CASE · Clearance Adjudication Search EngineCASE

Loading case…

ISCR Case 16-03286.h1 — CASE

ISCR Case 16-03286.h1denied

Case Headnote

ISCR Case No. 16-03286.h1

deniedOct 5, 2017· Hon. Erin C. Hogan· hearing

Summary

A Department of Defense contractor employee was denied a security clearance under Guideline F (Financial Considerations) due to significant delinquent debts. The applicant had nine delinquent accounts totaling approximately $23,483, which raised concerns about her financial responsibility and judgment.

The Statement of Reasons detailed each of the nine delinquent accounts, all contributing to the approximate $23,483 total. These financial issues triggered disqualifying conditions under Adjudicative Guideline Paragraphs 19(a), 19(b), and 19(c).

The denial was based on the applicant's inability to satisfy her debts and her failure to demonstrate a good-faith effort to resolve them. Despite acknowledging her financial difficulties, she did not provide evidence of a plan to manage her obligations or participation in financial counseling. Consequently, the judge found no mitigating circumstances sufficient to overcome the security concerns, leading to the denial of her security clearance.

Why the Applicant Was Denied

The applicant incurred nine delinquent debts totaling approximately $23,483, indicating an inability to satisfy debts.
She did not demonstrate a good-faith effort to resolve her delinquent debts or provide evidence of financial counseling.
The applicant failed to present a plan for managing her financial obligations.

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)appliedHistory of Not Meeting Financial Obligations

Key Rule Quoted

“An applicant is not required to be debt free, but is required to manage her finances in such a way as to meet her financial obligations.”

Procedural Posture

SOR issuedNov 30, 2016
Answer filedDec 19, 2016Requested decision on the record.
Hearing held—Decision based on written record.
Decision dateOct 5, 2017

Cite For

Denial of Security Clearance Due to Financial Irresponsibility Under Guideline F
Lack of Mitigating Circumstances in Financial Considerations
Importance of Demonstrating a Plan to Resolve Debts for 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 multiple financial concerns under Guideline F, including nine delinquent debts totaling approximately $23,483, which the applicant admitted. The applicant failed to demonstrate a good-faith effort to resolve these debts or provide evidence of financial counseling, leading to a decision against her eligibility for a security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant incurred nine delinquent accounts with an approximate total of $23,483. $23,483	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 incurred nine delinquent accounts with an approximate total of $23,483. $23,483	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.c	Applicant incurred nine delinquent accounts with an approximate total of $23,483. $23,483	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 incurred nine delinquent accounts with an approximate total of $23,483. $23,483	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.e	Applicant incurred nine delinquent accounts with an approximate total of $23,483. $23,483	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.f	Applicant incurred nine delinquent accounts with an approximate total of $23,483. $23,483	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.g	Applicant incurred nine delinquent accounts with an approximate total of $23,483. $23,483	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 incurred nine delinquent accounts with an approximate total of $23,483. $23,483	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.i	Applicant incurred nine delinquent accounts with an approximate total of $23,483. $23,483	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	—	—

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: ) ) [Name Redacted] ) ISCR Case No. 16-03286 ) ) Applicant for Security Clearance )

For Government: Bryan Olmos, Esquire, Department Counsel For Applicant: Pro se

10/05/2017 ______________

STATEMENT OF CASE

______________

HOGAN, Erin C., Administrative Judge:

On November 30, 2016, the Department of Defense (DOD) issued a Statement of Reasons (SOR) to Applicant detailing security concerns under Guideline F, Financial Considerations. 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 after September 1, 2006. The AGs implemented on September 1, 2006, have been superceded by AGs implemented by DOD on June 8, 2017. The June 8, 2017 AGs will be used to decide this case. If the September 1, 2006 AGs were applied, the outcome of this case would be the same.

On December 19, 2016, Applicant answered the SOR and requested a decision on the record. Department Counsel issued a File of Relevant Material (FORM) on February 1, 2017. Applicant received the FORM on February 10, 2017. Applicant had 30 days to submit a response to the FORM. She did not submit a response to the FORM. On April 3, 2017, the FORM was forwarded to the Hearing Office and assigned to me on October 1, 2017. Based upon a review of the pleadings, exhibits, and testimony, eligibility for access to classified information is denied.

FINDINGS OF FACT

Applicant is an employee of a DOD contractor seeking a security clearance. She has been employed with her current employer since 2014. She has a high school diploma and some college credit. She is married and has two children, ages 5 and 6. (Item 3)

On January 13, 2016, Applicant submitted an Electronic Questionnaire for Investigations Processing (Item 3) A subsequent background investigation revealed Applicant had nine debts with an approximate total balance of $23,483. Of that amount, four of the debts were medical accounts totaling $6,557. (Item 5; Item 6)

In her response to the SOR, Applicant admits all allegations in SOR. She explains that these debts were incurred in 2010 when she transitioned from a full-time position to a part-time position in order to care for her newborn son. She was unable to support her new family and pay her bills as a result of her reduced income. She intended to find a full-time position in 2011, but she learned she was carrying her second child and decided to remain working part time. Her family has suffered from financial strain as a result. She decided to go back to school in 2014 and found a full- time position in 2015. Her goal is to pay off these debts and attain good financial standing. She understands the security security concerns that her financial issues raise, but states she would never commit espionage.

Applicant did not provide any information about whether she had a plan in place to resolve her delinquent debts. She provided no receipts indicating whether any respective debts were paid and no evidence of payment plans with any of the creditors alleged in the SOR. She did not provide information on her financial status, such as a monthly budget which shows her family’s monthly income and monthly expenses. There is no indication that she attended financial counseling.

POLICIES

When evaluating an applicant’s suitability for a security clearance, the administrative judge must consider the AG. In addition to brief introductory explanations for each guideline, the adjudicative guidelines list potentially disqualifying conditions and mitigating conditions, which are useful 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 over-arching adjudicative goal is a fair, impartial and commonsense decision. According to AG ¶ 2(a), 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 access 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.

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 applicant or proven by Department Counsel. . . .” The applicant 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 the applicant may deliberately or inadvertently fail to protect or 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 notes several disqualifying conditions that could raise security concerns. The disqualifying conditions that are relevant to Applicant’s case include:

(a) inability to satisfy debts;

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

All of the above disqualifying conditions apply because Applicant incurred nine delinquent accounts with an approximate total of $23,483.

An individual who is financially irresponsible may also be irresponsible, unconcerned, or careless in her obligations to protect classified information. Behaving irresponsibly in one aspect of life provides an indication of how a person may behave in other aspects of life. A person’s relationship with her creditors is a private matter until evidence is uncovered demonstrating an inability or unwillingness to pay debts under agreed terms. Absent evidence of strong extenuating or mitigating circumstances, an applicant with a history of serious or recurring financial difficulties is in a situation of risk inconsistent with the holding of a security clearance. An applicant is not required to be debt free, but is required to manage her finances in such a way as to meet her financial obligations.

The concern under Financial Considerations is broader than the possibility that a person might knowingly compromise classified information to obtain money or something else of value. It encompasses concerns about a person’s self-control, judgment, and other important qualities.

The Government’s substantial evidence and Applicant’s admissions raised security concerns under Guideline F. The burden shifted to Applicant to produce evidence to rebut, explain, extenuate, or mitigate the security concerns. (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. Sept. 22, 2005))

AG ¶ 20 includes examples of conditions that could mitigate security concerns arising from financial difficulties. The following mitigating conditions potentially apply:

(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 financial counseling service, and there are clear indications the problem is being resolved or is under control; and

(d) the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts.

None of the mitigating conditions apply. Applicant acknowledges her financial problems, but has not demonstrated a good-faith effort to resolve her delinquent debts. If Applicant develops of plan to pay her delinquent debts, attends financial counseling, and follows a budget, she may mitigate the concerns raised under financial considerations. At this time, she has not met her burden of proof to mitigate the security concerns.

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 Applicant’s work for a DoD contractor since 2014, and her attempts to improve her financial situation by going back to school. However, she did not provide proof that she was actively taking steps to resolve her delinquent accounts. The security concerns raised under financial considerations are not mitigated.

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.i: Against Applicant

CONCLUSION

In light of all of the circumstances presented by the record in this case, it is not clearly consistent with the interests of national security to grant Applicant eligibility for a security clearance. Eligibility for access to classified information is denied.

_________________ ERIN C. HOGAN Administrative Judge