ISCR Case No. 20-03306

______________ ______________ DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS In the matter of: ) ) ) ISCR Case: 20-03306 ) Applicant for Security Clearance ) Appearances For Government: David F. Hayes, Esquire, Department Counsel For Applicant: Pro se January 27, 2022

CEFOLA, Richard A., Administrative Judge: Statement of Case On May 3, 2020, Applicant submitted a security clearance application (SF-86). On June 8, 2021, 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 August 26, 2021. He admitted all of the SOR allegations concerning his delinquent debts, and requested that his case be decided by an administrative judge on the written record without a hearing. (Item 1.) On September 22, 2021, Department Counsel submitted the Government’s written case. A complete

copy of the File of Relevant Material (FORM), containing four Items, was mailed to Applicant, and 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 November 10, 2021 (Response 1), and again on November 24, 2021 (Response 2). He did not object to Items 1 through 4, and submitted additional information in his FORM responses, to which Department Counsel had no objection. DOHA assigned the case to me on December 2, 2021. Items 1 through 4 are admitted into evidence. Applicant’s responses to the FORM are admitted into evidence.

Guideline F – Financial Considerations Applicant is 31 years old. He is married and has no children. (Item 1 at pages 7, and 32–34.) Applicant avers that in 2014, he “lost everything he owned in a flood. . . . [He] did not have a job at the time, but needed essential items so he used the credit cards he had, as well as opened up store credit cards, to buy essentials.” (Item 3 at page 8.) 1.a. Applicant admits that he owes a past-due debt to Creditor A in the amount of about $10,124. (Response 2 at page 21.) This allegation is found against Applicant. 1.b. Applicant initially admitted he owed a past-due debt to Creditor B in the amount of about $8,179. He has now submitted documentation showing this debt has been satisfied. (Response 2 at pages 5–7.) This allegation is found for Applicant. 1.c. Applicant admits that he owes a past-due debt to Creditor C in the amount of about $7,705. (Response 1 credit report at page 7, and Response 2 at page 21.) This allegation is found against Applicant. 1.d. and 1.g. Applicant initially admitted he owed past-due debts to Creditor D in an amount totaling about $7,413. He now avers that these debts have been resolved. However, these debts still appear as past-due on the Government’s May 2020 credit report. (Item 4 at page 19.) These allegations are found against Applicant. 1.e, 1.k. and 1.m. Applicant initially admitted he owed past-due debts to Creditor E in an amount totaling about $5,464. He avers that these debts have been resolved, and has submitted documentation from Creditor E supporting this averment. (Response 2 at pages 8–13.) These allegations are found for Applicant.

1.f. Applicant initially admitted he owed a past-due debt to Creditor F in the amount of about $2,417. He has now submitted documentation showing this debt has been satisfied. (Response 2 at pages 23–27.) This allegation is found for Applicant. 1.g. has been addressed with 1.d, above. 1.h. Applicant initially admitted he owed a past-due debt to Creditor H in the amount of about $1,522. He has now submitted documentation showing this debt has been satisfied. (Response 2 at pages 1–4.) This allegation is found for Applicant. 1.i. Applicant initially admitted he owed a past-due debt to Creditor I in the amount of about $1,500. He has now submitted documentation showing this debt has been satisfied. (Response 1 at pages 1–8, and Response 2 at pages 14–19.) This allegation is found for Applicant. 1.j. Applicant initially admitted he owed a past-due debt to Creditor J in an amount totaling about $1,369. He now avers that this debt has been resolved. However, this debt still appears as past-due on the Government’s May 2020 credit report. (Item 4 at page 22.) This allegation is found against Applicant. 1.k. has been addressed with 1.e, above. 1.l. Applicant initially admitted he owed a past-due debt to Creditor L in an amount totaling about $649. He now avers that this debt have been resolved. However, this debt still appear as past-due on the Government’s May 2020 credit report. (Item 4 at page 22.) This allegation is found against Applicant. 1.m. has been addressed with 1.e, above. 1.n. Applicant initially admitted he owed a past-due debt to Creditor N in the amount of about $415. He has now submitted documentation showing this debt has been satisfied. (Response 2 at pages 22–26.) This allegation is found for Applicant.

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.)

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 had a plethora of past-due debts totaling about $48,000. 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 can attribute his financial difficulties to a devastating flood he experienced in 2014. However, in the intervening seven to eight years, he has addressed only about half of his admitted past-due indebtedness. Applicant still has over $27,000 in past-due debts he has yet to address. Financial Considerations is found against Applicant.

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. He has not met his burden to mitigate the security concerns arising under the guideline for financial considerations.

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: Subparagraph 1.a: AGAINST APPLICANT

Against Applicant Subparagraph 1.b: For Applicant Subparagraphs 1.c. and 1.d: Against Applicant Subparagraphs 1.e. and 1.f: For Applicant Subparagraph 1.g: Against Applicant Subparagraphs 1.h. and 1.i: For Applicant

Subparagraph 1.j:

Against Applicant

Subparagraph 1.k:

For Applicant

Subparagraph 1.l:

Against Applicant

Subparagraphs 1.m. and 1.n:

For Applicant

________ 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