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ISCR Case 21-00840 — CASE

ISCR Case 21-00840denied

Case Headnote

ISCR Case No. 21-00840

deniedJan 12, 2022· Hon. Darlene Lokey Anderson· hearing

Summary

A 36-year-old shipbuilder with a high school diploma was denied a security clearance under Guideline F (Financial Considerations) due to significant delinquent debts totaling over $27,000. The Statement of Reasons detailed seven specific debts, including a $14,970 child support arrearage owed to a state department of social service, an $8,042 debt placed for collections, a $2,500 charged-off debt, and several delinquent medical accounts ranging from $65 to $938.

The applicant admitted to most of these debts but failed to provide evidence of any efforts to resolve them. Furthermore, these financial obligations were not disclosed on his security clearance application, and he did not demonstrate a good faith effort to address them.

The judge found that the applicant's failure to resolve his debts and his lack of transparency raised concerns about his reliability and trustworthiness, leading to the denial of his security clearance.

Why the Applicant Was Denied

The applicant has multiple delinquent debts totaling over $27,000, primarily related to child support and medical accounts.
The applicant admitted to most of the debts but did not provide evidence of efforts to resolve them.
The applicant failed to disclose these debts on his security clearance application and did not show any good faith effort to address them.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
AG ¶ 19(c)raisedA History 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 issuedAug 2, 2021
Answer filedSep 9, 2021
Hearing held—Decided on the written record.
Decision dateJan 12, 2022

Cite For

Financial Considerations Under Guideline F
Impact of Delinquent Debts on Security Clearance Eligibility
Failure to Demonstrate Good Faith Efforts to Resolve Financial Issues

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 multiple delinquent debts against the applicant, including significant child support arrears and medical debts. The applicant failed to demonstrate any mitigation efforts, leading to a decision against granting security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	A delinquent debt is owed to a state department of social service for child support arrearage in the amount of $14,970. $14,970	Against Applicant	Child Support Debt	Denied	—	—	—
1.b	A delinquent debt is owed to a creditor that was placed for collections in the approximate amount of $8,042. $8,042	Against Applicant	Unspecified Financial	Denied	—	—	—
1.c	A delinquent debt is owed to a creditor that was charged off in the approximate amount of $2,500. $2,500	Against Applicant	Unspecified Financial	Denied	—	—	—
1.d	A delinquent medical account was placed for collection in the approximate amount of $938. $938	Against Applicant	Medical Debt	Denied	—	—	—
1.e	A delinquent medical account was placed for collection in the approximate amount of $368. $368	Against Applicant	Medical Debt	Denied	—	—	—
1.f	A delinquent debt is owed to a creditor that was placed for collection in the approximate amount of $333. $333	Against Applicant	Unspecified Financial	Denied	—	—	—
1.g	A delinquent medical account was placed for collection in the approximate amount of $65. $65	Against Applicant	Medical Debt	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 No. 21-00840 ) ) Applicant for Security Clearance ) Appearances For Government: Tovah Minster, Esq., Department Counsel For Applicant: Pro se January 12, 2022

STATEMENT OF CASE

LOKEY ANDERSON, Darlene D., Administrative Judge: Statement of Case On September 23, 2020, Applicant submitted a security clearance application (e- QIP). (Item 3.) On August 2, 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. The action was taken under Executive Order 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 Adjudicative Guidelines for Determining Eligibility for Access to Classified Information, effective within the DoD after June 8, 2017. Applicant responded to the SOR (Answer) on September 9, 2021. (Item 2.) He requested that his case be decided by an administrative judge on the written record. Department Counsel submitted the Government’s written case on September 21, 2021. A complete copy of the File of Relevant Material (FORM), containing six Items was received by Applicant on October 1, 2021. He was afforded an opportunity to file

objections and submit material in refutation, extenuation, or mitigation within 30 days of receipt of the FORM. Applicant submitted no response to the FORM. DOHA assigned the case to me on December 2, 2021. Items 1 through 6 will hereinafter be referred to as Government Exhibits 1 through 6.

FINDINGS OF FACT

Applicant is 36 years old and married with three children. He has a high school diploma. He is employed by a defense contractor as a shipbuilder. He is seeking to obtain a security clearance in connection with his employment. Guideline F - Financial Considerations The Government alleged that Applicant is ineligible for a clearance because he made financial decisions that indicate poor self-control, lack of judgment, or unwillingness to abide by rules and regulations, all of which raise questions about his reliability, trustworthiness and ability to protect classified information. The SOR alleges that the Applicant is indebted to seven delinquent accounts totaling in excess of $27,000. Applicant admits all of the all debts listed in the SOR, except 1.c. Credit reports of the Applicant dated October 1, 2020, and June 29, 2021, confirm the indebtedness. (Government Exhibits 5 and 6.) Applicant began working for his current employer in January 2020. He has had consistent employment, except for one brief period of unemployment from June 2011 until September/October 2012. (Government Exhibit 3.) Applicant has been married since February 2015. None of Applicant’s children reside with him. (Government Exhibit 4.) In his answer to the SOR, Applicant failed to provide any explanation for his excessive delinquent indebtedness. He also failed to provide any information showing any attempts on his part to contact the creditors and repay or resolve his delinquent debts. Applicant failed to disclose any of these delinquent debts on his 2020 security clearance application. During his subject interview in December 2020, he discussed a delinquent car loan and three medical accounts. The following delinquent debts set forth in the SOR are of security concern: 1.a. A delinquent debt is owed to a state department of social service for child support arrearage in the amount of $14,970. Applicant had an active warrant that was issued in January 2020 for unpaid child support. The warrant was recalled by the court in December 2020. Applicant explained to the Government investigator that he had never been delinquent on child support, but that he stopped paying and had not paid since February 2019. Applicant claims that the notice to appear in court and other documents were sent to his former residence and he subsequently missed his court date. At the time of his DoD background interview, Applicant did not intend of turning himself in on

the warrant because he did not have $1,400 needed to be released from jail. Documentation provided by Applicant from the state division of child support enforcement dated June 25, 2021, shows that regarding Case #0003720431, Applicant has a current total balance owed of $18,859.42, with $16,256.02 owed to the parent custodian for support and $2,603 owed to the state. Applicant’s monthly child support payment is $490 which began in August 2016. (Government Exhibit 4.) Other documentation provided by Applicant from the state division of child support enforcement dated June 25, 2021, shows that regarding Case #0003583637, Applicant has a current total balance of $14,970.81, owed to the parent custodian and $196 owed to the state. His monthly payment is $339.23 which began in March 2013. There is no evidence in the record that shows that he has started making payments toward the debt yet. (Government Exhibit 4.) 1.b. A delinquent debt is owed to a creditor that was placed for collections in the approximate amount of $8,042. The debt remains owing. (Government Exhibits 5 and 6.) 1.c. A delinquent debt is owed to a creditor that was charged off in the approximate amount of $2,500. The debt remains owing. (Government Exhibits 5 and 6.) 1.d. A delinquent medical account was placed for collection in the approximate amount of $938. The debt remains owing. (Government Exhibits 5 and 6.) 1.e. A delinquent medical account was placed for collection in the approximate amount of $368. The debt remains owing. (Government Exhibits 5 and 6.) 1.f. A delinquent debt is owed to a creditor that was placed for collection in the approximate amount of $333. The debt remains owing. (Government Exhibits 5 and 6.) 1.g. A delinquent debt medical account was placed for collection in the approximate amount of $65. The debt remains owing. (Government Exhibits 5 and 6.) Applicant has failed to provide any evidence in mitigation. He has not made a good faith effort to address his delinquent debts nor has he taken any meaningful step to resolve the delinquencies. He has failed to show that he has made even one payment toward resolving his debts. Furthermore, he has failed to provide evidence showing that his current financial situation is under control and that there is no risk of recurrence of the financial problems at issue.

POLICIES

When evaluating an applicant’s suitability for a security clearance, 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 eligibility for access to classified information.

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. 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. Likewise, I have avoided drawing inferences grounded on mere speculation or conjecture. Under Directive ¶ E3.1.14, the government must present evidence to establish controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, 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.” The applicant has the ultimate burden of persuasion to obtain a favorable clearance decision. A person who seeks access to classified information enters 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 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 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 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. Two are potentially applicable in this case: (a) inability or unwillingness to satisfy debts; and (c) a history of not meeting financial obligations. Applicant is indebted to a number of creditors for delinquent accounts totaling in excess of $24,000 that have been placed for collection or are in arrears. The evidence is sufficient to raise the above disqualifying conditions. The following mitigating conditions under the Financial Considerations guideline are potentially applicable under AG ¶ 20: (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, or a death, divorce, or separation), and the individual acted responsibly under the circumstances; and

(d) the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts. Applicant is delinquently indebted to each of the creditors set forth in the SOR. He has failed to provide any evidence in mitigation. This shows poor judgment and unreliability. Accordingly, Applicant does not meet the requirements to access classified information.

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 relevant facts and circumstances surrounding this case. I conclude Applicant has not 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 Enclosure 3 of the Directive, are: Paragraph 1, Guideline F: AGAINST APPLICANT Subparagraphs 1.a. through 1.g: 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 or continue Applicant’s national security eligibility for a security clearance. Eligibility for access to classified information is denied. Darlene Lokey Anderson Administrative Judge