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ISCR Case 19-01110 — CASE

ISCR Case 19-01110denied

Case Headnote

ISCR Case No. 19-01110

deniedDec 9, 2019· Hon. Richard A. Cefola· hearing

Summary

A 53-year-old unmarried applicant was denied a security clearance under Guideline F (Financial Considerations) due to significant past-due debts exceeding $28,000. The Statement of Reasons detailed three specific outstanding debts: approximately $3,635 owed to Creditor A, about $15,841 to Creditor B, and roughly $8,631 to Creditor C. These financial issues raised concerns under Disqualifying Conditions AG ¶ 19(a), AG ¶ 19(b), and AG ¶ 19(c).

The denial was primarily based on the applicant's substantial past-due debt and her failure to provide any mitigating evidence, despite being given opportunities to do so. This lack of response led to a formal finding against her on all allegations.

The Adjudicator concluded that the applicant's failure to address these debts raised serious questions about her judgment and reliability, ultimately resulting in the denial of her security clearance.

Why the Applicant Was Denied

The applicant has significant past-due debt totaling over $28,000.
The applicant did not submit any evidence in mitigation despite being given opportunities to do so.
The applicant's failure to address the debts raised serious questions about her judgment and reliability.

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

Key Rule Quoted

“Any doubt concerning personnel being considered for national security eligibility will be resolved in favor of the national security.”

Procedural Posture

SOR issuedApr 17, 2019
Answer filedMay 5, 2019Applicant did not admit or deny allegations.
Hearing held—
Decision dateDec 9, 2019

Cite For

Significant Financial Issues as a Disqualifying Factor Under Guideline F
Failure to Provide Mitigating Evidence Despite Opportunities
Importance of Financial Responsibility in National Security 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: Decision on RecordDecided: denied

The judge found against the applicant on all financial allegations under Guideline F, determining that the applicant's debts raised significant security concerns. The applicant did not provide sufficient evidence to mitigate these concerns, leading to a denial of the security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant is indebted to Creditor A for a past-due debt in the amount of about $3,635. $3,635	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.b	Applicant is indebted to Creditor B for a past-due debt in the amount of about $15,841. $15,841	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.c	Applicant is indebted to Creditor C for a past-due debt in the amount of about $8,631. $8,631	Against Applicant	Unspecified Financial	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: 19-01110

) Applicant for Security Clearance )

For Government: Andre M. Gregorian, Esquire, Department Counsel For Applicant: Pro se

December 9, 2019 ______________

STATEMENT OF CASE

______________

CEFOLA, Richard A., Administrative Judge:

On December 13, 2017, Applicant submitted a security clearance application (SF-86). On April 17, 2019, 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 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 5, 2019. She neither admitted nor denied the three SOR allegations, but merely wrote “See attach.” Nothing was attached to the answer provided to me. On June 13, 2019, Department Counsel submitted the Government’s written case. A complete copy of the File of Relevant Material (FORM),

containing five Items, was received by the Applicant, who acknowledged receipt on June 19, 2019. The FORM notified Applicant that she had an opportunity to file objections and submit material in refutation, extenuation, or mitigation within 30 days of his receipt of the FORM. Applicant submitted nothing.

FINDINGS OF FACT

Guideline F – Financial Considerations

Applicant is 53 years old. She is unmarried, but has two adult children. (GX 2 at pages 7, 15 and 21–22.)

1.a. It is alleged that Applicant is indebted to Creditor A for a past-due debt in the amount of about $3,635. This allegation is supported by a March 2019 credit report. (Item 5 at page 2.) Applicant failed to submit any evidence in mitigation. This allegation is found against Applicant.

1.b. It is alleged that Applicant is indebted to Creditor B for a past-due debt in the amount of about $15,841. This allegation is also supported by a March 2019 credit report. (Item 5 at page 2.) Applicant failed to submit any evidence in mitigation. This allegation is found against Applicant.

1.c. It is alleged that Applicant is indebted to Creditor C for a past-due debt in the amount of about $8,631. This allegation is supported by a March 2019 credit report. (Item 5 at page 2.) Applicant failed to submit any evidence in mitigation. 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 three conditions that could raise security concerns and may be disqualifying 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 debt, and submited nothing in mitigation. These facts establish prima facie support for the foregoing disqualifying conditions, and shift the burden to Applicant to mitigate those concerns.

The guideline includes six 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;

(c) the individual has received or is receiving financial counseling for the problem from a legitimate and credible source, such as a non-profit credit counseling service, and there are clear indications that the problem is being resolved or is under control;

(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.

None of these apply. Applicant; despite given an opportunity to respond to the SOR and the FORM, has done nothing. As such, the record does not establish 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. Overall, the record evidence leaves me with serious questions and doubts as to Applicant’s judgment, eligibility, and suitability for a security clearance. She has not met her burden 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 through1.c:

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