ISCR Case 15-08381.h1

Case Headnote

ISCR Case No. 15-08381.h1

grantedFeb 22, 2018· Hon. Robert Robinson Gales· hearing

Summary

A 54-year-old supply chain contracts manager for a defense contractor was granted a security clearance despite concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The Statement of Reasons (SOR) detailed several financial issues and misstatements on his April 27, 2015 e-QIP application.

The financial concerns included a $2,701 judgment from December 2012, a charged-off credit card with a $6,685 unpaid balance, and a bank credit card with a $5,584 unpaid balance that resulted in a $6,292.85 judgment in March 2013. Additionally, two bank credit cards in his wife's name, for which he was an authorized user, led to a judgment against her for unpaid balances of $6,293 and $5,174. Other debts included an unspecified account with a $7,287 unpaid balance and a medical account for $272. The applicant also misused a corporate credit card for personal expenses, totaling approximately $6,000 or $7,000, between October 2011 and May 2012. On his e-QIP, he falsely answered "no" to questions about judgments, debts in collection, suspended accounts, and delinquencies over 120 days, though he denied deliberate falsehood, attributing it to a naive assumption about his credit report.

The judge ultimately granted the clearance, finding that the applicant had made significant progress in resolving his financial issues, including making restitution to creditors. He provided evidence of financial counseling, demonstrated a stable income, and received character references from colleagues supporting his trustworthiness and integrity.

Why the Applicant Prevailed

The applicant demonstrated significant progress in resolving his financial issues, including making restitution to creditors.
He provided evidence of financial counseling and a stable income, indicating improved financial responsibility.
Character references from colleagues supported his trustworthiness and integrity.

Conditions Referenced

Disqualifying

F.3raisedInability or Unwillingness to Satisfy Debts
E.2raisedDeliberately Providing False or Misleading Information

Mitigating

F.2appliedThe Conditions That Resulted in the Financial Problems Were Largely Beyond the Person's Control
F.3appliedThe Individual Has Initiated a Good-faith Effort to Repay Overdue Creditors
E.2appliedThe Individual Has Taken Positive Steps to Address the Issues That Led to the False Statements

Key Rule Quoted

“A person who seeks access to classified information enters into a fiduciary relationship with the Government predicated upon trust and confidence.”
— Department of the Navy v. Egan, 484 U.S. 518, 528 (1988)

Procedural Posture

SOR issuedMar 4, 2016
Answer filedMar 30, 2016
Hearing heldAug 23, 2017
Decision dateFeb 22, 2018

Cite For

Mitigation of Financial Issues Under Guideline F
Trustworthiness Despite Past Personal Conduct Under Guideline E
Importance of Character References in Security Clearance Decisions

Editorial summary generated for research. Not legal advice; not a prediction. Verify against the full decision before relying on any quoted language.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a	On April 27, 2015, when Applicant completed his e-QIP, he responded to certain questions pertaining to his finances found in Section 26. Those questions asked if, in the past seven years, he had a judgment entered against him; he had any bills or debts turned over to a collection agency; he had any account or credit card suspended or cancelled for failing to pay as agreed; and if he has been over 120 days delinquent on any debt not previously entered; as well as if he is currently over 120 days delinquent on any debt. Applicant answered “no” to each of the questions. He certified that his responses to those questions were “true, complete, and correct” to the best of his knowledge and belief, but the responses to those questions were, in fact, false.	For Applicant	Omission or Failure to DiscloseNOT DELIBERATE	Financial	Denied	—	(a) prompt, good-faith correction before being confronted	Claimed Explanation of Omission Credible
2.b	Applicant acknowledged that he failed to check with the attorney, and merely naively assumed he had a clean credit report. He denied making a deliberate false statement regarding his financial obligations.	For Applicant	Lack of Candor in InterviewNOT DELIBERATE	Financial	Denied	—	(a) prompt, good-faith correction before being confronted	Claimed Explanation of Omission Credible
2.c	This refers to the information set forth above associated with SOR ¶ 1.i., and is adopted herein.	For Applicant	Misuse of Employer Time or Resources	—	Unknown	—	—	—

Allegation

Finding

Conduct

Concealed Issue

Response

Disqualifying (¶16)

Mitigating applied (¶17)

Mitigation

2.a

On April 27, 2015, when Applicant completed his e-QIP, he responded to certain questions pertaining to his finances found in Section 26. Those questions asked if, in the past seven years, he had a judgment entered against him; he had any bills or debts turned over to a collection agency; he had any account or credit card suspended or cancelled for failing to pay as agreed; and if he has been over 120 days delinquent on any debt not previously entered; as well as if he is currently over 120 days delinquent on any debt. Applicant answered “no” to each of the questions. He certified that his responses to those questions were “true, complete, and correct” to the best of his knowledge and belief, but the responses to those questions were, in fact, false.

For Applicant

Omission or Failure to DiscloseNOT DELIBERATE

Financial

Denied

—

(a) prompt, good-faith correction before being confronted

Claimed

Explanation of Omission Credible

2.b

Applicant acknowledged that he failed to check with the attorney, and merely naively assumed he had a clean credit report. He denied making a deliberate false statement regarding his financial obligations.

For Applicant

Lack of Candor in InterviewNOT DELIBERATE

Financial

Denied

—

(a) prompt, good-faith correction before being confronted

Claimed

Explanation of Omission Credible

2.c

This refers to the information set forth above associated with SOR ¶ 1.i., and is adopted herein.

For Applicant

Misuse of Employer Time or Resources

—

Unknown

—

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	This is a judgment for $2,701 on an unspecified type of account with an unidentified creditor filed by a debt purchaser in December 2012. $2,701	For Applicant	Unspecified Financial	Admitted	—	—	—
1.b	This is a credit card account with a $7,300 credit limit and an unpaid balance of $6,685 that was charged off. $6,685	For Applicant	Credit Card Debt	Admitted	—	—	—
1.c	These are two bank credit cards in Applicant’s wife’s name, for which Applicant is an authorized user, with $13,000 and $5,600 credit limits and unpaid balances of $6,293 and $5,174 that were bundled together and eventually filed as a judgment against Applicant’s wife. $0	For Applicant	Unspecified Financial	Admitted	—	—	—
1.d	This is a bank credit card account with a $6,000 credit limit and an unpaid balance of $5,584 for which a judgment in the amount of $6,292.85 was filed in March 2013. $5,584	For Applicant	Credit Card Debt	Admitted	—	—	—
1.e	This is an unspecified type of account with an unpaid balance of $7,287 that was transferred or sold to a debt purchaser. $7,287	For Applicant	Unspecified Financial	Admitted	—	—	—
1.f	This is a medical account with an unpaid balance of $272. $272	For Applicant	Medical Debt	Admitted	—	—	—
1.g	specific text not stated in this decision	For Applicant	Unspecified Financial	Unknown	—	—	—
1.h	As part of his employment, Applicant was issued a corporate credit card with use limited to authorized corporate expenditures. During the period October 2011 through May 2012, Applicant misused the credit card for personal expenses in the approximate amount of $6,000 or $7,000. $7,000	For Applicant	Credit Card Debt	Admitted	—	—	—
1.i	specific text not stated in this decision	For Applicant	Unspecified Financial	Unknown	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

This is a judgment for $2,701 on an unspecified type of account with an unidentified creditor filed by a debt purchaser in December 2012.

$2,701

For Applicant

Unspecified Financial

Admitted

—

1.b

This is a credit card account with a $7,300 credit limit and an unpaid balance of $6,685 that was charged off.

$6,685

For Applicant

Credit Card Debt

Admitted

—

1.c

These are two bank credit cards in Applicant’s wife’s name, for which Applicant is an authorized user, with $13,000 and $5,600 credit limits and unpaid balances of $6,293 and $5,174 that were bundled together and eventually filed as a judgment against Applicant’s wife.

For Applicant

Unspecified Financial

Admitted

—

1.d

This is a bank credit card account with a $6,000 credit limit and an unpaid balance of $5,584 for which a judgment in the amount of $6,292.85 was filed in March 2013.

$5,584

For Applicant

Credit Card Debt

Admitted

—

1.e

This is an unspecified type of account with an unpaid balance of $7,287 that was transferred or sold to a debt purchaser.

$7,287

For Applicant

Unspecified Financial

Admitted

—

1.f

This is a medical account with an unpaid balance of $272.

$272

For Applicant

Medical Debt

Admitted

—

1.g

specific text not stated in this decision

For Applicant

Unspecified Financial

Unknown

—

1.h

As part of his employment, Applicant was issued a corporate credit card with use limited to authorized corporate expenditures. During the period October 2011 through May 2012, Applicant misused the credit card for personal expenses in the approximate amount of $6,000 or $7,000.

$7,000

For Applicant

Credit Card Debt

Admitted

—

1.i

specific text not stated in this decision

For Applicant

Unspecified Financial

Unknown

—

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Case Profile

Summary

Why the Applicant Prevailed

Conditions Referenced

Key Rule Quoted

Procedural Posture

Cite For

Full decision

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

APPEARANCES

STATEMENT OF CASE

FINDINGS OF FACT

POLICIES

ANALYSIS

WHOLE PERSON CONCEPT

FORMAL FINDINGS

CONCLUSION

FOOTNOTES