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ISCR Case 14-06211.h1 — CASE

ISCR Case 14-06211.h1granted

Case Headnote

ISCR Case No. 14-06211.h1

grantedJan 25, 2017· Hon. Richard A. Cefola· hearing

Summary

A 59-year-old shipper/receiver/truck driver was granted a security clearance despite initial concerns under Guideline F (Financial Considerations). The Statement of Reasons alleged four specific debts. The applicant denied indebtedness to Creditor A for approximately $266,439 from a mortgage foreclosure, and to Creditor B for about $10,362 from a motor vehicle loan. He also denied owing Creditor D approximately $2,127. For Creditor C, he admitted an outstanding debt but disputed the amount, stating it was $508, not the $4,877 alleged by the government.

Disqualifying conditions AG ¶ 19(a) and AG ¶ 19(c) were raised, but mitigating conditions AG ¶ 20(b) and AG ¶ 20(d) were applied. The judge determined that the applicant's financial difficulties primarily stemmed from circumstances beyond his control, specifically his wife's unemployment and family obligations.

Furthermore, the applicant demonstrated good-faith efforts to resolve his debts, significantly reducing the amounts owed. The judge concluded that his current financial situation did not compromise his reliability or trustworthiness, leading to the decision to grant the security clearance.

Why the Applicant Prevailed

The applicant demonstrated that his financial difficulties were largely due to circumstances beyond his control, including his wife's unemployment and family obligations.
He made good-faith efforts to address his debts, significantly reducing the amounts owed.
The applicant's current financial situation did not cast doubt on his reliability or trustworthiness.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations

Mitigating

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

Key Rule Quoted

“The protection of the national security is the paramount consideration.”

Procedural Posture

SOR issuedFeb 24, 2015
Answer filedMay 26, 2015
Hearing held—Applicant appeared pro se.
Decision dateJan 25, 2017

Cite For

Mitigation of Financial Difficulties Under Guideline F Due to Circumstances Beyond Control
Good-faith Efforts to Resolve Debts
Whole-person Concept in Evaluating 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: granted

The judge found that the applicant's financial difficulties were largely due to circumstances beyond his control, including his wife's unemployment and the need to support her mother. All allegations under Guideline F were resolved in favor of the applicant, leading to the granting of his security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant denies that he is indebted to Creditor A, as the result of a mortgage foreclosure, in the amount of about $266,439. $266,439	For Applicant	Mortgage or Home Loan Debt	Denied	—	—	—
1.b	Applicant denies that he is indebted to Creditor B, as the result of a motor vehicle loan, in the amount of about $10,362. $10,362	For Applicant	Auto Loan Debt	Denied	—	—	—
1.c	Applicant admits that he is indebted to Creditor C, however, the past-due amount according to the Government’s most recent credit report is $508, not the $4,877 alleged. $508	For Applicant	Unspecified Financial	Admitted	—	—	—
1.d	Applicant denies that he is indebted to Creditor D in the amount of about $2,127. $2,127	For Applicant	Unspecified Financial	Denied	—	—	—

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: 14-06211 ) Applicant for Security Clearance )

For Government: Stephanie C. Hess, Esquire, Department Counsel For Applicant: Pro se

January 25, 2017 ______________

STATEMENT OF CASE

______________

CEFOLA, Richard A., Administrative Judge:

Applicant submitted his Electronic Questionnaires for Investigations Processing (e-QIP) on November 1, 2011. On February 24, 2015, the Department of Defense (DOD) issued a Statement of Reasons (SOR) detailing the security concerns under Guideline F for Applicant. The action was taken under Executive Order 10865, Safeguarding Classified Information Within Industry (February 20, 1960), as amended; Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines (AG), effective within the Department of Defense after September 1, 2006.

Applicant answered the SOR in writing (Answer) on May 26, 2015, and requested an Administrative Determination by an administrative judge. Department Counsel issued a File of Relevant Material (FORM) on January 27, 2016. Applicant did not respond to the FORM. The case was assigned to me on August 22, 2016. Based upon a review of the pleadings and exhibits, eligibility for access to classified information is granted.

FINDINGS OF FACT

In his Answer to the SOR, Applicant admitted the factual allegations in Paragraph 1.c. of the SOR, with explanation. He denied the factual allegations in Paragraphs 1.a., 1.b. and 1.d. of the SOR.

Guideline F – Financial Considerations

Applicant is a 59 year old “shipper/receiver/truck driver,” who holds a secret security clearance. (Item 4 at pages 5, 9 and 22.) Applicant wife lost her “job in December of 2007,” and did not find employment “until 2010.” (Answer at page 10.) With the death of her “Dad in August of 2013,” they have also “been helping her [mother] out” financially. (Id.) These occurrences caused Applicant’s alleged financial difficulties.

1.a. Applicant denies that he is indebted to Creditor A, as the result of a mortgage foreclosure, in the amount of about $266,439. In his Answer Applicant avers “Foreclosure has been discussed but not determined to date [May 26, 2015].” (Answer at page 1.) The Government’s most recent, September 2015, credit report supports Applicant’s averment as it shows that the mortgage is not past due. (Item 6 at page 1.)

1.b. Applicant denies that he is indebted to Creditor B, as the result of a motor vehicle loan, in the mount of about $10,362. In his Answer Applicant avers “we paid the negotiated amount, then it was determined the debt was satisfied.” He further avers that the debt “was lowered to $3,000.00 of which we paid a total of $2,150.00” (Answer at page 3), and submits a court document noting “no ability to pay currently” (Answer at page 4). Based his submissions, Applicant now owes at most $850 to Creditor B for this past-due debt. I find that he is making good-faith effort to address this debt; and as such, this allegation is found for Applicant.

1.c. Applicant admits that he is indebted to Creditor C, however, the past-due amount according to the Government’s most recent credit report is $508, not the $4,877 alleged, which is the “Balance” due, but not past due, on this debt. (Item 6 at page 4.)

1.d. Applicant denies that he is indebted to Creditor D in the amount of about $2,127. In his Answer Applicant avers “We paid the negotiated amount and the balance remaining was processed thru our taxes on a 1099 (see attached).” The attached documents support Applicant’s averment. (Answer at pages 4–9.) This allegation is found for Applicant.

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 to be used 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, administrative judges apply the guidelines in conjunction with the factors listed in AG ¶ 2 describing the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. According to AG ¶ 2(c), 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 to classified information will be resolved in favor of 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 the applicant or proven by Department Counsel.” The applicant has the ultimate burden of persuasion to obtain a favorable clearance 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 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 adverse 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 for Financial Considerations is set out in AG ¶ 18, as follows:

Failure or inability 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 information. An individual who is financially overextended is at risk of having to engage in illegal acts to generate funds.

AG ¶ 19 describes two conditions that could raise security concerns and may be disqualifying in this case:

(a) inability or unwillingness to satisfy debts; and

Applicant has a history of financial indebtedness documented by the credit reports in evidence, which substantiate all of the allegations. He has been unable or unwilling to address two his delinquencies. The evidence raises security concerns under both of these disqualifying conditions, thereby shifting the burden to Applicant to rebut, extenuate, or mitigate those concerns.

The guideline includes five conditions in AG ¶ 20 that could mitigate security concerns arising from Applicant’s financial difficulties:

(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, or a death, divorce or separation), and the individual acted responsibly under the circumstances;

(c) the person has received or is receiving counseling for the problem and/or there are clear indications that the problem is being resolved or is under control; (d) the individual initiated 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.

Applicant’s financial problems are directly related to his spouse’s unemployment, and their financial support of her mother, conditions which were beyond his control. The $1,358 that is arguably still owed pales in comparison to the $283,805 alleged. Applicant has established that he has acted reasonably or responsibly under the circumstances. Mitigation under AG ¶ 20(b) has been established.

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 relevant circumstances. The administrative judge should consider the nine adjudicative process factors listed at AG ¶ 2(a):

(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 the potentially disqualifying and mitigating conditions in light of all the facts and circumstances surrounding this case. I have incorporated my comments under Guideline F in my whole-person analysis. Some of the factors in AG ¶ 2(a) were addressed under that guideline, but some warrant additional comment. Applicant’s financial problems remain unresolved. However, he has submitted a statement from his wife as to his character and the genesis of the past-due debts, which establish the debts were incurred due to circumstances beyond his control. He has acted responsibly by resolving the vast majority of his debt. He can be trusted to continue to resolve his delinquent accounts. Overall, the record evidence leaves me with questions and doubts as to Applicant’s eligibility and suitability for a security clearance. For all these reasons, I conclude Applicant mitigated the Financial Considerations security concerns.

FORMAL FINDINGS

Formal findings for or against Applicant on the allegations set forth in the SOR, as required by ¶ E3.1.25 of Enclosure 3 of the Directive, are:

Paragraph 1, Guideline F: FORAPPLICANT

Subparagraph 1.a. For Applicant

Subparagraph 1.b. For Applicant

Subparagraph 1.c. For Applicant

Subparagraph 1.d. For Applicant

CONCLUSION

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

________________________ Richard A. Cefola Administrative Judge