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ISCR Case 16-02730.h1 — CASE

ISCR Case 16-02730.h1granted

Case Headnote

ISCR Case No. 16-02730.h1

grantedNov 14, 2017· Hon. Mark W. Harvey· hearing

Summary

A 47-year-old human relations employee was initially flagged for security concerns under Guideline F (Financial Considerations) due to delinquent debts totaling $37,405. The Statement of Reasons (SOR) detailed multiple outstanding obligations. These included a $3,674 charged-off debt from a 2011 vehicle accident, where the amount represented the remaining balance after insurance was applied to the lien.

Additionally, the SOR listed several medical debts ranging from $66 to $1,318, a utility debt of $666, and another collection debt of $79. A significant portion of the outstanding amount comprised five student loans, with individual balances ranging from $725 to $8,504. The applicant also had nonpriority unsecured debts totaling $16,042 discharged under Chapter 7 bankruptcy in September 2005.

Despite these financial challenges, the applicant demonstrated substantial mitigating factors. She paid approximately $15,000 towards her student loans and established a payment plan for the remaining balance. The judge considered her limited financial resources and family obligations, concluding that she acted responsibly and presented a reasonable plan for future debt resolution. Consequently, her security clearance was GRANTED.

Why the Applicant Prevailed

The applicant made significant payments towards her student loans, demonstrating a commitment to resolving her financial issues.
She provided evidence of her limited financial resources and the impact of her family obligations on her finances.
The judge found that the applicant acted responsibly under her circumstances and had a reasonable plan for future debt resolution.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability to Satisfy Debts
AG ¶ 19(c)raisedHistory of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(b)appliedConditions Beyond the Person's Control
AG ¶ 20(d)appliedGood-faith Effort to Repay Debts

Key Rule Quoted

“Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the adjudicative guidelines.”

Procedural Posture

SOR issuedOct 13, 2016
Answer filedNov 7, 2016
Hearing heldSep 6, 2017
Decision dateNov 6, 2017

Cite For

Mitigation of Financial Issues Under Guideline F
Consideration of Family Obligations Impacting Financial Stability
Evidence of Good-faith Efforts in Debt Repayment

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: granted

The judge found that the applicant made progress in resolving her financial issues, having paid approximately $15,000 towards her student loans. Despite having delinquent debts totaling $37,405, the judge ruled in favor of the applicant, concluding that the financial considerations security concerns were mitigated.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	SOR ¶ 1.a alleges a charged-off debt for $3,674. In 2011, Applicant’s vehicle was totaled in an accident, and the amount owed is the amount left after her insurance was applied to her lien. $3,674	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.b	SOR ¶ 1.b alleges a medical debt placed for collection for $601. $601	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.c	SOR ¶ 1.c alleges a medical debt placed for collection for $214. $214	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.d	SOR ¶ 1.d alleges a medical debt placed for collection for $135. $135	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.e	SOR ¶ 1.e alleges a medical debt placed for collection for $87. $87	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.f	SOR ¶ 1.f alleges a medical debt placed for collection for $66. $66	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.g	SOR ¶ 1.g alleges a medical debt placed for collection for $1,318. $1,318	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.h	SOR ¶ 1.h alleges a student loan placed for collection for $8,504. $8,504	For Applicant	Student Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.i	SOR ¶ 1.i alleges a student loan placed for collection for $7,963. $7,963	For Applicant	Student Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.j	SOR ¶ 1.j alleges a student loan placed for collection for $7,961. $7,961	For Applicant	Student Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.k	SOR ¶ 1.k alleges a student loan placed for collection for $5,414. $5,414	For Applicant	Student Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.l	SOR ¶ 1.l alleges one student loan placed for collection for $725. $725	For Applicant	Student Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.m	SOR ¶ 1.m alleges a utility debt placed for collection for $666. $666	For Applicant	Utility or Phone Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.n	SOR ¶ 1.n alleges a debt placed for collection for $79. $79	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.o	SOR ¶ 1.o alleges Applicant’s nonpriority unsecured debts were discharged under Chapter 7 of the Bankruptcy Code in September 2005. Her nonpriority debts listed in her bankruptcy petition totaled $16,042. $16,042	For Applicant	Bankruptcy Filing	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Claimed Other

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. 16-02730 ) ) Applicant for Security Clearance

For Government: Julie R. Mendez, Esq., Department Counsel For Applicant: Pro se

11/14/2017 ___________

STATEMENT OF CASE

___________

HARVEY, Mark, Administrative Judge:

Applicant made progress towards resolution of her financial issues. She has paid about $15,000 towards her student loans, and her student loans were removed from her credit report, leaving her with about $6,900 of non-student-loan delinquent debt. Due to her limited financial resources, she was unable to make greater progress on her finances. Financial considerations security concerns are mitigated. Eligibility for access to classified information is granted.

Statement of the Case

On September 24, 2015, Applicant signed a Questionnaire for National Security Positions (SF 86) or security clearance application (SCA). Government Exhibit (GE) 1. On October 13, 2016, the Department of Defense (DOD) Consolidated Adjudications Facility (CAF) issued a statement of reasons (SOR) to Applicant under Executive Order (Exec. Or.) 10865, Safeguarding Classified Information within Industry, February 20, 1960; DOD Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (Directive), January 2, 1992; and the Adjudicative Guidelines for Determining Eligibility for Access to Classified Information, effective on September 1, 2006. Hearing Exhibit (HE) 2. The SOR set forth security concerns arising under the financial considerations guideline. HE 2. On November 7, 2016, Applicant provided a response to the SOR, and she requested a hearing. HE 3. On December 13, 2016, Department Counsel was ready to proceed. On July 5, 2017, the case was assigned to me. On August 2, 2017, the Defense Office of Hearings and Appeals (DOHA) issued a notice of hearing, setting the hearing for September 6, 2017. HE 1. Applicant’s hearing was held as scheduled.

During the hearing, Department Counsel offered four exhibits; Applicant offered nine exhibits; there were no objections; and all proffered exhibits were admitted into evidence. Tr. 17-21; GE 1-4; Applicant Exhibits (AE) A-I. On September 14, 2017, DOHA received a copy of the hearing transcript. On September 18, 2017, Applicant provided one exhibit, which was admitted without objection. AE J. The record closed on November 6, 2017. Tr. 40.

The Director of National Intelligence (DNI) issued Security Executive Agent Directive 4, establishing in Appendix A the National Security Adjudicative Guidelines for Determining Eligibility for Access to Classified Information or Eligibility to Hold a Sensitive Position (AGs), which he made applicable to all covered individuals who require initial or continued eligibility for access to classified information or eligibility to hold a sensitive position on or after June 8, 2017. The new AGs supersede the previous AGs. Accordingly, I have evaluated Applicant’s security clearance eligibility under the new AGs.1

Findings of Fact2

In Applicant’s SOR response, she admitted the allegations in SOR ¶¶ 1.a through 1.land 1.o. HE 3. She also provided extenuating and mitigating information. HE 3.

Applicant is 47 years old, and she has been employed in human relations and administration for a government contractor from October 2007 to November 2014. Tr. 7- 9, 22. In 1989, she graduated from high school. Tr. 7. She has enough college credits to be a junior. Tr. 8. She has not received a degree. Tr. 8. She has never served in the military. Tr. 8. She has never been married, and she has a 17-year-old daughter. Tr. 8. There is no evidence of security violations, abuse of alcohol, or use of illegal drugs.

In 2010, Applicant’s father was diagnosed with leukemia, and in 2011, he passed away. Tr. 27. She believes Agent Orange from his Vietnam service caused his leukemia. Tr. 27-28. Applicant moved in with her parents to help her father with his leukemia. Tr. 28. She lived with her mother until August 2016. Tr. 29. Applicant moved because her mother was selling her home. Tr. 35. She helped her parents financially. Tr. 28-29. Financial Considerations

Applicant was a teacher from 1994 to 2007. Tr. 25. From October 2007 to November 2014, a government contractor employed Applicant to support a non-DOD federal agency. Tr. 22. In 2014, she was earning $38,000 annually. Tr. 23. She quit that job because she was tired of the commute and wanted to provide more assistance with her daughter’s after-school activities. Tr. 23. She obtained part-time and then full-time employment from a store. Tr. 23. She currently earns $10.20 an hour or about $20,000 annually. AE H. She currently has net income of $1,100 monthly. Tr. 24, 36. Applicant’s rent is $900 monthly, leaving her with about $200 for all of her other expenses. Tr. 36; AE I. She did not want to move out of the expensive metropolitan area where she currently resides because her daughter is a senior in high school. Tr. 35. If she obtains employment with the contractor sponsoring her clearance, she will be able to bring her debts to current status. Tr. 24. She anticipates her annual pay will double to about $40,000 annually. Tr. 24. Applicant has been unable since 2015 to make any payments on any of her SOR debts, except for her student loans. Tr. 37. She attempted to get some creditors to accept payments of $5 or $10, and they refused to accept such small amounts. Tr. 38.

The SOR alleges 14 delinquent debts totaling $37,405, and the record establishes the status of Applicant’s accounts as follows:

SOR ¶ 1.a alleges a charged-off debt for $3,674. In 2011, Applicant’s vehicle was totaled in an accident, and the amount owed is the amount left after her insurance was applied to her lien. Tr. 27.

SOR ¶¶ 1.bthrough 1.gallege six medical debts placed for collection for $601, $214, $135, $87, $66, and $1,318. Applicant and her daughter received surgeries. Tr. 29. She made some small payments on some of her medical debts before 2015. Tr. 30.

SOR ¶¶ 1.hthrough 1.kallege four student loans totaling $29,840 owed to the same creditor that were placed for collection for $8,504, $7,963, $7,961, and $5,414. Applicant believes the correct amount owed is about $14,000. Tr. 30-32. Payments to the creditor are automatically made from her pay through a garnishment that has been in effect for at least three years. Tr. 31. Her August 24, 2017 pay statement shows $1,677 paid so far in 2017 to address her student loans. AE H. The IRS pays any tax refund she is entitled to receive to her student loan creditor. Tr. 32. On September 11, 2017, the creditor wrote that her current student loan debt was $14,050, and if the loan was rehabilitated, collection costs of $2,750 would be waived, leaving a total debt of $11,250. AE J. Her student loans are not listed on her August 3, 2016 credit report, which is the most recent credit report of record. GE 3.

SOR ¶ 1.lalleges one student loan placed for collection for $725. Applicant borrowed the funds in 2013 or 2014. Tr. 33. This student loan is not listed on her August 3, 2016 credit report, which is the most recent credit report of record. GE 3.

SOR ¶ 1.malleges a utility debt placed for collection for $666. Applicant contacted the creditor, and they were unable to locate any evidence of the debt. Tr. 33. This utility debt is not listed on her August 3, 2016 credit report, which is the most recent credit report of record. GE 3.

SOR ¶ 1.nalleges a debt placed for collection for $79. Applicant had a copay from an ambulance she took to the hospital. Tr. 34. She believed her insurance company paid this debt. Tr. 41. This medical debt is not listed on her August 3, 2016 credit report, which is the most recent credit report of record. GE 3.

SOR ¶ 1.o alleges Applicant’s nonpriority unsecured debts were discharged under Chapter 7 of the Bankruptcy Code in September 2005. Her nonpriority debts listed in her bankruptcy petition totaled $16,042. GE 4.

Character Evidence

Applicant provided seven character statements from friends and coworkers. AE A- AE G. The general sense of the statements is that Applicant is diligent, talented, cheerful, helpful, loyal, reliable, competent, honest, and professional. She makes important contributions to mission accomplishment.

POLICIES

The U.S. Supreme Court has recognized the substantial discretion of the Executive Branch in regulating access to information pertaining to national security emphasizing, “no one has a ‘right’ to a security clearance.” Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). 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.” Id. at 527. The President has authorized the Secretary of Defense or his designee to grant applicant’s eligibility for access to classified information “only upon a finding that it is clearly consistent with the national interest to do so.” Exec. Or. 10865, Safeguarding Classified Information within Industry § 2 (Feb. 20, 1960), as amended.

Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the adjudicative guidelines. These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, these guidelines are applied 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, 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 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 “in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.” See Exec. Or. 10865 § 7. Thus, nothing in this decision should be construed to suggest that it is based, in whole or in part, on any express or implied determination about applicant’s allegiance, loyalty, or patriotism. It is merely an indication the applicant has not met the strict guidelines the President, Secretary of Defense, and DNI 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. See Egan, 484 U.S. at 531. “Substantial evidence” is “more than a scintilla but less than a preponderance.” See v. Washington Metro. Area Transit Auth., 36 F.3d 375, 380 (4th Cir. 1994). The guidelines presume a nexus or rational connection between proven conduct under any of the criteria listed therein and an applicant’s security suitability. See ISCR Case No. 95-0611 at 2 (App. Bd. May 2, 1996).

Once the Government establishes a disqualifying condition by substantial evidence, the burden shifts to the applicant to rebut, explain, extenuate, or mitigate the facts. Directive ¶ E3.1.15. An applicant “has the ultimate burden of demonstrating that it is clearly consistent with the national interest to grant or continue his security clearance.” ISCR Case No. 01-20700 at 3 (App. Bd. Dec. 19, 2002). The burden of disproving a mitigating condition never shifts to the Government. See ISCR Case No. 02-31154 at 5 (App. Bd. Sept. 22, 2005). “[S]ecurity clearance determinations should err, if they must, on the side of denials.” Egan, 484 U.S. at 531; see AG ¶ 2(b).

ANALYSIS

Financial Considerations

AG ¶ 18 articulates the security concern for financial problems:

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. . . . An individual who is financially overextended is at greater risk of having to engage in illegal or otherwise questionable acts to generate funds. . . .

The Appeal Board explained the scope and rationale for the financial considerations security concern in ISCR Case No. 11-05365 at 3 (App. Bd. May 1, 2012) (citation omitted) as follows:

This concern is broader than the possibility that an applicant might knowingly compromise classified information in order to raise money in satisfaction of his or her debts. Rather, it requires a Judge to examine the totality of an applicant’s financial history and circumstances. The Judge must consider pertinent evidence regarding the applicant’s self-control, judgment, and other qualities essential to protecting the national secrets as well as the vulnerabilities inherent in the circumstances. The Directive presumes a nexus between proven conduct under any of the Guidelines and an applicant’s security eligibility.

AG ¶ 19 includes two disqualifying conditions that could raise a security concern and may be disqualifying in this case: “(a) inability to satisfy debts”; and “(c) a history of not meeting financial obligations.” In ISCR Case No. 08-12184 at 7 (App. Bd. Jan. 7, 2010), the Appeal Board explained:

It is well-settled that adverse information from a credit report can normally meet the substantial evidence standard and the government’s obligations under [Directive] ¶ E3.1.14 for pertinent allegations. At that point, the burden shifts to applicant to establish either that [he or] she is not responsible for the debt or that matters in mitigation apply.

(internal citation omitted). The record establishes the disqualifying conditions in AG ¶¶ 19(a) and 19(c) requiring additional inquiry about the possible applicability of mitigating conditions.

Five financial considerations mitigating conditions under AG ¶ 20 are potentially applicable in this case:

(a) the behavior happened so long ago,3 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.

The DOHA Appeal Board concisely explained Applicant’s responsibility for proving the applicability of mitigating conditions as follows:

Once a concern arises regarding an Applicant’s security clearance eligibility, there is a strong presumption against the grant or maintenance of a security clearance. See Dorfmont v. Brown, 913 F. 2d 1399, 1401 (9th Cir. 1990), cert. denied, 499 U.S. 905 (1991). After the Government presents evidence raising security concerns, the burden shifts to the applicant to rebut or mitigate those concerns. See Directive ¶ E3.1.15. The standard applicable in security clearance decisions is that articulated in Egan, supra. “Any doubt concerning personnel being considered for access to classified information will be resolved in favor of the national security.” Directive, Enclosure 2 ¶ 2(b).

ISCR Case No. 10-04641 at 4 (App. Bd. Sept. 24, 2013).

The SOR alleges 14 delinquent debts totaling $37,405. SOR ¶¶ 1.hthrough 1.kallege four student loans totaling $29,840. On September 11, 2017, the creditor wrote that her current student loan debt total was $14,050, and if the loan was rehabilitated, collection costs of $2,750 would be waived, leaving a total debt of $11,250. Her student loans are not listed on her August 3, 2016 credit report, which is the most recent credit report of record. She is credited with a current payment plan on her student loan.4 The non-student loan SOR debts total about $6,900.

Medical problems, the needs of her parents and daughter, and underemployment harmed Applicant’s finances. Applicant’s current annual gross income is $20,000, and her net annual income is about $13,000. Her annual rent alone is $10,800. She does not have sufficient income to address her non-student-loan debts. If she receives a security clearance, she can obtain employment that will double her income and she will be able to resolve her remaining SOR debts.

Two recent Appeal Board decisions illustrate the analysis for applying AG ¶¶ 20(a) and 20(b). In ISCR Case No. 09-08533, the applicant had $41,000 in delinquent credit card debt and defaulted on a home loan generating a $162,000 delinquent debt. Id. at 2. That applicant filed for bankruptcy the same month the Administrative Judge issued her decision. Id. at 1-2. The applicant in ISCR Case No. 09-08533 was recently divorced, had been unemployed for 10 months, and had childcare responsibilities. Her former husband was inconsistent in his child support payments to her. The Appeal Board determined that AG ¶ 20(a) was “clearly applicable (debt occurred under such circumstances that it is unlikely to recur and [the debt] does not cast doubt on the individual’s current reliability, trustworthiness, or good judgment)” even though that applicant’s debts were unresolved at the time the Administrative Judge’s decision was issued. The Appeal Board also decided that the record evidence raised the applicability of AG ¶ 20(b) because of the absence of evidence5 of irresponsible behavior, poor judgment, unreliability, or lack of trustworthiness. Id. at 4.

Similarly, in ISCR Case No. 08-06567 at 3 (App. Bd. Oct. 29, 2009) the Appeal Board addressed a situation where an applicant was sporadically unemployed and lacked the ability to pay her creditors. The Appeal Board noted “it will be a long time at best before she has paid” all of her creditors. The applicant was living on unemployment compensation at the time of her hearing. The Appeal Board explained that such a circumstance was not necessarily a bar to having access to classified information stating:

However, the Board has previously noted that an applicant is not required to be debt-free nor to develop a plan for paying off all debts immediately or simultaneously. All that is required is that an applicant act responsibly given his [or her] circumstances and develop a reasonable plan for repayment, accompanied by “concomitant conduct,” that is, actions which evidence a serious intent to effectuate the plan. See ISCR Case No. 07-06482 at 3 (App. Bd. May 21, 2008).

ISCR Case No. 08-06567 at 3 (App. Bd. Oct. 29, 2009). The applicant in ISCR Case No. 08-06567 used his limited resources to (1) resolve some of his debts; (2) had a repayment plan for the remaining debts; and (3) took “reasonable actions to effectuate that plan.” Id. The Appeal Board remanded the Administrative Judge’s decision because it did not “articulate a satisfactory explanation for his conclusions,” emphasizing the Administrative Judge did “not explain[] what he believes that applicant could or should have done under the circumstances that he has not already done to rectify his poor financial condition, or why the approach taken by applicant was not ‘responsible’ in light of his limited circumstances.” Id.

Application of AG ¶¶ 20(a), 20(b), and 20(d) is warranted. Her financial situation was damaged by medical debts, underemployment, and support she provided for her parents and daughter. She acted responsibly by paying as many debts as possible and establishing payment plans for several debts. Although there is limited evidence of record that she established and maintained contact with her creditors,6 her financial problem is being resolved or is under control.

Applicant admitted responsibility for and took reasonable and responsible actions to resolve her debts, establishing some good faith.7 Based on Applicant’s credible and sincere promise to pay her debts and her track record of paying her debts, future new delinquent debt “is unlikely to recur and does not cast doubt on [Applicant’s] current reliability, trustworthiness, or good judgment,” and “there are clear indications that the problem is being resolved or is under control.” Applicant assures she will conscientiously endeavor to maintain her financial responsibility, and she will be able to apply increases in income to resolve her remaining debts. Her efforts are sufficient to mitigate financial considerations 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.

ISCR Case No. 99-9020 at 5-6 (App. Bd. June 4, 2001)). Under AG ¶ 2(c), “[t]he ultimate determination” of whether to grant a security clearance “must be an overall commonsense judgment based upon careful consideration of the guidelines” and the whole-person concept. My comments under Guideline F are incorporated in my whole-person analysis. Some of the factors in AG ¶ 2(d) were addressed under that guideline but some warrant additional comment.

Applicant is 47 years old, and she was employed in human relations and administration for a government contractor from October 2007 to November 2014. She has enough college credits to be a junior. She has never been married, and she has a 17-year-old daughter. She provided seven character statements from friends and coworkers, and their general sense is that she is diligent, talented, cheerful, helpful, loyal, reliable, competent, honest, and professional. There is no evidence of security violations, abuse of alcohol, or use of illegal drugs.

The SOR alleges 14 delinquent debts totaling $37,405, and $29,840 of that total consists of four student loans. She paid her student loan debt down to $14,050. The student loan creditor is willing to work with Applicant to rehabilitate and discount her student loan debt to $11,250. The remaining non-student-loan SOR debt totals $6,900. The Appeal Board has addressed a key element in the whole-person analysis in financial cases stating:

. . . the concept of meaningful track record necessarily includes evidence of actual debt reduction through payment of debts. However, an applicant is not required, as a matter of law, to establish that he has paid off each and every debt listed in the SOR. All that is required is that an applicant demonstrate that he has . . . established a plan to resolve his financial problems and taken significant actions to implement that plan. The Judge can reasonably consider the entirety of an applicant’s financial situation and his actions in evaluating the extent to which that applicant’s plan for the reduction of his outstanding indebtedness is credible and realistic. See Directive ¶ E2.2(a) (Available, reliable information about the person, past and present, favorable and unfavorable, should be considered in reaching a determination.) There is no requirement that a plan provide for payments on all outstanding debts simultaneously. Rather, a reasonable plan (and concomitant conduct) may provide for the payment of such debts one at a time. Likewise, there is no requirement that the first debts actually paid in furtherance of a reasonable debt plan be the ones listed in the SOR.

ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008) (internal citations and quotation marks omitted). She understands what she needs to do to establish and maintain her financial responsibility. She took reasonable actions under her particular financial circumstances to address her delinquent debts. Applicant has established a “meaningful track record” of debt re-payment, and she assures she will maintain her financial responsibility once she has the means to do so.8

I have carefully applied the law, as set forth in Egan, Exec. Or. 10865, the Directive, and the AGs, to the facts and circumstances in the context of the whole person. I conclude that financial considerations security concerns are mitigated. It is clearly consistent with the interests of national security to grant Applicant security clearance eligibility.

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: FOR APPLICANT

Subparagraphs 1.a through 1.o: For Applicant

CONCLUSION

In light of all of the circumstances in this case, it is clearly consistent with the interests of national security to grant Applicant’s eligibility for a security clearance. Eligibility for access to classified information is granted.

_________________________ Mark Harvey Administrative Judge

FOOTNOTES

1 Application of the AGs that were in effect as of the issuance of the SOR would not change my decision in this case. The new AGs are available at http://ogc.osd.mil/doha/SEAD4 20170608.pdf.

2 Some details were excluded to protect Applicant’s right to privacy. Specific information is available in the cited exhibits. 3 A debt that became delinquent several years ago is still considered recent because “an applicant’s ongoing, unpaid debts evidence a continuing course of conduct and, therefore, can be viewed as recent for purposes of the Guideline F mitigating conditions.” ISCR Case No. 15-06532 at 3 (App. Bd. Feb. 16, 2017) (citing ISCR Case No. 15-01690 at 2 (App. Bd. Sept. 13, 2016)). 4 Of course, Applicant loses some mitigating credit because some debt payments were made through garnishment of her salary even though her opportunity to establish a payment plan is reduced because of her limited income and other financial commitments. Payment of a debt “though garnishment rather than a voluntary effort diminishes its mitigating force.” Compare ISCR Case No. 08-06058 at 4 (App. Bd. Aug. 26, 2010) with ISCR Case No. 04-07360 at 2-3 (App. Bd. Sept. 26, 2006) (payment of two of four debts through garnishment did not bar mitigation of financial considerations concerns). See also ISCR Case No. 09-05700 at 4 (App. Bd. Feb. 24, 2011) (garnished payments towards delinquent tax debts is not mitigating information in light of other factors); ISCR Case No. 08-06058 at 6 (App. Bd. Sep. 21, 2009) (remanding the case to the administrative judge and stating when addressing an Internal Revenue Service garnishment, “On its face, satisfaction of a debt through the involuntary establishment of a creditor’s garnishment is not the same as, or similar to, a good-faith initiation of repayment by the debtor.”). 5 Applicant has the burden of proving the applicability of any mitigating conditions, and the burden to disprove a mitigating condition never shifts to the Government. 6 “Even if Applicant’s financial difficulties initially arose, in whole or in part, due to circumstances outside his [or her] control, the Judge could still consider whether Applicant has since acted in a reasonable manner when dealing with those financial difficulties.” ISCR Case No. 05-11366 at 4 n.9 (App. Bd. Jan. 12, 2007) (citing ISCR Case No. 99-0462 at 4 (App. Bd. May 25, 2000); ISCR Case No. 99-0012 at 4 (App. Bd. Dec. 1, 1999); ISCR Case No. 03-13096 at 4 (App. Bd. Nov. 29, 2005)). A component is whether he or she maintained contact with creditors and attempted to negotiate partial payments to keep debts current.

7 The Appeal Board has previously explained what constitutes a “good faith” effort to repay overdue creditors or otherwise resolve debts:

In order to qualify for application of [the “good faith” mitigating condition], an applicant must present evidence showing either a good-faith effort to repay overdue creditors or some other good-faith action aimed at resolving the applicant’s debts. The Directive does not define the term ‘good-faith.’ However, the Board has indicated that the concept of good- faith ‘requires a showing that a person acts in a way that shows reasonableness, prudence, honesty, and adherence to duty or obligation.’ Accordingly, an applicant must do more than merely show that he or she relied on a legally available option (such as bankruptcy) in order to claim the benefit of [the “good faith” mitigating condition].

(internal citation and footnote omitted) ISCR Case No. 02-30304 at 3 (App. Bd. Apr. 20, 2004) (quoting 8 Failure to maintain financial responsibility may raise a security concern. The Government has the option of following-up with more questions about Applicant’s finances. The Government can re-validate Applicant’s financial status at any time through credit reports, investigation, and interrogatories. Approval of a clearance now does not bar the Government from subsequently revoking it, if warranted. “The Government has the right to reconsider the security significance of past conduct or circumstances in light of more recent conduct having negative security significance.” ISCR Case No. 10-06943 at 4 (App. Bd. Feb. 17, 2012). An administrative judge does not have “authority to grant an interim, conditional, or probationary clearance.” ISCR Case No. 10-06943 at 4 (App. Bd. Feb. 17, 2012) (citing ISCR Case No. 10- 03646 at 2 (App. Bd. Dec. 28, 2011)). See also ISCR Case No. 04-03907 at 2 (App. Bd. Sep. 18, 2006) (stating, “The Board has no authority to grant [a]pplicant a conditional or probationary security clearance to allow her the opportunity to have a security clearance while she works on her financial problems.”). This footnote does not imply that granting Applicant’s security clearance is conditional.