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ISCR Case 20-00325 — CASE

ISCR Case 20-00325denied

Case Headnote

ISCR Case No. 20-00325

deniedApr 14, 2021· Hon. Richard A. Cefola· hearing

Summary

A 35-year-old married applicant with two stepchildren was denied a security clearance under Guideline F, Financial Considerations, due to unresolved financial debts. The Statement of Reasons alleged ten past-due debts totaling approximately $38,934, which the applicant admitted. However, the applicant denied two additional past-due debts to Creditor H, amounting to about $5,336, and one past-due debt to Creditor L for about $618.

The administrative judge identified disqualifying conditions under Adjudicative Guideline Paragraphs 19(a) and 19(c). The denial was based on the applicant's admitted significant past-due debts and a failure to provide supporting documentation for claims related to her financial situation.

Ultimately, the judge determined that the applicant's financial difficulties were ongoing and not under control, leading to the denial of the security clearance.

Why the Applicant Was Denied

The applicant admitted to significant past-due debts totaling approximately $38,934.
The applicant failed to provide supporting documentation for her claims regarding her financial situation.
The applicant's financial difficulties were ongoing and not under control.

Conditions Referenced

Disqualifying

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

Key Rule Quoted

“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.”

Procedural Posture

SOR issuedMay 1, 2020
Answer filedJul 6, 2020Applicant requested a decision on the written record.
Hearing held—Decision made based on written record.
Decision dateApr 14, 2021

Cite For

Denial of Security Clearance Due to Unresolved Financial Issues
Importance of Providing Documentation to Support Claims of Financial Mitigation
Ongoing Financial Difficulties as a Disqualifying Factor Under Guideline F

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: denied

The judge found against the applicant on all financial allegations under Guideline F, citing a lack of supporting documentation for both admitted and denied debts. The applicant's financial difficulties were attributed to personal circumstances, but these were not sufficient to mitigate the concerns raised.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant admits to ten alleged past-due debts totaling about $38,934. $38,934	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.h	Applicant denies the two past-due debts to Creditor H in an amount totaling about $5,336. $5,336	Against Applicant	Unspecified Financial	Denied	—	—	—
1.l	Applicant denies the past-due debt to Creditor L in an amount of about $618. $618	Against 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: 20-00325

) Applicant for Security Clearance ) Appearances For Government: Bryan Olmos, Esquire, Department Counsel For Applicant: Pro se April 14, 2021

STATEMENT OF CASE

CEFOLA, Richard A., Administrative Judge: Statement of Case On November 20, 2018, Applicant submitted a security clearance application (SCA). On May 1, 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 July 6, 2020 (Answer). She admitted all allegations of the SOR; except for Subparagraphs 1.h., 1.i. and 1.j., and requested that her case be decided by an administrative judge on the written record without a hearing. (Item 2.) On November 3, 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 November 4, 2020, and received by her on November 18, 2020. The FORM notified Applicant that she had an opportunity to file objections and submit material in refutation, extenuation, or mitigation within 30 days of her receipt of the FORM. Applicant did not respond to the FORM. DOHA assigned the case to me on March 16, 2021. Items 1 through 7 are admitted into evidence.

FINDINGS OF FACT

Guideline F – Financial Considerations

Applicant is 35 years old. (SCA at page 7.) She is married, with two stepchildren. (SCA at pages 23 and 28–29.) Applicant attributes her current financial difficulties to a prior divorce, a period of unemployment and “just forgetting about the debts.” (Item 4 at page 4.)

1.a.~1.g. and 1.j., 1.k. and 1.m. Applicant admits to ten alleged past-due debts totaling about $38,934. She avers that she is working “on a payment plan” as to 1.e., . . . “now [wishes] to dispute” 1.f., . . . and “has paid in full and closed” 1.j. (Answer at page 3.) As Applicant has offered no supporting documentation as to her partial admissions, these allegations are found against Applicant.

1.h. and 1.i. Applicant denies the two past-due debts to Creditor H in an amount totaling about $5,336. As Applicant has offered no supporting documentation as to her denials, these allegations are found against Applicant.

1.l. Applicant denies the past-due debt to Creditor L in an amount of about $618. As Applicant has offered no supporting documentation as to her denial, this allegation is found against Applicant.

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 that she has yet to address. These facts establish prima facie support for the foregoing disqualifying conditions, and shift the burden to Applicant to mitigate those concerns. The guideline includes two 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; 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. Although Applicant may wish to attribute her financial difficulties an unspecified period of unemployment; and to a prior divorce, her financial shortcomings are ongoing. She has not acted responsibly, and there are no clear indications that Applicant’s financial issues are under control. Financial Considerations 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. 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. Overall, the record evidence leaves me with questions and doubts as to Applicant’s judgment, eligibility, and suitability for a security clearance. She has failed to mitigate the security concerns arising under the guideline for financial considerations.

FORMAL FINDINGS

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: AGAINST APPLICANT Subparagraphs 1.a through 1.l: 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 and a security clearance. National security eligibility is denied. Richard A. Cefola Administrative Judge