ISCR Case No. 22-00369

______________ ______________ DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS In the matter of: ) ) ) ISCR Case No. 22-00369 ) Applicant for Security Clearance ) Appearances For Government: Carroll J. Connelley, Esq., Department Counsel For Applicant: Pro se 07/20/2023

RICCIARDELLO, Carol G., Administrative Judge: Applicant failed to mitigate the security concerns under Guideline F, financial considerations. Eligibility for access to classified information is denied. Statement of the Case On August 31, 2022, the Department of Defense (DOD) issued to Applicant a Statement of Reasons (SOR) detailing security concerns under Guideline F, financial considerations. 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 adjudicative guidelines (AG) effective within the DOD on June 8, 2017. Applicant answered the SOR on December 29, 2022, and elected to have his case decided on the written record in lieu of a hearing. Department Counsel submitted the Government’s file of relevant material (FORM), and Applicant received it on February 13, 2023. He was afforded an opportunity to file objections and submit material in refutation,

extenuation, or mitigation within 30 days of receipt of the FORM. The Government’s evidence is identified as Items 1 through 8. Applicant did not provide a response to the FORM; did not object to the Government’s evidence, and did not submit documents. The Government evidence is admitted. The case was assigned to me on May 1, 2023.

Applicant admitted all of the SOR allegations, except ¶¶ 1.f, 1.p and 1.q, which he denied. After a thorough and careful review of the pleadings and exhibits submitted, I make the following findings of fact. Applicant is 34 years old. He completed high school and then earned an associate degree in 2016. He married in 2008 and has two children ages 11 and 12. He has a third child from another relationship. The age of the child is unknown. Applicant served in the military from 2007 until 2014. He received a discharge under other than honorable conditions. Applicant had two periods of unemployment. After his discharge he was unemployed for two months in 2014 and again from April 2017 to June 2017. He has worked for his present employer, a federal contractor, since May 2018. The SOR alleges 17 delinquent debts totaling approximately $45,722. Applicant’s admissions in his answer to the SOR, background interview, responses to government interrogatories, and credit reports from November 2018, January 2021, September 2021, and February 2022, corroborate the SOR allegations. (GE 1-8) Applicant completed a security clearance application (SCA) in August 2018. In it he disclosed he had delinquent debts and stated he called some debt collectors that appeared on his credit report to try and make payment arrangements and determine the balance he owed. He then explained he fell on hard times and could not make payments on his largest debt that is alleged in SOR ¶ 1.a. His interrogatory response to his largest debt was that it was not paid and no efforts had been made to make payment arrangements. (Items 2, 3, 4) Applicant also explained that he had fathered a child while he was separated from his wife and in the military. Two years later the mother of the child petitioned for child support. He explained he had been sending packages to the child every other month but the court did not recognize this as child support but rather were gifts. SOR ¶ 1.d ($4,884) is the amount alleged in arrears. His February 2022 credit report shows a balance of $3,067. Applicant did not respond to questions in his interrogatories about the status of his delinquent child support or provide any current documentation to support he has made subsequent efforts to pay the arrearages. (Items 2-8) During Applicant’s February 2019 background investigation interview, he acknowledged almost all of the debts. He explained he was in the process of resolving them. He said he was working with a credit repair company to help resolve his delinquent debts. In his response to interrogatories, Applicant provided documents that he resolved the debt in SOR ¶ 1.q. ($147) (GE 3)

In his SCA, Applicant stated that he did not have jobs that paid much after leaving the military. In response to government interrogatories, Applicant stated that he attributed his financial issues to being young, in the military, and he was unable to pay the debts and let them lapse. He is now working and has paid some debts. He did not provide any other evidence or documents that he has resolved any of the remaining debts in the SOR, has payment plans, contacted any of the creditors, or disputed any debts. (GE 4)

When evaluating an applicant’s suitability for national security eligibility, 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 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, these guidelines are applied in conjunction with the factors listed in the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. According to AG ¶ 2(c), 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. Directive ¶ E3.1.15 states an “applicant is responsible for presenting witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by applicant or proven by Department Counsel, and has the ultimate burden of persuasion as to obtaining a favorable security 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 that an 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 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).

Guideline F: Financial Considerations The security concern relating to the guideline 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. This concern is broader than the possibility that an individual might knowingly compromise classified information in order to raise money. It encompasses concerns about an individual’s self-control, judgment, and other qualities essential to protecting classified information. An individual 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). AG ¶ 19 provides conditions that could raise security concerns. The following are potentially applicable: (a) inability to satisfy debts; and (c) a history of not meeting financial obligations. Applicant had 17 delinquent debts that he has been aware of since at least 2018 that he was unable to pay. There is sufficient evidence to support the application of the above disqualifying conditions.

The guideline also includes conditions that could mitigate security concerns arising from financial difficulties. The following mitigating conditions under AG ¶ 20 are potentially applicable: (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. Applicant resolved the debt in SOR ¶ 1.q. AG ¶ 20(d) applies to that debt. He had two short periods of unemployment after his military discharge and was underemployed for a period. These conditions were beyond his control. For the full application of AG ¶ 20(b), Applicant must have acted responsibly under the circumstances. He has been working steadily for a federal contractor since May 2018. He did not provide evidence of any payments he may have made towards his remaining 16 debts that total more than $45,000. He stated he signed up for help from a credit repair company but did not provide any evidence of action taken to resolve any of the debts. No evidence was provided that supports he has a payment plan with the any of the creditors, or that he has taken any other responsible action to resolve his delinquent debts. AG ¶ 20(b) has minimal application .AG ¶ 20(c) also has minimal application because he has not offered any proof of financial counseling, and there are not clear indications that his financial problems are being resolved or under control. No other mitigating conditions are applicable.

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 the 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 the facts and circumstances surrounding this case. I have incorporated my comments under Guideline, F in my whole-person analysis. Applicant failed to meet his burden of persuasion. The record evidence leaves me with questions and doubts as to Applicant’s eligibility and suitability for a security clearance. For all these reasons, I conclude Applicant failed to mitigate the security concerns raised under Guideline F, financial considerations.

Formal findings for or against Applicant on the allegations set forth in the SOR, as required by section E3.1.25 of Enclosure 3 of the Directive, are: Paragraph 1, Guideline F: AGAINST APPLICANT Subparagraphs 1.a-1.p: Against Applicant Subparagraph 1.q: For Applicant

In light of all of the circumstances presented by the record in this case, it is not clearly consistent with the national security to grant Applicant’s eligibility for a security clearance. Eligibility for access to classified information is denied. Carol G. Ricciardello Administrative Judge