CASE · Clearance Adjudication Search EngineCASE

Loading case…

ISCR Case 16-02037.h1 — CASE

ISCR Case 16-02037.h1denied

Case Headnote

ISCR Case No. 16-02037.h1

deniedOct 4, 2017· Hon. Carol G. Ricciardello· hearing

Summary

A 59-year-old applicant with an associate's degree was denied a security clearance due to concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The applicant faced scrutiny for 18 delinquent debts, including student loans, medical debts, and judgments filed between 2011 and 2013.

Specifically, the applicant had three student loans in collection, six past-due student loans, and four medical debts in collection. Additionally, four judgments were entered against the applicant. The applicant admitted to these debts but failed to provide evidence of addressing them.

Furthermore, the applicant deliberately failed to disclose these judgments and collection accounts on the security clearance application, later admitting to falsifying the application. This omission was deemed a lack of candor, and the applicant's explanations for failing to disclose the debts were found not credible. Consequently, the security clearance was denied.

Why the Applicant Was Denied

The applicant admitted to 18 delinquent debts and failed to provide evidence of addressing them.
The applicant deliberately omitted relevant financial information from his security clearance application, which was deemed a lack of candor.
The applicant's explanations for failing to disclose debts were found not credible.

Conditions Referenced

Disqualifying

F1raisedInability to Satisfy Debts
F2raisedUnwillingness to Satisfy Debts
E2appliedDeliberate Omission, Concealment, or Falsification

Key Rule Quoted

“Any doubt concerning personnel being considered for national security eligibility will be resolved in favor of the national security.”

Procedural Posture

SOR issuedSep 8, 2016
Answer filedSep 20, 2016Applicant elected to proceed without a hearing.
Decision dateOct 4, 2017

Cite For

Failure to Disclose Financial Obligations Under Guideline E
Deliberate Omission of Relevant Facts in Security Clearance Applications
Ongoing Financial Issues as a Disqualifying Factor Under Guideline F

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 E (Personal Conduct) · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The judge found against the applicant on personal conduct allegations under Guideline E. The applicant deliberately failed to disclose relevant financial information on his security clearance application, which raised concerns about his reliability and trustworthiness.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a	Applicant deliberately failed to disclose judgments entered against him and his collection accounts on his security clearance application.	Against Applicant	Falsification Security FormFOUND DELIBERATE	Financial	Admitted	(a) deliberate omission, concealment, or falsification on a security form	—	—
2.b	Applicant admitted in his SOR answer that he falsified his security clearance application when he failed to disclose his judgments and collection accounts.	Against Applicant	Falsification Security FormFOUND DELIBERATE	Financial	Admitted	(a) deliberate omission, concealment, or falsification on a security form	—	—

Descriptive standardized rendering of a decided public case (Guideline E). The verbatim source decision is shown in full below.

Standardized Decision Profile

SEAD-4 Guideline F · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The applicant faced multiple financial concerns under Guideline F, including numerous delinquent debts and judgments. The judge found against the applicant on all allegations, concluding that the applicant failed to provide sufficient evidence of resolving these debts or acting responsibly, leading to a denial of security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Three are student loans in collection $29,250	Against Applicant	Student Loan Debt	Admitted	—	—	—
1.b	Three are student loans in collection $7,863	Against Applicant	Student Loan Debt	Admitted	—	—	—
1.c	Six are past-due student loans	Against Applicant	Student Loan Debt	Admitted	—	—	—
1.d	Six are past-due student loans	Against Applicant	Student Loan Debt	Admitted	—	—	—
1.e	Six are past-due student loans	Against Applicant	Student Loan Debt	Admitted	—	—	—
1.f	Six are past-due student loans	Against Applicant	Student Loan Debt	Admitted	—	—	—
1.g	Six are past-due student loans	Against Applicant	Student Loan Debt	Admitted	—	—	—
1.h–1.i	2 sub-charges — specific text not stated in this decision (against the applicant). (low confidence)	Against Applicant			—	—	—
1.j	Four are medical debts in collection $128	Against Applicant	Medical Debt	Admitted	—	—	—
1.k	Four are medical debts in collection $50	Against Applicant	Medical Debt	Admitted	—	—	—
1.l	Four are judgments filed between 2011 and 2013 $5,205	Against Applicant	Judgment Against Applicant	Admitted	—	—	—
1.m	Four are judgments filed between 2011 and 2013 $1,045	Against Applicant	Judgment Against Applicant	Admitted	—	—	—
1.n	Four are judgments filed between 2011 and 2013 $2,088	Against Applicant	Judgment Against Applicant	Admitted	—	—	—
1.o	Four are judgments filed between 2011 and 2013 $426	Against Applicant	Judgment Against Applicant	Admitted	—	—	—
1.p	Three are student loans in collection $5,924	Against Applicant	Student Loan Debt	Admitted	—	—	—
1.q	Four are medical debts in collection $198	Against Applicant	Medical Debt	Admitted	—	—	—
1.r	Four are medical debts in collection $50	Against Applicant	Medical Debt	Admitted	—	—	—

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. 16-02037 ) ) Applicant for Security Clearance

For Government: Tovah Minster, Esq., Department Counsel For Applicant: Pro se

10/04/2017 ______________

STATEMENT OF CASE

______________

RICCIARDELLO, Carol G., Administrative Judge:

Applicant failed to mitigate the security concerns under Guideline F, financial considerations, and Guideline E, personal conduct. Eligibility for access to classified information is denied.

Statement of the Case

On September 8, 2016, the Department of Defense Consolidated Adjudications Facility (DOD CAF) issued to Applicant a Statement of Reasons (SOR) detailing security concerns under Guideline F, financial considerations, and Guideline E, personal conduct. 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 September 1, 2006. On June 8, 2017, new AG were implemented and are effective for decisions issued after that date. Applicant answered the SOR on September 20, 2016, 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). Applicant received it on October 20, 2016. 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 5. Applicant did not provide a response to the FORM, object to the Government’s evidence, or submit documents. Items 1 through 5 are admitted into evidence. The case was assigned to me on October 1, 2017.

FINDINGS OF FACT

Applicant admitted all the allegations in the SOR. After a thorough and careful review of the pleadings and exhibits submitted, I make the following findings of fact.

Applicant is 59 years old. He earned an associate’s degree in 2000. He never married, but is in a relationship and has cohabitated since April 2014. He has no children. He has worked for his present employer since May 2015 and does not list any periods of unemployment on his 2015 security clearance application (SCA)1.

The SOR alleges 18 delinquent debts. Three are student loans in collection (SOR ¶¶ 1.a-$29,250; 1.b-$7,863; 1.p-$5,924); six are past-due student loans (SOR ¶¶ 1.c, 1.d, 1.e, 1.f, 1.g, and 1.i); four are medical debts in collection (SOR ¶¶ 1.j-$128; 1.k-$50; 1.q- $198; and 1.r-$50); one is a consumer debt in collection (SOR ¶ 1.j-$936); and four are judgments filed between 2011 and 2013 (SOR ¶¶ 1.l-$5,205; 1.m-$1045; 1.n-$2,088; and 1.o-$426).2 Applicant did not disclose any of those delinquent debts, past-due student loans, or judgments on his SCA. Credit reports from May 2016, August 2015, and Applicant’s admissions substantiate the debts alleged in the SOR.3

In March 2016, Applicant was interviewed by a government investigator. He explained he attended college online full-time at night. He had difficulty paying his student loans when they became due and paying other expenses. He told the investigator that he had paid off some student loans, had consolidated others, and was making payments on some. He told the investigator that he did not disclose on his SCA his past-due student loans because he was addressing them.4

Applicant acknowledged to the investigator that he had medical bills in collection. He stated that he was currently making payments on them. He told the investigator he did not disclose these debts on his SCA because he was addressing them and did not think that he needed to list them.5

Applicant disclosed he had judgments entered against him because of damages to a residence he rented that was caused by his dog. He was unable to pay the damages. He told the investigator that in approximately February 2016 his pay was garnished to pay for the damages. He did not disclose these judgments because he was addressing them. He also had a judgment entered against him in 2013 for an unpaid car loan (SOR ¶ 1.l). He purchased the vehicle and was unable to work for a number of days, and he subsequently returned the car to the creditor. He acknowledged he was aware he still owed money on the delinquent debt. He stated he was currently addressing the issue to establish a repayment schedule. He stated he failed to disclose this debt on his SCA because he was addressing it and he did think he needed to list it.6

Applicant told the investigator that he was unaware of the delinquent collection account in SOR ¶ 1.h, but would contact the creditor and address it.7

Applicant admitted all of the SOR debts and judgments. He told the investigator that he was addressing most of the alleged debts, including the judgments, but he did not provide documents to support his statements. He did not provide proof he has paid or resolved any of the SOR debts. He was aware of judgments entered against him for damage to property he rented. He was aware of the judgment entered against him for the defaulted car loan that is not paid. I do not find Applicant’s explanation credible that he did not believe he had to list any of the judgments because he was “addressing” them. There is no proof he was or is “addressing” them. Applicant admitted he was aware he had medical debts in collection, but stated he was addressing them, so he did not disclose them. Applicant provided no documentary proof that he was or is paying these debts. I find his explanation for failing to disclose his medical collections accounts is not credible. I find he deliberately failed to disclose judgments entered against him and his collection accounts. Applicant admitted in his SOR answer that he falsified his SCA when he failed to disclose his judgments and collection accounts.

POLICIES

When evaluating an applicant’s suitability for a security clearance, 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).

ANALYSIS

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.

AG ¶ 19 provides conditions that could raise security concerns. The following are potentially applicable:

(a) inability to satisfy debts;

(b) unwillingness to satisfy debts regardless of the ability to do so; and

Applicant has a history of delinquent student loans, unpaid judgments, and collection accounts that he has been unable or unwilling to resolve. They remain unresolved. 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 attributed his financial problems to a period when his student loans became due, and he had difficulty paying his other expenses. He admitted all of the debts in the SOR. He failed to provide documented evidence that he has resolved any of the debts or judgments in the SOR. His financial issues are ongoing and recent. AG ¶ 20(a) does not apply.

For the application of AG ¶ 20(b) the circumstances that created the financial problems must have been largely beyond Applicant’s control, and he must have acted responsibly under the circumstances. Applicant attributed his financial problems to a period when his student loans became due and he was unable to pay his other expenses. I cannot find that his financial problems were largely beyond his control. Applicant was aware that he obtained student loans, and that he would be required to pay them. He indicated to the investigator that he consolidated his student loans and paid them. However, he failed to provide evidence to show his student loans are paid or being paid. He was aware that he has judgments entered against him and other delinquent accounts. He told the investigator that he was addressing them. No supporting evidence was provided. There is insufficient evidence to conclude he has acted responsibly. AG ¶ 20(b) does not apply.

There is no evidence that Applicant received financial counseling and that his finances are under control. AG ¶ 20(c) does not apply. Applicant failed to provide documentary evidence to show he is paying or addressing any of the SOR debts. AG ¶ 20(d) does not apply. Applicant admitted all of the SOR debts. Therefore, AG ¶ 20(e) has not been raised.

Guideline E: Personal Conduct

AG ¶ 15 expresses the security concern for personal conduct:

Conduct involving questionable judgment, lack of candor, dishonesty, or unwillingness to comply with rules and regulations can raise questions about an individual's reliability, trustworthiness and ability to protect classified or sensitive information. Of special interest is any failure to cooperate or provide truthful and candid answers during national security investigative or adjudicative processes.

AG ¶ 16 describes conditions that could raise a security concern and may be disqualifying. I find the following one potentially applicable:

(a) deliberate omission, concealment, or falsification of relevant facts from any personnel security questionnaire, personal history statement, or similar form used to conduct investigations, determine employment qualifications, award benefits or status, determine security clearance eligibility or trustworthiness, or award fiduciary responsibilities.

Applicant had four judgments entered against him from 2011 to 2013. He was aware he was responsible for damage to his residence and could not pay for it. He was aware judgments had been entered against him and his wages were later garnished. He was aware that he could not pay his car loan, subsequently returned the car, and knew a judgment was entered against him. He was aware he had medical debts in collection. His explanation to the investigator for failing to disclose the judgments or collections accounts was because he was addressing them. Applicant’s explanations were not credible. Applicant admitted in his SOR answer that he falsified this information by deliberately failing to disclose it. AG ¶¶ 16(a) applies.

The guideline also includes conditions that could mitigate security concerns arising from personal conduct. I have considered the following two mitigating conditions under AG ¶ 17:

(a) the individual made prompt, good-faith efforts to correct the omission, concealment, or falsification before being confronted with the facts; and

(c) the offense is so minor, or so much time has passed, or the behavior is so infrequent, or it happened under such unique circumstances that it is unlikely to recur and does not cast doubt on the individual’s reliability, trustworthiness, or good judgment.

Applicant’s conduct is not minor. There is no evidence he made a prompt, good- faith effort to correct his falsification. Failing to be honest during the security clearance process is serious. There is insufficient evidence to conclude it happened under unique circumstances or it is unlikely to recur. Applicant’s conduct casts doubt on his reliability, trustworthiness, and good judgment. The above mitigating conditions do not 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 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 Guidelines F and E in my whole-person analysis. Some of the factors in AG ¶ 2(d) were addressed under those guidelines, but some warrant additional comment.

Applicant is 59 years old. He has delinquent student loans, judgments, and collection accounts that are unresolved. He deliberately failed to disclose his judgments and collection accounts on his SCA, as required. He failed to provide documents to substantiate his statements that he has paid or is paying some of his debts. There is insufficient evidence in mitigation. 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 arising under Guideline F, financial considerations, and Guideline E, personal conduct.

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.r: Against Applicant

Paragraph 2, Guideline E: AGAINST APPLICANT

Subparagraphs 2.a-2.b: Against Applicant

CONCLUSION

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

FOOTNOTES

1 Item 2. 2 Item 1. 3 Item 1, 2, 3, 4, 5. 4 Item 3. 5 Item 3. 6 Item 3. 7 Item 3.