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ISCR Case 23-00551 — CASE

ISCR Case 23-00551denied

Case Headnote

ISCR Case No. 23-00551

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

Summary

A 32-year-old data scientist was denied eligibility for access to classified information under Guideline F (Financial Considerations) due to delinquent debts totaling $13,863. The Statement of Reasons detailed three specific credit card accounts that were charged off. One account, with a last payment in August 2018, was for $2,724. The other two accounts, both with last payments in April 2017, were for $5,602 and $5,537, respectively.

The applicant admitted to all allegations concerning these debts and acknowledged making poor financial decisions. Disqualifying conditions under Guideline F were raised, specifically AG ¶ 19(a), AG ¶ 19(b), and AG ¶ 19(c).

Despite a significant increase in income, the applicant failed to provide any evidence of efforts to resolve these outstanding debts. The decision highlighted that the financial problems were numerous and recent, with no indications of resolution, leading to the denial.

Why the Applicant Was Denied

The applicant admitted to all allegations of delinquent debts totaling $13,863.
The applicant did not provide evidence of efforts to resolve the debts after a significant increase in income.
The applicant's financial problems were numerous and recent, with no indications of resolution.

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 issuedApr 12, 2023
Answer filedJun 6, 2023
Hearing held—Applicant requested a decision on the written record without a hearing.
Decision dateDec 8, 2023

Cite For

Denial of Security Clearance Due to Unresolved Financial Obligations
Failure to Demonstrate Good-faith Efforts to Resolve Debts
Impact of Financial Irresponsibility 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 history of delinquent debts totaling over $13,000 across three charged-off credit card accounts. The applicant's claims of increased income and financial counseling were not sufficient to mitigate the concerns raised by the outstanding debts.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	SOR ¶ 1.a alleges a credit-card account that was charged off for $2,724. The last payment on this account was in August 2018. $2,724	Against Applicant	Credit Card 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	SOR ¶ 1.b alleges a credit-card account that was charged off for $5,602. The last payment on this account was in April 2017. $5,602	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.c	SOR ¶ 1.c alleges a credit-card account that was charged off for $5,537. The last payment on this account was in April 2017. $5,537	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (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

EA c; ... o _.~ .t::~! ~ o ______________ ______________ DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS \\ In the matter of: ) ) ) ISCR Case No. 23-00551 ) Applicant for Security Clearance ) Appearances For Government: William H. Miller, Esq., Department Counsel For Applicant: Pro se 12/08/2023

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 (SCA) on September 16, 2022. On April 12, 2023, the Defense Counterintelligence and Security Agency Consolidated Adjudications Service (DCSA CAS) sent him a Statement of Reasons (SOR) alleging security concerns under Guideline F. The CAS acted under Executive Order (Exec. Or.) 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended; Department of Defense (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 June 6, 2023, and requested a decision on the written record without a hearing. Department Counsel submitted the Government’s written case on July 21, 2023. On July 26, 2023, a complete copy of the file of relevant material

(FORM) was sent to Applicant, who was given an opportunity to file objections and submit material to refute, extenuate, or mitigate the Government’s evidence. He received the FORM on August 9, 2023, but did not respond. The case was assigned to me on November 9, 2023. Evidentiary Issue The FORM included summaries of personal subject interviews conducted on October 13, 2022; October 17, 2022; November 1, 2022; November 3, 2022; and December 7, 2022. The summaries were not authenticated as required by Directive ¶ E3.1.20. Department Counsel informed Applicant that he was entitled to comment on the accuracy of the summaries; make any corrections, additions, deletions, or updates; or object to consideration of the summaries on the ground that they were not authenticated. I conclude that he waived any objections to the summaries by failing to respond to the FORM. Although pro se applicants are not expected to act like lawyers, they are expected to take timely and reasonable steps to protect their rights under the Directive. ISCR Case No. 12-10810 at 2 (App. Bd. Jul. 12, 2016). See ADP Case No. 17-03252 (App. Bd. Aug. 13, 2018)

FINDINGS OF FACT

In Applicant’s answer to the SOR, he admitted all the allegations in the SOR. His admissions are incorporated in my findings of fact. Applicant is a 32-year-old data scientist employed by a defense contractor since September 2022. He was employed in non-government jobs from February 2010 until he was hired by his current employer. He attended a university from September 2009 to March 2012 but did not receive a degree. He has never married and has no children. He has never held a security clearance. The SOR alleges the following three delinquent debts, reflected in a credit bureau report dated April 4, 2023: • SOR ¶ 1.a alleges a credit-card account that was charged off for $2,724. The last payment on this account was in August 2018. (FORM Item 5 at 3)1 • SOR ¶ 1.balleges a credit-card account that was charged off for $5,602. The last payment on this account was in April 2017. (FORM Item 5 at 7) • SOR ¶ 1.calleges a credit-card account that was charged off for $5,537. The last payment on this account was in April 2017. (FORM Item 5 at 8) When Applicant was interviewed by a security investigator in October 2022, he admitted that he had taken no action to resolve the debts alleged in the SOR. (FORM 1 The page numbering of FORM Item 5 begins with page 3.

Item 6 at 8) In his answer to the SOR, he admitted that he made poor financial decisions and allowed himself to be trapped in high-limit credit-card accounts. He stated that his income had tripled in the last eight months preceding his receipt of the SOR, going from $40,000 per year to $120,000 per year. He also stated that his credit advisor had advised him to wait until he made a down payment on a home before beginning to pay off his delinquent debts. He has followed the advisor’s advice. The record does not reflect the credentials or qualifications of his credit advisor. When Applicant submitted his SCA, he disclosed that he had traveled overseas as a tourist in December 2017, July 2017, December 2018, and April 2019. (FORM Item 3 at 29-39) He did not explain how he financed these trips, which occurred after he stopped making payments on the delinquent debts alleged in SOR ¶¶ 1.band 1.cand before he experienced his significant increase in income.

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 and the evidence in the FORM 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; and AG ¶ 20(d): the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts. None of these mitigating conditions are established. Applicant’s delinquent debts are numerous, recent, and were not incurred under circumstances making them unlikely to recur. He attributed his financial problems to low income, but he submitted no evidence of reasonable actions to resolve his debts after his income substantially increased. He appears to have received financial counseling, but he provided no evidence of the qualifications of his financial advisor, and there are no indications that his financial problems are being resolved. He has not disputed any of the debts, and he submitted no evidence of efforts to resolve 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). Because Applicant requested a determination on the record without a hearing, I had no opportunity to question him or evaluate his credibility and sincerity based on demeanor. See ISCR Case No. 01-12350 at 3-4 (App. Bd. Jul. 23, 2003). 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.c: 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