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ISCR Case 22-01624 — CASE

ISCR Case 22-01624denied

Case Headnote

ISCR Case No. 22-01624

deniedSep 6, 2023· Hon. Benjamin R. Dorsey· hearing

Summary

A 27-year-old government contractor was denied a security clearance under Guideline F, Financial Considerations, due to unresolved financial issues. The Statement of Reasons (SOR) alleged six delinquent debts totaling approximately $56,000. These debts included unpaid rental obligations, a cable debt, unpaid tuition, and a personal loan, with car loans accounting for about $53,000 of the total SOR indebtedness. The SOR further noted that the applicant had not provided sufficient evidence of resolving or actively addressing these debts, and that the financial delinquencies were both recent and ongoing.

The applicant admitted to the debts but failed to provide corroborating evidence that they had been satisfied or that payment plans were in place. The judge determined that the applicant did not mitigate the financial concerns, specifically citing the lack of evidence for debt resolution or payment plans, and the recent and ongoing nature of the delinquencies.

Consequently, the applicant was found ineligible for access to classified information, and the security clearance was denied.

Why the Applicant Was Denied

The applicant had six delinquent debts totaling approximately $56,000, which he admitted to but did not resolve.
He failed to provide corroborating evidence of debt resolution or payment plans.
The applicant's financial delinquencies were recent and ongoing, indicating a lack of financial responsibility.

Conditions Referenced

Disqualifying

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

Key Rule Quoted

“The protection of the national security is the paramount consideration.”

Procedural Posture

SOR issuedNov 21, 2022
Answer filedMar 13, 2023Requested decision based on written record.
Hearing held—Decision made without a hearing.
Decision dateSep 6, 2023

Cite For

Denial of Security Clearance Due to Unresolved Financial Issues Under Guideline F
Importance of Corroborating Evidence in Financial Mitigation
Impact of Recent and Ongoing Financial Delinquencies 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 applicant has six delinquent debts totaling approximately $56,000, which include unpaid rental obligations, a cable debt, unpaid tuition, and a personal loan. The judge found that the applicant did not provide sufficient evidence to resolve these debts or demonstrate financial responsibility, leading to a decision against the applicant on all allegations under Guideline F.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant has six delinquent debts totaling approximately $56,000. $56,000	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.b	Delinquent debts include unpaid rental obligations, a cable debt, unpaid tuition, and a personal loan.	Against Applicant	Unspecified Financial	Admitted	—	—	Claimed Debt Disputed with Creditor
1.c	The car loans comprise about $53,000 of the $56,000 total SOR indebtedness. $53,000	Against Applicant	Auto Loan Debt	Admitted	—	—	Claimed Debt Paid in Full
1.d	Applicant did not provide sufficient evidence that he has resolved or is resolving his SOR debts.	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.e	Applicant's financial delinquencies are recent and ongoing.	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.f	Applicant failed to provide sufficient evidence that any of the mitigating conditions apply.	Against Applicant	Unspecified Financial	Unknown	—	—	—

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. 22-01624 ) Applicant for Security Clearance ) Appearances For Government: Sakeena Farhath, Esq., Department Counsel For Applicant: Pro se 09/06/2023

STATEMENT OF CASE

Dorsey, Benjamin R., Administrative Judge: Applicant did not mitigate the financial considerations security concerns. Eligibility for access to classified information is denied. Statement of the Case On November 21, 2022, the Department of Defense (DOD) issued a Statement of Reasons (SOR) to Applicant detailing security concerns under Guideline F, financial considerations. He responded to the SOR on March 13, 2023, and requested a decision based on the written record in lieu of a hearing. The Government submitted its written case on April 28, 2023. A complete copy of the file of relevant material (FORM) was provided to Applicant, who was advised that he had 30 days from his date of receipt to file objections and submit material to refute, extenuate, or mitigate the security concerns. Applicant received the FORM on May 7, 2023, and he did not respond within the deadline. The case was assigned to me on August 26, 2023. The Government exhibits included in the FORM, marked as Items 1 through 7, are admitted in evidence without objection.

FINDINGS OF FACT

Applicant is a 27-year-old employee of a government contractor for whom he has worked since July 2020. He earned a high school diploma in June 2014 and has taken some undergraduate courses but has not earned a degree or certificate. He is twice divorced, having been married for three months in 2016 and for nine months in 2017. He remarried in January 2018. He has three children and a stepchild. He served with the Navy from 2014 until 2019, when he earned an honorable discharge. (Items 3, 7) In the SOR, the Government alleged Applicant’s six delinquent debts totaling approximately $56,000 (SOR ¶¶ 1.a through 1.f). These delinquencies consist of car loans (SOR ¶¶ 1.a and 1.e), unpaid rental obligations (SOR ¶ 1.b), a cable debt (SOR ¶ 1.c), unpaid tuition (SOR ¶ 1.d), and a personal loan (SOR ¶ 1.f). The car loans comprise about $53,000 of the $56,000 total SOR indebtedness. He admitted the SOR allegations with additional comments. His admissions are adopted as findings of fact. The SOR allegations are established through his admissions and the Government’s credit reports. The SOR debts became delinquent between 2018 and 2021. (Items 3-7) In Applicant’s March 2023 response to the SOR, he claimed that he satisfied the debts in SOR ¶¶ 1.c, 1.d., and 1.f. on unspecified dates. He claimed he is making payments on the debt in SOR ¶ 1.b. He further claimed that the car loan in SOR ¶ 1.a is “closed,” and that he will attempt to make payment arrangements on the car loan in SOR ¶ 1.e. He failed to provide any documentary corroboration that he contacted the lenders, set up any payment plans for his SOR debts, or paid any of the accounts. Contrary to department counsel’s assertion that Item 4 provides proof that there is no balance on the debts in SOR ¶¶ 1.a and 1.c, I find that Item does not support her statement. Applicant did not respond to the FORM, so more recent information about his finances is not available. Given the lack of corroborating evidence, I find that the SOR debts remain unresolved. (Items 3-7) Applicant became delinquent on the SOR debts because he borrowed more money than he could afford to repay. While he did not explicitly offer his divorces as a basis for his financial issues, they presumably played a role. He claimed that he earns enough income each month to pay his financial obligations. The evidence shows that he has resolved other delinquent accounts in the past, but it also shows that he is behind on four debts that were not included in the SOR. He provided no evidence that he has undergone financial counseling. (Items 4, 7)

POLICIES

This case is adjudicated 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), which became effective within DOD on June 8, 2017.

When evaluating an applicant’s suitability for a security clearance, the administrative judge must consider the adjudicative guidelines. 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 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.” 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 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 the applicant may deliberately or inadvertently fail to safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation of 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. The guideline notes several conditions that could raise security concerns under AG ¶ 19. The following are potentially applicable in this case: (a) inability to satisfy debts; and (c) a history of not meeting financial obligations. Applicant has six delinquent debts totaling about $56,000, many of which are several years old. The above disqualifying conditions are raised. Conditions that could mitigate the financial considerations security concerns are provided under AG ¶ 20. The following 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; and (d) the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts. Applicant’s financial delinquencies are recent and ongoing. He has not provided sufficient evidence that he has resolved or is resolving his SOR debts. It is reasonable to expect Applicant to present documentation about the resolution of specific debts, but he has not. See, e.g., ISCR Case No. 15-03363 at 2 (App. Bd. Oct. 16, 2016). He has additional debts that he is behind on that were not listed in the SOR. He has not established a track record of financial responsibility. AG ¶ 20(a) does not apply. Applicant’s delinquencies were caused by overspending and his divorces also likely had an impact. His overspending was not beyond his control. His divorces can be

seen as being beyond his control. Regardless, because he has not provided sufficient evidence that he has attempted to resolve his debts, he has not shown that he acted responsibly under the circumstances with respect to these debts. AG ¶ 20(b) does not apply. The lack of evidence of resolution of his SOR debts also means that AG ¶ 20(d) does not apply. He failed to provide sufficient evidence that any of the mitigating conditions apply.

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 the facts and circumstances surrounding this case. I have incorporated my comments under Guideline F in my whole-person analysis. I have also considered Applicant’s military service. Overall, the record evidence leaves me with questions and doubts about Applicant’s eligibility and suitability for a security clearance. I conclude Applicant did not mitigate the financial considerations security concern.

FORMAL FINDINGS

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.f: Against Applicant

________________________

CONCLUSION

It is not clearly consistent with the national interest to grant Applicant eligibility for a security clearance. Eligibility for access to classified information is denied. Benjamin R. Dorsey Administrative Judge