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ISCR Case 22-00026 — CASE

ISCR Case 22-00026denied

Case Headnote

ISCR Case No. 22-00026

deniedJun 8, 2023· Hon. LeRoy F. Foreman· hearing

Summary

A 22-year-old craftsman employed by a defense contractor was denied a security clearance under Guideline F (Financial Considerations) due to approximately $25,792 in delinquent medical debts. The Statement of Reasons alleged eight delinquent medical debts, all placed for collection, and a history of not meeting financial obligations. These issues raised disqualifying conditions under Adjudicative Guidelines Paragraphs 19(a), 19(b), and 19(c).

The applicant admitted to the delinquent medical debts, acknowledging the total amount. However, the denial was based on his failure to demonstrate responsible financial behavior or seek financial counseling.

Despite having the financial ability to resolve the debts, the applicant chose to ignore them. This lack of mitigating action and responsible financial management ultimately led to the denial of his security clearance.

Why the Applicant Was Denied

The applicant admitted to having delinquent medical debts totaling approximately $25,792.
He did not demonstrate responsible financial behavior or seek financial counseling.
The applicant has the financial ability to resolve the debts but chose to ignore them.

Conditions Referenced

Disqualifying

AG ¶ 19(a)appliedInability to Satisfy Debts
AG ¶ 19(b)appliedUnwillingness to Satisfy Debts Regardless of the Ability to Do So
AG ¶ 19(c)appliedA History of Not Meeting Financial Obligations

Key Rule Quoted

“Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the adjudicative guidelines.”

Procedural Posture

SOR issuedFeb 17, 2022
Answer filedMay 3, 2022
Hearing heldMay 2, 2023conducted by video teleconference
Decision dateJun 8, 2023

Cite For

Denial of Security Clearance Due to Financial Irresponsibility Under Guideline F
Failure to Mitigate Financial Concerns Despite Acknowledgment of Debts
Importance of Demonstrating Responsible Financial Behavior for Security Clearance 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: HearingDecided: denied

The judge found against the applicant on financial considerations due to eight delinquent medical debts totaling approximately $25,792 that had been placed for collection. The applicant admitted to the debts but failed to demonstrate sufficient mitigation of the financial concerns, leading to a denial of the security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	The SOR alleges eight delinquent medical debts totaling about $25,792 that have been placed for collection. $25,792	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.b	Applicant has a history of not meeting financial obligations.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.c–1.h	6 sub-charges — specific text not stated in this decision (against the applicant).	Against Applicant			—	—	—

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

______________ ______________ \\ EA c; ... o _.~ .t::~!~ o DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS In the matter of: )

)

[Redacted] )

ISCR Case No. 22-00026

) Applicant for Security Clearance ) For Government: Carroll J. Connelley, Esq., Department Counsel For Applicant: Pro se 06/08/2023

STATEMENT OF CASE

FOREMAN, LeRoy F., Administrative Judge: This case involves security concerns raised under Guideline F (Financial Considerations). Eligibility for access to classified information is denied. Statement of the Case Applicant submitted a security clearance application on December 14, 2020. On February 17, 2022, the Defense Counterintelligence and Security Agency Consolidated Adjudications Facility (CAF) sent him a Statement of Reasons (SOR) alleging security concerns under Guideline F. The CAF acted under Executive Order (Exec. Or.) 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 (AG) promulgated in Security Executive Agent Directive 4, National Security Adjudicative Guidelines (December 10, 2016). Applicant answered the SOR on May 3, 2022, and requested a hearing before an administrative judge. Department Counsel was ready to proceed on August 11, 2022, and the case was assigned to me on March 24, 2023. On April 26, 2023, the Defense Office

of Hearings and Appeals (DOHA) notified Applicant that the hearing was scheduled to be conducted by video teleconference on May 2, 2023. I convened the hearing as scheduled. Government Exhibits (GX) 1 through 5 were admitted in evidence without objection. Applicant testified but did not present the testimony of any other witnesses or submit any documentary evidence. I kept the record open until May 12, 2023, to enable him to submit documentary evidence. He timely submitted Applicant’s Exhibit (AX) A, which was admitted without objection. DOHA received the transcript (Tr.) on May 15, 2023.

FINDINGS OF FACT

In Applicant’s answer to the SOR, he admitted all the allegations. His admissions are incorporated in my findings of fact. Applicant is a 22-year-old craftsman employed by a defense contractor since July 2018. He graduated from high school in June 2018. He resided with a cohabitant from December 2018 until they married in July 2020. He has no children. He has never held a security clearance. (GX 1 at 7, 12, 17-18; Tr. 22) The SOR alleges eight delinquent medical debts totaling about $25,792 that have been placed for collection. The debts are reflected in credit reports from February 2021 and August 2022. (GX 4; GX 5) Applicant testified he suffers from an autoimmune disease and his body does not produce enough white blood cells. Until March 2020, he went to a hospital once a month for treatment. He lived with his parents until he was 18 years old, and he was covered by his father’s medical insurance. (Tr. 15-17) He now has medical insurance through his employer, but his white blood cell count is not low enough to be covered by his insurance. He stopped obtaining treatment in March 2020. (Tr. 21-22) When Applicant was interviewed by a security investigator in February 2021, he told the investigator that he was unaware of the medical debts. However, he also told the investigator that he had a payment plan providing for monthly $50 payments to the hospital where he received the treatments. (GX 2) At the hearing, he testified that he made one $50 payment to the collection agency in December 2020, but he had not made any further payments. When asked why he had not made any further payments, he responded: “There’s really no rhyme or reason. I just – because I looked at my credit one time and saw that I had been going up, even though those bills were in collections, I didn’t do anything about it and didn’t think twice about it.” He does not believe that the lack of a clearance will have any financial impact on his career. (Tr. 25-27) Applicant’s foreman considers him a proficient mechanic who has an exceptional work ethic and sometimes goes beyond his assignments. He states that Applicant needs a security clearance to be able to work as a pipefitter in restricted areas of submarines. (AX A)

POLICIES

“[N]o one has a ‘right’ to a security clearance.” Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). As Commander in Chief, the President has the authority to “control access to information bearing on national security and to determine whether an individual is sufficiently trustworthy to have access to such information.” Id. at 527. The President has authorized the Secretary of Defense or his designee to grant applicants eligibility for access to classified information “only upon a finding that it is clearly consistent with the national interest to do so.” Exec. Or. 10865 § 2. Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the adjudicative guidelines. These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, an administrative judge applies these guidelines in conjunction with an evaluation of the whole person. An administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. An administrative judge must consider all available and reliable information about the person, past and present, favorable and unfavorable. The Government reposes a high degree of trust and confidence in persons with access to classified information. This relationship transcends normal duty hours and endures throughout off-duty hours. Decisions include, by necessity, consideration of the possible risk that the applicant may deliberately or inadvertently fail to safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation about potential, rather than actual, risk of compromise of classified information. Clearance decisions must be made “in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.” Exec. Or. 10865 § 7. Thus, a decision to deny a security clearance is merely an indication the applicant has not met the strict guidelines the President and the Secretary of Defense have established for issuing a clearance. Initially, the Government must establish, by substantial evidence, conditions in the personal or professional history of the applicant that may disqualify the applicant from being eligible for access to classified information. The Government has the burden of establishing controverted facts alleged in the SOR. See Egan, 484 U.S. at 531. “Substantial evidence” is “more than a scintilla but less than a preponderance.” See v. Washington Metro. Area Transit Auth., 36 F.3d 375, 380 (4th Cir. 1994). The guidelines presume a nexus or rational connection between proven conduct under any of the criteria listed therein and an applicant’s security suitability. See ISCR Case No. 15-01253 at 3 (App. Bd. Apr. 20, 2016). Once the Government establishes a disqualifying condition by substantial evidence, the burden shifts to the applicant to rebut, explain, extenuate, or mitigate the facts. Directive ¶ E3.1.15. An applicant has the burden of proving a mitigating condition,

and the burden of disproving it never shifts to the Government. See ISCR Case No. 02 31154 at 5 (App. Bd. Sep. 22, 2005). An applicant “has the ultimate burden of demonstrating that it is clearly consistent with the national interest to grant or continue his security clearance.” ISCR Case No. 01 20700 at 3 (App. Bd. Dec. 19, 2002). “[S]ecurity clearance determinations should err, if they must, on the side of denials.” Egan, 484 U.S. at 531.

ANALYSIS

Guideline F, Financial Considerations The security concern under this guideline 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. . . . An individual who is financially overextended is at greater risk of having to engage in illegal or otherwise questionable acts to generate funds. . . . This concern is broader than the possibility that a person might knowingly compromise classified information to raise money. It encompasses concerns about a person’s self-control, judgment, and other qualities essential to protecting classified information. A person who is financially irresponsible may also be irresponsible, unconcerned, or negligent in handling and safeguarding classified information. See ISCR Case No. 11-05365 at 3 (App. Bd. May 1, 2012). Applicant’s admissions, his testimony at the hearing, and the evidence submitted by Department Counsel at the hearing establish the following disqualifying conditions under this guideline: AG ¶ 19(a): inability to satisfy debts; AG ¶ 19(b): unwillingness to satisfy debts regardless of the ability to do so; and AG ¶ 19(c): a history of not meeting financial obligations. The following mitigating conditions are relevant: 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;

AG ¶ 20(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; AG ¶ 20(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; AG ¶ 20(d): the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts; and AG ¶ 20(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 the above conditions are established. Applicant’s debts are recent, numerous, and were not incurred under circumstances making recurrence unlikely. While his autoimmune disease is a condition beyond his control, he has not acted responsibly to address the medical debts that resulted from his treatment. He has not sought or received financial counseling. He has not disputed any of the debts. He has the financial ability to resolve the debts but has chosen to ignore them.

WHOLE PERSON CONCEPT

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. In applying the whole- person concept, an 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. An 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.

I have incorporated my comments under Guideline F in my whole-person analysis and applied the adjudicative factors in AG ¶ 2(d). Applicant was candid and sincere at the hearing, but he appears to lack the maturity and sense of responsibility expected of persons entrusted with access to classified information. After weighing the disqualifying and mitigating conditions under Guideline F, and evaluating all the evidence in the context of the whole person, I conclude Applicant has not mitigated the security concerns raised by his delinquent debts.

FORMAL FINDINGS

I make the following formal findings on the allegations in the SOR: Paragraph 1, Guideline F (Financial Considerations): AGAINST APPLICANT Subparagraphs 1.a-1.h: Against Applicant

CONCLUSION

I conclude that it is not clearly consistent with the national security interests of the United States to grant Applicant eligibility for access to classified information. Clearance is denied. LeRoy F. Foreman Administrative Judge