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ISCR Case 22-01400 — CASE

ISCR Case 22-01400denied

Case Headnote

ISCR Case No. 22-01400

deniedNov 20, 2023· Hon. Nichole L. Noel· hearing

Summary

A 32-year-old security officer was denied a security clearance under Guideline F (Financial Considerations) due to unresolved debts totaling $20,430. The Statement of Reasons detailed several specific financial obligations: $488 for a current cell phone debt, $1,267 across two older cell phone accounts, $3,459 for a deficiency balance on his own car loan, and $7,332 for a deficiency balance on his father's car loan. Additionally, he owed $8,303 on five other accounts.

The decision acknowledged that the applicant's financial difficulties stemmed from circumstances beyond his control, aligning with Mitigating Condition AG ¶ 20(b). However, the Disqualifying Conditions AG ¶ 19(a) and AG ¶ 19(c) were raised because he failed to provide sufficient evidence of responsible actions taken to address these concerns.

Ultimately, the clearance was denied because the applicant did not demonstrate debt repayment or that he acted responsibly given his financial situation. The unresolved delinquent debts were deemed to raise significant security concerns regarding his reliability and trustworthiness.

Why the Applicant Was Denied

The applicant did not provide evidence of debt repayment or that he acted responsibly under the circumstances of his financial difficulties.
Unresolved delinquent debts raised significant security concerns regarding the applicant's reliability and trustworthiness.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability to Satisfy Debts
AG ¶ 19(c)raisedHistory of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(b)appliedConditions Beyond the Person's ControlThe applicant's financial problems were caused by job insecurity, the death of his father, and a medical emergency of his girlfriend.

Key Rule Quoted

“Unresolved delinquent debt is a serious security concern because failure to satisfy debts [or] 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 issuedNov 7, 2022
Answer filed—Applicant requested a decision without a hearing.
Hearing held—Decision made without a hearing.
Decision dateNov 20, 2023

Cite For

Denial of Security Clearance Due to Unresolved Financial Issues Under Guideline F
Importance of Providing Evidence of Responsible Actions in Mitigating Financial Concerns
Impact of Financial Instability on 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: Decision on RecordDecided: denied

The judge found against the applicant on all financial allegations under Guideline F, citing a total indebtedness of $20,430 across multiple accounts. Although the applicant claimed that some financial issues were beyond his control, the judge concluded that he did not provide sufficient evidence to mitigate the concerns raised.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant owed $488 on a cell phone debt. $488	Against Applicant	Utility or Phone Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Applicant owed $1,267 on two old cell phone accounts. $1,267	Against Applicant	Utility or Phone Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	Applicant owed $3,459 for a deficiency balance on a car loan. $3,459	Against Applicant	Auto Loan Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	Applicant owed $7,332 for a deficiency balance on his father's car loan. $7,332	Against Applicant	Auto Loan Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	Applicant owed $8,303 on five other accounts. $8,303	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—

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

\\F~/. Ci r.. o _.,~ nr,~~ > 'tr ______________ ______________ DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS ' In the matter of: ) ) ) ISCR Case No. 22-01400 ) Applicant for Security Clearance ) Appearances For Government: Nicholas T. Temple, Esq., Department Counsel For Applicant: Pro se 11/20/2023

STATEMENT OF CASE

NOEL, Nichole L., Administrative Judge: Applicant contests the Department of Defense’s (DOD) intent to deny his eligibility for a security clearance. Although Applicant’s financial problems were caused by events beyond his control, he did not present sufficient evidence to mitigate the financial considerations concerns. Clearance is denied. Statement of the Case On November 7, 2022, the DOD issued a Statement of Reasons (SOR) detailing security concerns under the financial considerations guideline. This action was taken under Executive Order (EO) 10865, Safeguarding Classified Information within Industry, signed by President Eisenhower on February 20, 1960, as amended, as well as DOD Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program, dated 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, implemented on June 8, 2017. DOD adjudicators were unable

to find that it is clearly consistent with the national interest to grant Applicant’s security clearance. Applicant answered the SOR and requested a decision without a hearing. The Government submitted its written case on April 4, 2023. The Government provided Applicant a complete copy of the file of relevant material (FORM) and the Directive. In the FORM, the Government informed Applicant that it was offering a summary of his February 2022 subject interview with a background investigator into evidence. The Government advised him of his ability to object to, correct, add, delete, or update the information in the subject interview summary. The Government further advised him that failure to respond could result in a determination by the administrative judge that he waived any objection to the document’s admissibility. Applicant acknowledged receipt of the documents on April 12, 2023. He did not respond. The attachments to the FORM, which include the summary, are admitted to the record as Government’s Exhibits (GE) 1 through 7, without objection.

FINDINGS OF FACT

Applicant, 32, has worked for his current employer as a security officer since October 2021. He completed a security application, his first, in December 2021, disclosing two delinquent debts, totaling $10,300. The investigation revealed eight additional delinquent accounts. The SOR alleged that Applicant owed $20,430 on 10 delinquent accounts. (GE 1,3) Applicant started having financial problems after experiencing what he described as ‘job insecurity,’ after being laid off in July 2020. Between July 2020 and October 2021, he worked at four different security companies, with the jobs lasting between 2 and 8 months. During the summer of 2020, his finances were strained by the death of his father. Also, his girlfriend, with whom he had been living and sharing household expenses since May 2020, experienced a medical emergency that left her unable to work for an unspecified period. The record does not contain specific information about Applicant’s income or expenses during that time. (GE 7) Applicant discussed his finances with a background investigator during a February 2022 interview. He discussed the two debts he disclosed in his security clearance application, both for the deficiency balance on car loans. After being laid off in July 2020, Applicant could not afford his car payment, which resulted in the vehicle being repossessed and a deficiency balance on the loan. (SOR ¶ 1.f, $3,459) Unbeknownst to Applicant until after the death of his father, his father’s car, for which Applicant had cosigned, had also been repossessed and had a deficiency balance due. (SOR ¶ 1.e, $7332) At the time of the interview, he had not made any payments on either of these debts. (GE 7) The investigator confronted Applicant with evidence of eight additional debts reported in a January 2022 credit report. (GE 4) He admitted owing debts on two old cell phone accounts totaling $1,267 (SOR ¶¶ 1.band 1.g). He also attributed a $69 debt

(SOR ¶ 1.j) to medical treatment he received. He told the investigator he had no knowledge of the other five accounts totaling $8,303. (SOR ¶¶ 1.b, 1.c, 1.d, 1.h, 1.i) In his answer to the SOR, Applicant denied SOR ¶ 1.a ($488), one of the cell phone debts he admitted owing in the February 2022 subject interview. He admitted SOR ¶¶ 1.bthrough 1.j. All the debts appear on GE 4, a January 20, 2022 credit report. For unknown reasons, only the debts alleged in SOR ¶¶ 1.e through 1.gappear on GE 5, an August 30, 2023 credit report. The most recent credit report, GE 6, dated April 4, 2023, only reports the debts alleged in SOR ¶¶ 1.e and 1.f. Applicant did not provide any evidence of debt repayment. None of the alleged debts are over seven years old. The alleged debts became delinquent between 2020 and 2022. There is no evidence that Applicant has challenged the information reported on his credit reports as being inaccurate or erroneous.

POLICIES

When evaluating an applicant’s suitability for a security clearance, the administrative judge must consider the adjudicative guidelines. 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. 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. 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. 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

Unresolved delinquent debt is a serious security concern because failure to “satisfy debts [or] 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.” (AG ¶ 18). Here, the SOR alleged and the record supports a finding that Applicant is indebted to 10 creditors for $20,430. The Government has established its prima facie case that certain of the financial considerations apply, specifically: AG ¶ 19(a) inability to satisfy debts; and AG ¶ 19(c) a history of not meeting financial obligations. The following mitigating condition is partially applicable, but does not fully mitigate the alleged concerns: AG ¶ 20(b) the conditions that resulted in the financial problem were largely beyond the person’s control (e.g., loss of unemployment, 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. The record contains sufficient evidence to establish that Applicant’s financial problems were caused by events beyond his control: job insecurity between July 2020 and October 2021; the death of his father; and the loss of household income due to an unexpected medical issue experienced by his cohabitant girlfriend. However, he did not submit evidence to satisfy the second part of the mitigation condition that he acted responsibly under the circumstances. He did not provide any evidence that he has paid or successfully challenged the alleged debts. He also failed to provide evidence that he is no longer responsible for the debts either by cancellation by the creditors or application of the statute of limitations. He did not present any evidence to show that his finances are under control. Based on the record, doubts remain about Applicant’s current security worthiness. In reaching this conclusion, I have also considered the whole-person factors at AG ¶ 2(d). Although, security clearance adjudications are not debt-collection proceedings, an applicant is responsible for providing sufficient evidence to explain, refute, or rebut the SOR allegations. Applicant failed to meet his burdens of production and persuasion.

________________________

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, Financial Considerations: AGAINST APPLICANT Subparagraphs 1.a – 1.j: Against Applicant

CONCLUSION

Based on the record, it is not clearly consistent with the national interest to grant Applicant eligibility for a security clearance. National security eligibility for access to classified information is denied. Nichole L. Noel Administrative Judge