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ISCR Case 16-02948.h1 — CASE

ISCR Case 16-02948.h1denied

Case Headnote

ISCR Case No. 16-02948.h1

deniedOct 3, 2017· Hon. Roger C. Wesley· hearing

Summary

A 29-year-old communication technician was denied a security clearance under Guideline F, Financial Considerations, due to unresolved financial issues. The Statement of Reasons detailed eight specific delinquent debts, including one for $6,471, another for $2,043 that was the subject of a court-ordered non-suit, and several others ranging from $25 to $500. In total, the applicant had 13 delinquent debts exceeding $14,000.

The denial was based on the applicant's failure to provide sufficient documented evidence of concrete steps taken to resolve these debts. While the applicant claimed some debts were resolved, these assertions lacked adequate corroboration. The decision cited Disqualifying Conditions 19(a), 19(b), and 19(c).

Although Mitigating Condition 20(b) was considered, it was determined that the applicant's financial difficulties raised significant concerns about her reliability and trustworthiness, which were not sufficiently mitigated by the evidence provided. Consequently, the security clearance was denied.

Why the Applicant Was Denied

The applicant failed to provide sufficient documented evidence of concrete steps taken to resolve her delinquent debts.
The applicant's financial difficulties raised concerns about her reliability and trustworthiness.
The applicant's claims of debt resolution were not corroborated by adequate documentation.

Conditions Referenced

Disqualifying

DC ¶ 19(a)raisedInability to Satisfy Debts
DC ¶ 19(b)raisedUnwillingness to Satisfy Debts Regardless of the Ability to Do So
DC ¶ 19(c)raisedA History of Not Meeting Financial Obligations

Mitigating

MC ¶ 20(b)appliedThe Conditions That Resulted in the Financial Problem Were Largely Beyond the Person’s ControlExtenuating circumstances accounted for some of the applicant's financial difficulties.

Key Rule Quoted

“Eligibility for access to classified information is denied.”

Procedural Posture

SOR issuedNov 1, 2016
Answer filedundated
Hearing heldApr 25, 2017Applicant requested to keep the record open for additional submissions.
Decision dateOct 3, 2017

Cite For

Failure to Provide Corroborating Evidence of Debt Resolution Under Guideline F
Impact of Financial Difficulties on Security Clearance Eligibility
Application of Disqualifying Conditions Related to Financial Considerations

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 accumulated 13 delinquent debts exceeding $14,000, which raised significant financial concerns under Guideline F. While one debt was resolved favorably, the applicant failed to provide sufficient evidence of progress in addressing the remaining debts, leading to a denial of the security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant has a delinquent debt of $6,471. $6,471	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.b	Applicant has a disputed debt of $2,043, which was the subject of a court-ordered non-suit. $2,043	For Applicant	Unspecified Financial	Denied	—	—	—
1.c	Applicant has a delinquent debt of $500. $500	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.d	Applicant has a delinquent debt of $431. $431	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.e	Applicant has a delinquent debt of $25. $25	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.f	Applicant has a delinquent debt of $25. $25	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.g	Applicant has a delinquent debt of $500. $500	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.h	Applicant has a delinquent debt of $431. $431	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.i–1.n	6 sub-charges — specific text not stated in this decision (against the applicant). (low confidence)	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: ) ) ) . ----------------------------------- ) ISCR Case No. 16-02948 ) ) Applicant for Security Clearance )

For Government: Robert Blazewick, Esq., Department Counsel For Applicant: Pro se 10/03/2017 _____________

STATEMENT OF CASE

______________

WESLEY, Roger C., Administrative Judge:

Based upon a review of the pleadings, exhibits, and testimony, I conclude that Applicant did not mitigate the security concerns regarding her financial considerations. Eligibility for access to classified information is denied.

On November 1, 2016, Department of Defense (DoD) Consolidated Adjudications Facility (CAF) issued a Statement of Reasons (SOR) detailing reasons why DoD adjudicators could not make the affirmative determination of eligibility for a security clearance, and recommended referral to an administrative judge to determine whether a security clearance should be granted, continued, denied, or revoked. The action was taken under Executive Order (Exec. Or.) 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 recently amended (Directive); and the Adjudicative Guidelines (AGs) implemented by DoD on September 1, 2006.1

Applicant responded to the SOR (undated) and requested a hearing. The case was assigned to me on March 2, 2017, and scheduled for hearing on April 25, 2017. The Government's case consisted of four exhibits (GEs 1-4). Applicant relied on one witness (herself) and no exhibits. The transcript (Tr.) was received on May 4, 2017.

Procedural Issues

Before the close of the hearing, Applicant requested permission to keep the record open to permit her the opportunity to supplement the record with copies of payments to her creditors. For good cause shown, Applicant was granted seven days ro supplement the record. Department Counsel was afforded two days to respond. Within the time permitted Applicant provided excerpts of her collection accounts covered in the SOR, an updated credit report reflecting her accounts in good standing, and a letter explaining her financial status and her enjoyment of her work. Applicant’s submissions were admitted without objection as exhibits A-D.

Summary of Pleadings

Under Guideline F, Applicant allegedly accumulated 13 delinquent debts exceeding $14,000. Allegedly, these listed delinquent debts remain outstanding. In her response to the SOR, Applicant admitted some of the allegations She admitted the allegations pertaining to SOR ¶¶ 1.a and., 1.c-1.m, while denying SOR ¶¶ 1.band 1.n. She expressed some uncertainty about allegations covered by SOR ¶¶ 1.dand 1.f.

FINDINGS OF FACT

Applicant is a 29-year-old emerging communication technician for a defense contractor who seeks a security clearance. (GE 1; Tr. 31) The allegations covered in the SOR and admitted by Applicant are incorporated and adopted as relevant and material findings. Additional findings follow.

Background

Applicant has never been married and has no children. She received a high school diploma in May 2005 and reported no post-high school education credits. She reported no military service.

updated substantive changes in the guidelines, effective June 8, 2017. Application of the AGs that were in Applicant has worked for her current employer as a deck electrician, and more recently as a emergency communication technician, since May 2012. GE 1; Tr. 30, 33) Previously, she was employed as a cashier for a non-defense contractor (October 2010 through May 2012), in various labor capacities for another non-defense contractor (August 2009-October 2010), and as a part-time concierge (May 2010-October 2010). (GE.s 1, 4; Tr. 29-30)

Applicant’s finances

Between 2012 and 2016, Applicant accumulated 13 delinquent debts (some medical and others consumer-related) (GEs 2-5) She attributed her medical debts to a lack of health insurance in 2012 and her consumer debts to insufficient income to cover her bills. (Tr. 27, 32, 41-43) All of Applicant’s SOR-listed were incurred before she joined her current employer in May 2010. (GEs 3-4; Tr. 32-34)

Among Applicant’s post-hearing submissions are excerpts of her May 2017 credit report covering collection debts that she disputes. (AE B; Tr. 34) Applicant is currently trying to enlist creditors whose bills she disputes to send her bills for her review. (Tr. 35) To date, she has not been successful in enlisting responses. (AEs A-B)

Applicant claimed to have satisfied several of the listed debts in the SOR: SOR debts ¶¶ 1.a ($6,471), 1.g ($500), 1.h ($431), and 1.l-1.m (both $25 debts). (AE B) She provided no documentation, however, to support her claims, and based on her recent credit reports, these debts remain outstanding.

SOR debts disputed by Applicant include a $2,043 debt covered by SOR ¶ 1.b. (AE C) Applicant urges that this debt was non-suited in November 2015 and is no longer an enforceable debt. While it is unclear whether Applicant conveyed any consideration to creditor 1.bto induce the creditor to take a non-suit in its civil action against Applicant, the debt was apparently resolved amicably between the parties and is no longer an enforceable debt.

Applicant disputed other debts she does not recognize. She disputed SOR debts ¶¶ 1.h ($431) and 1.n ($641) for cited reasons she has never received bills from these creditors. (AE B)

To date, Applicant has provided no payment documentation for those creditors Applicant claims to have paid. Further, she furnished no documentation or other probative corroborating evidence of any concerted efforts to resolve the debts she claims to have either addressed or intends to address. (AEs A-B) To her credit, Applicant is keeping other reported accounts in current status. (AEs A and D) None of these current accounts are included in the SOR. She assured in her post-hearing statement that she loves her job with the company she has worked for close to five years. (AE A) To this end, she assured she is “trying to get everything paid off.” (AE A) Applicant’s intentions appear to be sincere and are accepted. However, she has not provided sufficient documented evidence of concrete steps she has taken to advance her stated objectives. Nor has Applicant provided a budget, evidence of financial counseling, or character references of friends and colleagues who know her well from either working arrangements or contacts outside the workplace.

P o l i c i e s

The SEAD 4, App. A lists new AGs to be used by administrative judges in the decision-making process covering security clearance cases. These guidelines take into account factors that could create a potential conflict of interest for the individual applicant, as well as considerations that could affect the individual’s reliability, trustworthiness, and ability to protect classified information. These guidelines include conditions that could raise a security concern and may be disqualifying” (disqualifying conditions), if any, and many of the conditions that could mitigate security concerns. These guidelines must be considered before deciding whether or not a security clearance should be granted, continued, or denied. The guidelines do not require administrative judges to place exclusive reliance on the enumerated disqualifying and mitigating conditions in the guidelines in arriving at a decision. Each of the guidelines is to be evaluated in the context of the whole person in accordance with SEAD 4, App. A, ¶ (2)(c).

In addition to the relevant AGs, administrative judges must take into account the pertinent considerations for assessing extenuation and mitigation set forth in SEAD 4, App. A, ¶ 2(a) of the AGs. These AGs are intended to assist the judges in reaching a fair and impartial commonsense decision based upon a careful consideration of the pertinent guidelines within the context of the whole person.

The adjudicative process is designed to examine a sufficient period of an applicant’s life to enable predictive judgments to be made about whether the applicant is an acceptable security risk. See SEAD 4, App. A, ¶ 2(d) The following AG ¶ 2(d) factors are pertinent: (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 chances; (7) the motivation for the conduct; (8) the potential for pressure, coercion, exploitation, or duress; and (9) the likelihood of continuation or recurrence.

Viewing the issues raised and evidence as a whole, the following individual guidelines are pertinent in this case:

Financial Considerations

The Concern: 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 and 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 . . . AG ¶ 18.

Burden of Proof

By virtue of the principles and policies framed by the guidelines, a decision to grant or continue an applicant's security clearance may be made only upon a threshold finding that to do so is clearly consistent with the national interest. Because the Directive requires administrative judges to make a commonsense appraisal of the evidence accumulated in the record, the ultimate determination of an applicant's eligibility for a security clearance depends, in large part, on the relevance and materiality of that evidence. See United States, v. Gaudin, 515 U.S. 506, 509-511 (1995).

As with all adversarial proceedings, the judge may draw only those inferences which have a reasonable and logical basis from the evidence of record. Conversely, the judge cannot draw factual inferences that are grounded on speculation or conjecture.

The Government's initial burden is twofold: (1) it must prove by substantial evidence any controverted facts alleged in the SOR, and (2) it must demonstrate that the facts proven have a material bearing to the applicant's eligibility to obtain or maintain a security clearance. The required materiality showing, however, does not require the Government to affirmatively demonstrate that the applicant has actually mishandled or abused classified information before it can deny or revoke a security clearance. Rather, the judge must consider and weigh the cognizable risks that an applicant may deliberately or inadvertently fail to safeguard classified information.

Once the Government meets its initial burden of proof of establishing admitted or controverted facts, the evidentiary burden shifts to the applicant for the purpose of establishing his or her security worthiness through evidence of refutation, extenuation, or mitigation. Based on the requirement of Exec. Or. 10865 that all security clearances be clearly consistent with the national interest, the applicant has the ultimate burden of demonstrating his or her clearance eligibility. “[S]ecurity-clearance determinations should err, if they must, on the side of denials.” See Department of the Navy v. Egan, 484 U.S. 518, 531 (1988).

ANALYSIS

Security concerns are raised over Applicant’s accumulation of delinquent medical and consumer debts over a period of years. Applicant’s delinquent medical and consumer debts warrant the application of three of the disqualifying conditions (DC) of the guidelines: DC ¶ 19(a), “inability to satisfy debts,” DC ¶ 19(b), “unwillingness to satisfy debts regardless of the ability to do so,” and DC ¶ 19(c), “a history of not meeting financial obligations.” Applicant’s reported debts exceed $14,000 and have not been paid or otherwise resolved, except for SOR debt ¶ 1.b, which was the subject of a court-ordered non-suit of the creditor’s civil complaint. (AE C) Holding a security clearance involves the exercise of important fiducial responsibilities, among which is the expectancy of consistent trust and candor. Financial stability in a person cleared to access classified information is required precisely to inspire trust and confidence in the holder of the clearance. While the principal concern of a clearance holder’s demonstrated financial difficulties is vulnerability to coercion and influence, judgment and trust concerns are also implicit in financial cases.

While extenuating circumstances account for many of Applicant’s difficulties in paying certain medical and personal debts covered by the SOR, they do not adequately explain her failures to address her debts once she became fully employed with her current employer in 2012. Taking into account all of the circumstances associated with her accumulated delinquent debts, Applicant’s circumstances merit only partial application of MC ¶ 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.”

Applicant has since documented her favorable resolution of her SOR ¶ 1.bdebt, but has failed to provide any corroborating evidence of payment or successful resolution of her remaining listed debts. Based on the documented information available in the record, none of the other mitigating conditions are available to Applicant.

From a whole-person standpoint, Applicant’s inability to demonstrate more progress in addressing her delinquent debts preclude her from establishing a meaningful track record for meeting her medical and consumer debt obligations. See ISCR case No. 07-06482 at 2-3 (App. Bd. May 21, 2008).

Considering all of the circumstances surrounding Applicant’s accumulated medical and consumer debt delinquencies and her inability to do more with paying or otherwise successfully resolving her are insufficient to meet mitigation requirements imposed by the guideline governing financial considerations. Unfavorable conclusions are warranted with respect to the allegations covered by subparagraphs 1.a and 1.c-1.nof Guideline F. Favorable conclusions are warranted with respect to the allegation covered by subparagraph 1.bof the SOR.

FORMAL FINDINGS

In reviewing the allegations of the SOR and ensuing conclusions reached in the context of the findings of fact, conclusions, conditions, and the factors listed above, I make the following formal findings:

GUIDELINE F (FINANCIAL CONSIDERATIONS): AGAINST APPLICANT

Subparas. 1.a and 1.c-1.n: Against Applicant Subpara. 1.b: For Applicant

Conclusio n s

In light of all the circumstances presented by the record in this case, it is not clearly consistent with the national interest to grant or continue Applicant’s security clearance. Clearance is denied.

Roger C. Wesley Administrative Judge

FOOTNOTES

1 Effective June 8, 2017, by Directive 4 of the Security Executive Agent Directive (SEAD 4), dated December 10, 2016, National Security Adjudicative Guidelines for all covered individuals who require initial or continued eligibility for access to classified information or eligibility to hold a sensitive position were established to supercede all previously issued national security adjudicative criteria or guidelines. Procedures for administrative due process for contractor personnel continue to be governed by DoD 5220.6, subject to the

effect as of the issuance of the SOR would not change the decision in this case.