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ISCR Case 20-00390 — CASE

ISCR Case 20-00390granted

Case Headnote

ISCR Case No. 20-00390

grantedOct 19, 2020· Hon. Richard A. Cefola· hearing

Summary

A 47-year-old retired Navy veteran was granted a national security eligibility clearance despite allegations under Guideline F, Financial Considerations. The Statement of Reasons cited child support arrears of approximately $23,467 and two past-due debts to Creditor B totaling about $8,407. The applicant admitted to these debts but denied owing $1,901 to Creditor D and $427 to Creditor E.

Disqualifying conditions AG ¶ 19(a) and AG ¶ 19(c) were raised. However, the administrative judge applied mitigating conditions AG ¶ 20(b), AG ¶ 20(d), and AG ¶ 20(e). The applicant demonstrated a good-faith effort by making significant monthly payments toward child support arrears and settling the two debts to Creditor B for $4,100.

Furthermore, the applicant successfully disputed the debts to Creditor D and Creditor E, which were reported as paid. These actions convinced the judge that the applicant's financial issues were under control, leading to the decision to grant the clearance.

Why the Applicant Prevailed

The applicant made significant monthly payments towards child support arrears, demonstrating a good-faith effort to address his financial obligations.
The applicant settled two past-due debts for less than the owed amount, indicating responsible financial behavior.
The applicant successfully disputed two debts that were reported as paid, showing that he was proactive in managing his financial situation.

Conditions Referenced

Disqualifying

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

Mitigating

AG ¶ 20(b)appliedConditions Largely Beyond the Person's ControlThe applicant's financial difficulties were attributed to being underemployed after retirement.
AG ¶ 20(d)appliedGood-faith Effort to Repay DebtsThe applicant made significant monthly payments towards his child support arrears.
AG ¶ 20(e)appliedDispute of Legitimacy of Past-due DebtsThe applicant provided evidence that two disputed debts were paid.

Key Rule Quoted

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

Procedural Posture

SOR issuedApr 30, 2020
Answer filedMay 12, 2020
Hearing held—Decided on the written record without a hearing.
Decision dateOct 19, 2020

Cite For

Good-faith Efforts in Managing Financial Obligations Under Guideline F
Mitigation of Financial Issues Due to Circumstances Beyond the Applicant's Control
Successful Dispute of Debts as a Mitigating Factor in Security 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: Decision on RecordDecided: granted

The judge found that the applicant had made significant efforts to address his financial obligations, particularly regarding child support arrears. All allegations under Guideline F were resolved in favor of the applicant, leading to the granting of his security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant admits that he was in arrears for his child support in the amount of about $23,467. $23,467	For Applicant	Child Support Debt	Admitted	—	(b) conditions largely beyond the person’s control; acted responsibly	Documented Payment Plan with Creditor
1.b	Applicant admits that he owes two past-due to Creditor B totaling about $8,407. $8,407	For Applicant	Unspecified Financial	Admitted	—	(b) conditions largely beyond the person’s control; acted responsibly	Documented Debt Paid in Full
1.c	Applicant has settled these debts for $4,100. $4,100	For Applicant	Unspecified Financial	Unknown	—	—	—
1.d	Applicant denies that he owes a past-due debt to Creditor D in the amount of $1,901. $1,901	For Applicant	Unspecified Financial	Denied	—	—	—
1.e	Applicant denies that he owes a past-due debt to Creditor E in the amount of $427. $427	For Applicant	Unspecified Financial	Denied	—	—	—

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: 20-00390

) Applicant for Security Clearance )

Appearances For Government: Andrea M. Corrales, Esquire, Department Counsel For Applicant: Pro se October 19, 2020

STATEMENT OF CASE

CEFOLA, Richard A., Administrative Judge: Statement of Case On March 20, 2019, Applicant submitted a security clearance application (SF 86). On April 30, 2020, the Department of Defense Consolidated Adjudications Facility (DoD CAF) issued Applicant a Statement of Reasons (SOR), detailing security concerns under Guideline F, Financial Considerations. (Item 1.) The action was taken under Executive Order (EO) 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended; DoD Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the National Security Adjudicative Guidelines for Determining Eligibility for Access to Classified Information or Eligibility to Hold a Sensitive Position (AG), effective June 8, 2017. Applicant answered the SOR on May 12, 2020. He admitted the first three allegations with explanations, but denied the last two SOR allegations, also with explanations, and requested that his case be decided by an administrative judge on the written record without a hearing. (Item 2.) On July 30, 2020, Department Counsel

submitted the Government’s written case. A complete copy of the File of Relevant Material (FORM), containing seven Items, was mailed to Applicant on August 3, 2020, and received by him on August 11, 2020. The FORM notified Applicant that he had an opportunity to file objections and submit material in refutation, extenuation, or mitigation within 30 days of his receipt of the FORM. Applicant responded to the FORM on September 8, 2020 (Response). He submitted additional information in his FORM response, to which Department Counsel had no objection. DOHA assigned the case to me on September 22, 2020. Items 1 through 7 are admitted into evidence. Applicant’s response to the FORM (Response) is also admitted.

FINDINGS OF FACT

Guideline F – Financial Considerations Applicant is 47 years old. He is divorced, with three children. Applicant retired from the Navy in January of 2016 with an honorable discharge. (Item 3 at pages 7, 19, 22–23, and 25–27.)

1.a. Applicant admits that he was in arrears for his child support in the amount of about $23,467. He attributes this delinquency to being “underemployed” after retiring from the Navy. (Item 7 at page 5.) Applicant is paying down this arrears with monthly payments of $666 from his retirement pay, with monthly withholdings of $90 from his civilian pay, and with any tax refunds also being applied to said arrears ($1,200 from tax year 2019.) This is supported by documentation provided by Applicant. (Response at pages 3–12.) I find that Applicant monthly payments of $756, or more than $9,000 annually, is a good-faith effort to address this, his largest past-due debt. This allegation is found for Applicant.

1.b. and 1.c. Applicant admits that he owes two past-due to Creditor B totaling about $8,407. He has settled these debts for $4,100, as evidenced by documentation submitted by Applicant. (Response at pages 13–16.) These allegations are found for Applicant.

1.d. Applicant denies that he owes a past-due debt to Creditor D in the amount of $1,901. As the past-due amount is noted as “$0” on the government’s most recent July 2020 Credit Report (CR), this allegation is found for Applicant. (Item 4 at page 2.)

1.e. Applicant denies that he owes a past-due debt to Creditor E in the amount of $427. As the past-due amount is noted as “$0” on the government’s most recent July 2020 Credit Report (CR), this allegation is found for Applicant. (Item 4 at page 5.)

POLICIES

When evaluating an applicant’s suitability for national security eligibility, the administrative judge must consider the adjudicative guidelines. In addition to brief introductory explanations for each guideline, the adjudicative guidelines (AG) 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, these guidelines are applied 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. The entire process is a conscientious scrutiny of applicable guidelines in the context 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. I have not drawn inferences based on mere speculation or conjecture. Directive ¶ E3.1.14, requires the Government to present evidence to establish controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, an “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 applying for national security eligibility 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 national security eligibility. 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 or sensitive information. Finally, as emphasized in Section 7 of EO 10865, “[a]ny determination under this order adverse to an applicant shall be a determination 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 concerns relating to the guideline for financial considerations are set out in AG ¶ 18, which reads in pertinent part: 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. . . . AG ¶ 19 describes two conditions that could raise security concerns and may be disqualifying in this case: (a) inability to satisfy debts; and (c) a history of not meeting financial obligations. Applicant has significant past-due indebtedness. These facts establish prima facie support for the foregoing disqualifying conditions, and shift the burden to Applicant to mitigate those concerns. The guideline includes four conditions in AG ¶ 20 that could mitigate the security concerns arising from Applicant’s alleged financial difficulties: (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;

(d) the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts; and (e) the individual has a reasonable basis to dispute the legitimacy of the past-due debt which is the cause of the problem and provides documented proof to substantiate the basis of the dispute or provides evidence of actions to resolve the issue. Applicant retired from the Navy and was underemployed. He acted responsibly under unforeseen difficult circumstances that were completely beyond his control, and there are clear indications that his financial issues are under control. He is making significant monthly payments towards his back child support, has settle his two debts with Creditor B, and disputes the remaining two debts as they have been paid. The record establishes clear mitigation of financial security concerns under the provisions of AG ¶ 20.

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.

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

I considered the potentially disqualifying and mitigating conditions in light of all pertinent facts and circumstances surrounding this case. Applicant is a mature adult, retired from the Navy, who took reasonable and effective action to resolve his financial issues. The likelihood that financial problems will recur is minimal. Overall, the record evidence leaves me without doubt as to Applicant’s judgment, eligibility, and suitability for a security clearance. He fully met his burden to mitigate the security concerns arising under the guideline for financial considerations.

FORMAL FINDINGS

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 and a security clearance. National security eligibility is granted.

Formal findings for or against Applicant on the allegations set forth in the SOR, as required by ¶ E3.1.25 of Enclosure 3 of the Directive, are: Paragraph 1, Guideline F: FOR APPLICANT Subparagraphs 1.a through1.e: For Applicant

CONCLUSION

________ Richard A. Cefola Administrative Judge