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ISCR Case 19-01221 — CASE

ISCR Case 19-01221granted

Case Headnote

ISCR Case No. 19-01221

grantedJan 27, 2020· Hon. Richard A. Cefola· hearing

Summary

A 48-year-old defense contractor employee's security clearance eligibility was granted despite initial concerns under Guideline F (Financial Considerations). The Statement of Reasons detailed four specific financial obligations. The applicant admitted to a debt of approximately $15,596 to Creditor A, resulting from an automobile repossession, which was settled for $6,300. He had made five of eighteen scheduled payments on this settled amount.

Additionally, the applicant acknowledged an overpayment of unemployment benefits to State B, totaling about $1,731, which has since been paid. He also admitted to a past-due credit union debt of approximately $4,467 to Creditor C, towards which he is making monthly payments of $100. Finally, a past-due cable TV debt of about $239 to Creditor D was also acknowledged and has been paid.

The administrative judge granted the clearance after finding that the applicant had addressed all past-due debts and demonstrated a positive cash flow. He provided evidence of a good-faith effort to repay creditors and resolve his financial issues. The applicant was also noted to be well-respected in his community and workplace.

Why the Applicant Prevailed

The applicant addressed all past-due debts and demonstrated a positive cash flow.
He provided evidence of a good-faith effort to repay creditors and resolve financial issues.
The applicant was well-respected in his community and workplace.

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)appliedBehavior Happened Long Ago or Infrequently
AG ¶ 20(b)appliedConditions Beyond the Person's Control
AG ¶ 20(d)appliedGood-faith Effort to Repay Debts

Key Rule Quoted

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

Procedural Posture

SOR issuedMay 9, 2019
Answer filedJun 13, 2019
Hearing heldSep 25, 2019rescheduled from August 14, 2019
Decision dateJan 27, 2020

Cite For

Mitigation of Financial Issues Under Guideline F
Importance of Community and Workplace Respect in Security Clearance Decisions
Whole-person Concept in Evaluating Security Clearance Eligibility

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 addressed all financial delinquencies, including settling debts and making payments on others. As a result, the judge concluded that the financial concerns were mitigated and ruled in favor of the applicant on all allegations under Guideline F.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant admits that he was indebted to Creditor A, as the result of an automobile repossession, in the amount of about $15,596. This debt has been settled for $6,300, and Applicant has made five of '18' payments, as evidenced by documentation from Creditor A. $6,300	For Applicant	Auto Loan Debt	Admitted	—	—	—
1.b	Applicant admits that he was indebted to State B, as the result of the overpayment of unemployment benefits, in the amount of about $1,731. This debt has been paid, as evidenced by documentation from State B. $1,731	For Applicant	Unspecified Financial	Admitted	—	—	—
1.c	Applicant admits that he is indebted to Creditor C for a past-due credit union debt, in the amount of about $4,467. Applicant is making monthly payments of $100 towards this debt, as evidenced by documentation from Creditor C. $4,467	For Applicant	Unspecified Financial	Admitted	—	—	—
1.d	Applicant admits that he was indebted to Creditor D for a past-due cable TV debt, in the amount of about $239. This debt has been paid, as evidenced by documentation from Creditor D. $239	For Applicant	Unspecified Financial	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. 19-01221

)

) Applicant for Security Clearance )

For Government: Andrew Henderson, Esq., Department Counsel For Applicant: Pro se

January 27, 2020 ______________

STATEMENT OF CASE

______________

CEFOLA, Richard A., Administrative Judge:

Statement of the Case

On May 9, 2019, 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 June 13, 2019 (Answer), and requested a hearing before an administrative judge. The case was assigned to me on July 12, 2019. The Defense Office of Hearings and Appeals (DOHA) issued a notice of hearing on July 24, 2019; originally scheduling the hearing for August 14, 2019, but it was rescheduled for September 25, 2019. The hearing was convened as rescheduled. The Government offered Exhibits (GXs) 1 through 5, which were admitted into evidence. Applicant testified on his own behalf, and offered two sets of documents, which I marked Applicant’s Exhibits (AppXs) A and B, and admitted into evidence. The record was left

open until November 15, 2019, for receipt of additional documentation. On November 7, 2019, Applicant offered a set of documents, marked as AppX C and admitted into evidence. DOHA received the transcript of the hearing (TR) on October 7, 2019.

FINDINGS OF FACT

Applicant admitted to 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 48-year-old employee of a defense contractor. (GX 1 at pages 5 and 10.) He has been employed with the defense contractor since 2016. (GX 1 at page 10.) He is single, but has three children: two who are adults and a seventeen-year-old, who lives with Applicant due to the recent death of the child’s mother. (TR at page 15 line 13 to page 18 line 21.)

Guideline F - Financial Considerations

Applicant’s past-due indebtedness goes back at least until 2015; but due to prior periods of unemployment and underemployment, he has only recently began to address his admitted past-due indebtedness. (TR at page 19 line 24 to page 30 line 4.) He now has a positive monthly cash flow of about $625, and is well respected in his community and in the workplace, as evidenced by six letters of support. (AppX B, and AppX C at page 6.)

1.a. Applicant admits that he was indebted to Creditor A, as the result of an automobile repossession, in the amount of about $15,596. This debt has been settled for $6,300, and Applicant has made five of “18” payments, as evidenced by documentation from Creditor A. (TR at page 19 line 24 to page 23 line 10, AppX A at pages 1 and 2, and AppX C at pages 1–4.) This allegation is found for Applicant.

1.b. Applicant admits that he was indebted to State B, as the result of the overpayment of unemployment benefits, in the amount of about $1,731. This debt has been paid, as evidenced by documentation from State B. (TR at page 23 line 11 to page 26 line 17, and AppX A at page.3.) This allegation is found for Applicant.

1.c. Applicant admits that he is indebted to Creditor C for a past-due credit union debt, in the amount of about $4,467. Applicant is making monthly payments of $100 towards this debt, as evidenced by documentation from Creditor C. (TR at page 26 line 17 to page 27 line 12, at page 28 lines 4–25, AppX A at page 4, and AppX C at page 5.) This allegation is found for Applicant.

1.d. Applicant admits that he was indebted to Creditor D for a past-due cable TV debt, in the amount of about $239. This debt has been paid, as evidenced by documentation from Creditor D. (TR at page 29 line 1 to page 30 line 4, and Answer Attachment D.) This allegation is found for 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;

(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 all of his delinquencies. He has demonstrated that future financial problems are unlikely. Mitigation under AG ¶ 20 has been established. The Financial Considerations guideline 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. Some of the factors in AG ¶ 2(d) were addressed under those guidelines, but some warrant additional comment. Applicant is well respected in his community and in the workplace. He performs well at his job. (AppC B.)

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.d.:

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