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ISCR Case 16-02854.h1 — CASE

ISCR Case 16-02854.h1denied

Case Headnote

ISCR Case No. 16-02854.h1

deniedOct 19, 2017· Hon. Gina L. Marine· hearing

Summary

A 55-year-old janitor with a ninth-grade education was denied a security clearance under Guideline F (Financial Considerations) due to five delinquent accounts totaling approximately $9,108. The applicant acknowledged that these financial issues stemmed from layoffs, specifically mentioning a motorcycle loan he could no longer afford after losing his job.

The Statement of Reasons cited these delinquent debts as disqualifying conditions. Despite admitting to the financial difficulties, the applicant failed to provide any evidence of efforts to resolve his outstanding debts or to seek financial counseling.

Consequently, the judge determined that the applicant did not mitigate the security concerns raised by his failure to pay these delinquent debts, leading to the denial of his security clearance.

Why the Applicant Was Denied

The applicant had five delinquent accounts totaling approximately $9,108, which he admitted were due to financial issues.
He did not provide evidence of efforts to resolve his debts or any financial counseling received.
The judge found that the applicant did not mitigate the security concerns raised by his failure to pay delinquent debts.

Conditions Referenced

Disqualifying

AG ¶ 19(a)appliedInability to Satisfy Debts
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 AG.”

Procedural Posture

SOR issuedNov 15, 2016
Answer filedNov 29, 2016
Hearing held—Decision made on the record without a hearing.
Decision dateOct 19, 2017

Cite For

Failure to Provide Evidence of Debt Resolution Under Guideline F
Impact of Financial Irresponsibility on Security Clearance Eligibility
Criteria for Evaluating Financial Considerations in Security Clearance Cases

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 that the applicant had multiple delinquent accounts totaling approximately $9,108, which were either charged off or placed for collections. The applicant admitted to the debts but failed to provide sufficient evidence of mitigation, leading to a decision against the applicant under Guideline F for financial considerations.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	a motorcycle loan that he could no longer afford after a layoff	Against Applicant	Auto Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b–1.e	4 sub-charges — specific text not stated in this decision (against the applicant).	Against Applicant			—	—	—

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: ) ) [REDACTED] ) ISCR Case No. 16-02854 ) Applicant for Security Clearance )

For Government: Andrea M. Corrales, Esq., Department Counsel For Applicant: Pro se 10/19/2017 ______________

STATEMENT OF CASE

______________

MARINE, Gina L., 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 January 25, 2016. On November 15, 2016, the Department of Defense Consolidated Adjudications Facility (DOD CAF) sent him a Statement of Reasons (SOR) alleging security concerns under Guideline F. The DOD CAF acted 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) implemented by the DOD on September 1, 2006 (2006 AG).

Applicant answered the SOR on November 29, 2016, and requested a decision on the record without a hearing. On February 9, 2017, the Government submitted its written case and, on February 10, 2017, sent a complete copy of the file of relevant material (FORM) to Applicant, including documents identified as Items 1 through 5. He was given an opportunity to file objections and submit material to refute, extenuate, or mitigate the Government’s evidence. He received the FORM on February 21, 2017, and did not respond. Items 1 and 2 are the pleadings in the case. Items 3 through 5 are admitted into evidence. The case was assigned to me on October 2, 2017. On June 8, 2017, the DOD implemented new AG (2017 AG).1 Accordingly, I have applied the 2017 AG.2 However, I have also considered the 2006 AG, because they were in effect on the date the FORM was completed. I conclude that my decision would have been the same under either version.

Findings of Fact3

Applicant, age 55, married his third wife in April 2003. He has three adult children. Applicant’s highest level of education is the ninth grade. He has been employed full time as a janitor since October 2015. Prior to that, he worked primarily as a welder from 2000 through 2015, except for two months in 2014 and four months in 2015, when he was unemployed following layoffs.

Applicant has five delinquent accounts, totaling approximately $9,108, that were either charged off or placed for collections.4 When confronted about them during his March 2016 subject interview, he claimed awareness of only one: a motorcycle loan that he could no longer afford after a layoff (SOR ¶ 1.a). Otherwise, despite acknowledging that he had “financial issues” stemming from “an unstable work history,” he claimed no knowledge of any other delinquent debts. He claimed that, because he did not read or write, his wife handled their finances. He promised to investigate the accounts and work with his creditors to resolve them.

In his November 2016 SOR answer, Applicant admitted each of the debts alleged in the SOR. He attributed three of them to his layoffs (SOR ¶¶ 1.a through 1.c.) and, without providing corroborating documentation, claimed to have resolved one other (SOR 1.e). The record is silent as to what, if any, efforts, Applicant made since March 2016 to address his delinquent debts, or whether he has any plan to resolve them. The record is also silent as to how the layoffs impacted his ability to meet his financial obligations, his current ability to repay delinquent debts, or the reasons that they have persisted since October 2015. He has not received any financial counseling. In the FORM, the Government argued that Applicant had not provided sufficient documentary evidence to demonstrate mitigation, and advised him of the opportunity to do so in his response to the FORM.

POLICIES

“[N]o one has a ‘right’ to a security clearance.”5 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.”6 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.”7

Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the AG. 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.”8 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.9 “Substantial evidence” is “more than a scintilla but less than a preponderance.”10 The guidelines presume a nexus or rational connection between proven conduct under any of the criteria listed therein and an applicant’s security suitability.11 Once the Government establishes a disqualifying condition by substantial evidence, the burden shifts to the applicant to rebut, explain, extenuate, or mitigate the facts.12 An applicant has the burden of proving a mitigating condition, and the burden of disproving it never shifts to the Government.13

An applicant “has the ultimate burden of demonstrating that it is clearly consistent with the national interest to grant or continue his security clearance.”14 “[S]ecurity clearance determinations should err, if they must, on the side of denials.”15

ANALYSIS

The concern under Guideline F (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 . . . .

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.16 Applicant’s admissions and the credit report establish two disqualifying conditions under this guideline.17 He has not provided evidence to support any of the potentially applicable mitigating factors.18 Therefore, I conclude that Applicant has not mitigated the security concerns raised by his failure to pay delinquent debts. In reaching this decision, I have also considered the whole-person factors at AG ¶ 2(d).19

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.e: Against Applicant

CONCLUSION

I conclude that it is not clearly consistent with the national interest to grant Applicant eligibility for access to classified information. Clearance is denied.

Gina L. Marine Administrative Judge

FOOTNOTES

1 On December 10, 2016, the Security Executive Agent issued Directive 4 (SEAD-4), establishing a “single, common adjudicative criteria for all covered individuals who require initial or continued eligibility for access to classified information or eligibility to hold a sensitive position.” (SEAD-4 ¶ B, Purpose). The SEAD-4 became effective on June 8, 2017 (SEAD-4 ¶ F, Effective Date). The National Security Adjudicative Guidelines (AG), which are found at Appendix A to SEAD-4, apply to determine eligibility for initial or continued access to classified national security information. (SEAD-4 ¶ C, Applicability).

2 ISCR Case No. 02-00305 at 3 (App. Bd. Feb. 12, 2003) (security clearance decisions must be based on current DOD policy and standards).

3 Unless otherwise indicated by citation to another part of the record, I extracted these facts from Applicant’s SOR answer (Item 1), his SCA (Item 3), and the summary of his March 2016 subject interview (Item 5). Because Applicant did not respond to the FORM and affirmatively waive any objection to Item 5, I will consider only those facts in Item 5 that are not adverse to Applicant, unless they are contained in other evidence or based upon his admissions in the SOR answer.

4 See also GE 4. 5 Department of the Navy v. Egan, 484 U.S. 518, 528 (1988).

6 Egan at 527.

7 EO 10865 § 2.

8 EO 10865 § 7.

9 See Egan, 484 U.S. at 531. 10 See v. Washington Metro. Area Transit Auth., 36 F.3d 375, 380 (4th Cir. 1994).

11 ISCR Case No. 92-1106 at 3, 1993 WL 545051 at *3 (App. Bd. Oct. 7, 1993).

12 Directive ¶ E3.1.15.

13 ISCR Case No. 02-31154 at 5 (App. Bd. Sep. 22, 2005).

14 ISCR Case No. 01-20700 at 3 (App. Bd. Dec. 19, 2002).

15 Egan, 484 U.S. at 531; See also AG ¶ 2(b).

16 ISCR Case No. 11-05365 at 3 (App. Bd. May 1, 2012). 17 AG ¶ 19(a) (inability to satisfy debts); and AG ¶ 19(c) (a history of not meeting financial obligations).

18 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).

19 (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.