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ISCR Case 19-01963 — CASE

ISCR Case 19-01963granted

Case Headnote

ISCR Case No. 19-01963

grantedFeb 25, 2020· Hon. Richard A. Cefola· hearing

Summary

This DOHA security clearance decision involved a 72-year-old defense contractor and retired U.S. Air Force member, whose eligibility was initially questioned under Guideline F (Financial Considerations). The Statement of Reasons (SOR) alleged past-due student loan debts, including one to Creditor C for approximately $43,870, which were added during the hearing. The applicant admitted to the debts but asserted they resulted from identity theft perpetrated by his daughter.

The judge found that the applicant successfully mitigated the financial concerns. Key to this determination was the finding that the applicant was unaware of the student loans, which were taken out in his name without his knowledge. The judge concluded that the applicant demonstrated no poor judgment or unreliability concerning these debts.

Ultimately, the applicant's daughter was identified as responsible for incurring the loans and is currently engaged in a lawsuit against the creditor. Based on these mitigating factors, the applicant was granted eligibility for a security clearance.

Why the Applicant Prevailed

The applicant was unaware of the student loans taken out in his name due to identity theft.
The applicant demonstrated no poor judgment or unreliability regarding the debts.
The applicant's daughter was responsible for the loans and is currently involved in a lawsuit against the creditor.

Conditions Referenced

Disqualifying

AG ¶ 19(a)rejectedInability to Satisfy DebtsApplicant was unaware of the debts.
AG ¶ 19(b)rejectedUnwillingness to Satisfy Debts Regardless of the Ability to Do SoApplicant did not knowingly incur the debts.
AG ¶ 19(c)rejectedHistory of Not Meeting Financial ObligationsApplicant did not have a history of failing to meet obligations.

Mitigating

AG ¶ 20(a)appliedThe Behavior Was Not Recent and Was Caused by Circumstances Beyond the Applicant's Control
AG ¶ 20(b)notedThe Applicant Has Taken Positive Steps to Address the Financial Issues
AG ¶ 20(c)notedThe Applicant Has Shown a Good Faith Effort to Repay Debts

Key Rule Quoted

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

Procedural Posture

SOR issuedJul 26, 2019
Answer filedAug 21, 2019
Hearing heldDec 9, 2019hearing convened as scheduled
Decision dateFeb 25, 2020

Cite For

Identity Theft as a Mitigating Factor Under Guideline F
Consideration of Family Circumstances in Financial Obligations
The Whole-person Concept in Security Clearance Evaluations

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 mitigated the financial concerns raised under Guideline F, primarily due to identity theft issues related to the debts. The applicant was deemed eligible and suitable for a security clearance as the debts were not a result of poor judgment or unreliability.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant admitted to the allegations in SOR ¶¶ 1.a, and 1.b, with the caveat that they were based on identity theft.	For Applicant	Unspecified Financial	Admitted	—	—	—
1.b	Applicant admitted to the allegations in SOR ¶¶ 1.a, and 1.b, with the caveat that they were based on identity theft.	For Applicant	Unspecified Financial	Admitted	—	—	—
1.c	At his hearing, the SOR was amended to add allegation 1.c, a past-due student loan debt to Creditor C in the amount of about $43,870. $43,870	For Applicant	Student Loan Debt	Unknown	—	—	—

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. 19-01963 Applicant for Security Clearance Appearances For Government: Tara Karoian, Esq ., Department Counsel For Applicant: Prose February 25, 2020

STATEMENT OF CASE

CEFOLA, Richard A., Administrative Judge: Statement of the Case On July 26, 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 national security eligibility. Applicant answered the SOR on August 21 , 2019, and requested a hearing before an administrative judge. (Answer.) The case was assigned to me on October 31, 2019. The Defense Office of Hearings and Appeals (DOHA) issued a notice of hearing on November 14, 2019, scheduling the hearing for December 9, 2019. 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 offered a packet of documents, which I marked Applicant's Exhibits (AppXs) A through 0, and admitted into evidence. The record was left open until January 31 , 2020, for receipt of

additional documentation. Applicant offered two additional packets of documents, which were marked as AppXs P and Q and were admitted into evidence. DOHA received the transcript of the hearing (TR) on December 17, 2019.

FINDINGS OF FACT

Applicant admitted to the allegations in SOR ¶¶ 1.a, and 1.b, with the caveat that they were based on identity theft. At his hearing, the SOR was amended to add allegation 1.c, a past-due student loan debt to Creditor C in the amount of about $43,870. (TR at page 21 line1 to page 22 line 4.) He denied SOR allegation ¶ 1.c, again averring identity theft. After a thorough and careful review of the pleadings, exhibits, and testimony, I make the following findings of fact.

Applicant is a 72-year-old employee of a defense contractor. (GX 1 at page 5.) He has been employed with the defense contractor for “19 years.” (TR at page 38 line 7 to page 41 line 17.) Applicant is also retired from the U.S. Air Force. (Id.) He has held a security clearance since 1969. He is married, and has one daughter, who inadvertently caused the identity theft.

Guideline F - Financial Considerations

The SOR alleges three past-due student loan debts: $78,909 owed to Creditor A; $21,060 owed to Creditor B; and $43,870 owed to Creditor C. The genesis of these student loans is detailed in an affidavit from Applicant’s daughter. (AppX P at page 2.) She avers: “Since my father had agreed to cosign on the first two student loans, I believed he would agree to cosign on my other education loans. From October 2006 to April 2008 his information was used on the documents for seven more loans.” (Id.) Applicant did not agree to; and was unaware of, these additional student loans, three of which are alleged in the SOR. (TR at page 41 line 18 to page 46 line 19, and AppX B.) This is further supported by an affidavit from Applicant’s wife who avers: “About November of 2015 we started to receive calls from debt collectors asking about payments on student loans. This is when my husband became aware of all the loans our daughter had taken out without his knowledge.” (AppX Q at page 1.)

Applicant’s daughter is currently involved in a lawsuit against Creditor C. Her attorney avers “[Applicant . . .] is not a party to this lawsuit.” (AppX P, emphasis in original.) This gives further credence to the above averments.

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

None of these apply. Applicant was unaware of his daughter’s past-due student loans. He has not shown poor judgment, unreliability or untrustworthiness. Financial Considerations 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. 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

________________________

Subparagraph 1.a:

For Applicant

Subparagraph 1.b:

For Applicant

Subparagraph 1.c:

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