an administrative judge. (Answer.) The case was assigned to me on September 21, 2018. The Defense Office of Hearings and Appeals (DOHA) issued a notice of hearing on September 24, 2018, scheduling the hearing for October 16, 2018. The hearing was convened as scheduled. The Government offered Exhibits (GXs) 1 through 5, which were admitted into evidence. Applicant testified on his own behalf. Applicant submitted no documentation at his hearing, however, the record was left open for three months, until January 16, 2019, for receipt of additional documentation. Applicant

submitted no documentation. However, he did submit a two sentence closing statement, dated January 10, 2019, which I have marked as Applicant’s Exhibit (AppX) A. In it he avers, In part, the following: “we [he and his wife] are still working on this matter.” DOHA received the transcript of the hearing (TR) on October 25, 2018.

FINDINGS OF FACT

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

Applicant is a 60-year-old employee of a defense contractor. (GX 1 at page 7.) He has been employed with the defense contractor since September of 2017. (GX 1 at page 12.) He has held a security clearance since June of 2010. (GX 1 at page 57.) He is married, and has thirteen children, seven of whom are “adopted . . . grandchildren.’ (TR at page 11 line 12 to page 15 line 21.) Applicant attributes his past-due indebtedness to a five year period of unemployment, and to a “slip and fall” injury sustained at a grocery store. Applicant’s current salary is about “$120,000,” with “$45,000” in a checking account. (TR at page 39 line 7 to page 40 line 3.)

Guideline F - Financial Considerations

1.a. In his answer to the SOR, Applicant admitted a past-due medical bill in the amount of about $65,000. At his hearing Applicant appears to take issue with this debt. (TR at page 21 line 7 to page 31 line 8, and at page 33 lines 4–18.) However, this alleged past-due debt is supported the Government’s most recent July 2018 credit report. (GX 5 at page 1.) Furthermore, in his Answer, his hospital medical bill shows that his “copay deductible” has increased to $79,000. (Answer at page “52 of 213.”) I find that this substantial medical debt is still outstanding; and as such, this allegation is found against Applicant.

1.b. In his answer to the SOR, Applicant also admitted a past-due medical bill in the amount of about $871. At his hearing Applicant again appears to take issue with this debt. (TR at page 37 lines 9–14.) However, this alleged past-due debt is supported the Government’s November 2017 credit report. (GX 4 at page 8.) I find that this medical debt is still outstanding; and as such, this allegation is found against Applicant.

1.c. In his answer to the SOR, Applicant admitted a past-due medical bill in the amount of about $328. At his hearing Applicant appears to take issue with this debt. (TR at page 37 lines 16–21.) However, this alleged past-due debt is supported the Government’s November 2017 credit report. (GX 4 at page 8.) I find that this medical debt is still outstanding; and as such, this allegation is found against Applicant.

1.d. In his answer to the SOR, Applicant admitted a past-due medical bill in the amount of about $184. This alleged past-due debt is also supported the Government’s November 2017 credit report. (GX 4 at page 8.) I find that this medical debt is still outstanding; and as such, this allegation is found against Applicant.

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. Three are potentially applicable in this case:

(a) inability to satisfy debts;

(b) unwillingness to satisfy debts regardless of the ability to do so; and

Applicant has 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; and

(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.

Applicant’s financial problems are ongoing. Although he can attribute much of his debt to an extensive period of unemployment, and to an unexpected medical emergency, Applicant has yet to address these debts. He has not demonstrated that future financial problems are unlikely. Mitigation under AG ¶ 20 has not been established. Guideline F is found against 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. Overall, the record evidence leaves me with questions and doubts as to Applicant’s eligibility and suitability for a security clearance. For all these reasons, I conclude Applicant failed to mitigate 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:

AGAINST APPLICANT

Subparagraph 1.a:

Against Applicant Subparagraph 1.b:

Against Applicant Subparagraph 1.c:

Against Applicant Subparagraph 1.d:

Against Applicant

CONCLUSION

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 Applicant national security eligibility for a security clearance. Eligibility for access to classified information is denied.

________________________ Richard A. Cefola Administrative Judge