CASE · Clearance Adjudication Search EngineCASE

Loading case…

ISCR Case 05-05428.h1 — CASE

ISCR Case 05-05428.h1denied

Case Headnote

ISCR Case No. 05-05428.h1

deniedMay 21, 2007· Hon. Joseph Testan· hearing

Summary

A 61-year-old defense contractor was denied a security clearance due to long-standing financial difficulties and a failure to disclose material financial information on his Security Clearance Application (SCA). The denial was based on Guideline E (Personal Conduct) and Guideline F (Financial Considerations), with the judge concluding that granting access to classified information was not consistent with national interest.

The Statement of Reasons included allegations that the applicant failed to disclose material financial information on his SCA and provided false material information in response to two questions. The applicant admitted to being indebted as alleged in multiple specific allegations. Disqualifying conditions raised included E2.A6.1.2.1, E2.A6.1.2.3, and E2.A5.1.2.2.

The denial was specifically attributed to the applicant's history of significant financial difficulties dating back to at least 1999. Furthermore, he failed to disclose multiple bankruptcy filings on his SCA, providing false information instead. These issues were determined to reflect adversely on his judgment and reliability.

Why the Applicant Was Denied

Applicant has a history of significant financial difficulties since at least 1999.
Applicant failed to disclose multiple bankruptcy filings on his SCA, providing false information instead.
The applicant's financial irresponsibility reflects adversely on his judgment and reliability.

Conditions Referenced

Disqualifying

E2.A6.1.2.1raisedHistory of Not Meeting Financial Obligations
E2.A6.1.2.3raisedInability or Unwillingness to Satisfy Debts
E2.A5.1.2.2raisedDeliberate Omission, Concealment, or Falsification of Relevant and Material Facts

Key Rule Quoted

“When such an individual intentionally falsifies material facts on an SCA, it is extremely difficult to conclude that he or she nevertheless possesses the good judgment, reliability and trustworthiness required of clearance holders.”

Procedural Posture

SOR issuedNov 7, 2005
Answer filedJan 31, 2007Applicant elected to have his case determined on a written record.
Hearing held—No hearing; case determined on written record.
Decision dateMay 21, 2007

Cite For

Denial Based on Financial Irresponsibility Under Guideline F
Failure to Disclose Material Information Under Guideline E
Impact of Falsification on 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 E (Personal Conduct) · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The judge found against the applicant on allegations of personal conduct due to intentional falsifications on a Security Clearance Application (SCA). The applicant's failure to disclose material financial information and the deliberate omission of bankruptcy filings were significant concerns that led to the denial of his security clearance.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
1	Applicant’s failure to disclose material information about his finances on a Security Clearance Application (SCA)	Against Applicant	Omission or Failure to DiscloseFOUND DELIBERATE	Financial	Denied	(b) deliberately providing false information to an investigator or official	—	—
2	Applicant provided false, material information in response to two questions on the SCA.	Against Applicant	Falsification Security FormFOUND DELIBERATE	Financial	Denied	(b) deliberately providing false information to an investigator or official	—	—

Descriptive standardized rendering of a decided public case (Guideline E). The verbatim source decision is shown in full below.

Standardized Decision Profile

SEAD-4 Guideline F · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The applicant has a long history of financial difficulties, including multiple Chapter 13 bankruptcy filings and significant outstanding debts. The judge found that the applicant's financial issues and failure to disclose relevant information on his Security Clearance Application precluded a favorable decision regarding his security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.e	Applicant admits he is indebted as alleged in SOR Allegations 1e through 1o.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.f	Applicant admits he is indebted as alleged in SOR Allegations 1e through 1o.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.g	Applicant admits he is indebted as alleged in SOR Allegations 1e through 1o.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.h	Applicant admits he is indebted as alleged in SOR Allegations 1e through 1o.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.i	Applicant admits he is indebted as alleged in SOR Allegations 1e through 1o.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.j	Applicant admits he is indebted as alleged in SOR Allegations 1e through 1o.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.k	Applicant admits he is indebted as alleged in SOR Allegations 1e through 1o.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.l	Applicant admits he is indebted as alleged in SOR Allegations 1e through 1o.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.m	Applicant admits he is indebted as alleged in SOR Allegations 1e through 1o.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—

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

SYNOPSIS

KEYWORD: Financial; Personal Conduct

DIGEST: Applicant’s long-standing financial difficulties, and his failure to disclose material information about his finances on a Security Clearance Application (SCA), preclude a finding that it is clearly consistent with the national interest to grant him access to classified information. Clearance is denied.

CASENO: 05-05428.h1

DATE: 05/21/2007

DATE: May 21, 2007

) ) In Re: ) ) ISCR Case No. 05-05428 ---------------------- ) SSN: ----------- ) ) Applicant for Security Clearance )

DECISION OF ADMINISTRATIVE JUDGE JOSEPH TESTAN

APPEARANCES

SYNOPSIS

Applicant’s long-standing financial difficulties, and his failure to disclose material information about his finances on a Security Clearance Application (SCA), preclude a finding that it is clearly consistent with the national interest to grant him access to classified information. Clearance is denied.

STATEMENT OF CASE

On November 7, 2005, the Defense Office of Hearings and Appeals (DOHA), pursuant to Executive Order 10865 and Department of Defense Directive 5220.6 (Directive), dated January 2, 1992, issued a Statement of Reasons (SOR) to applicant which detailed reasons why DOHA could not make the preliminary affirmative finding under the Directive that it is clearly consistent with the national interest to grant or continue a security clearance for applicant and recommended referral to an Administrative Judge to determine whether clearance should be denied or revoked.

Applicant responded to the SOR in writing on January 31, 2007, and elected to have his case determined on a written record in lieu of a hearing. Department Counsel submitted the Government's written case (FORM) on or about February 27, 2007. Applicant filed a response to the FORM on or about March 31, 2007. The case was assigned to me on April 18, 2007.

FINDINGS OF FACT

Applicant is a 61 year old employee of a defense contractor.

Applicant has been experiencing significant financial difficulties since at least 1999. He has filed for Chapter 13 bankruptcy protection four times. His first Chapter 13 petition was filed in 1999; the case was dismissed sometime in 2002. His second Chapter 13 petition was filed in September 2002. It was dismissed in May 2003. His third Chapter 13 petition was filed in September 2004, and was dismissed in August 2005. Applicant’s last Chapter 13 petition was filed in September 2005. A repayment plan was approved by the bankruptcy court, and pursuant to that plan, applicant has been making monthly payments of approximately $800.00 to the bankruptcy trustee since December 2005. As of August 2006, he had paid the trustee $6,865.45, and had a plan balance of approximately $43,884.00. Applicant’s primary reason for repeatedly filing Chapter 13 petitions was to keep his house out of foreclosure.

Applicant admits he is indebted as alleged in SOR Allegations 1e through 1o. These

Despite his admission, it appears the debts alleged in SOR Paragraphs 1land 1mare the same. allegations are therefore incorporated by reference as Findings of Fact. A letter from his bankruptcy lawyer (Exhibit 19) states the debts listed in the SOR are part of the current bankruptcy case, and when the payment plan is completed, these debts will be discharged. Since the bankruptcy schedules are not part of the record, this assertion cannot be corroborated.

Applicant completed and executed an SCA in August 2004 (Exhibit 6). He provided false, material information in response to two questions on the SCA. In response to Question 33, he stated he had not filed a bankruptcy petition during the previous seven years In fact, he had filed two bankruptcy petitions during that time period. In response to Question 38, he falsely stated that during the previous seven years he had not been over 180 days delinquent on any debt. In a January 2005 signed statement he gave to an OPM investigator (Exhibit 9), applicant stated he didn’t include his bankruptcies on the SCA because he “did not think a bankruptcy was relevant.”

CONCLUSION

With respect to Guideline F, the evidence establishes that applicant has been experiencing significant financial difficulties since at least 1999. Applicant’s failure to honor his financial obligations reflects adversely on his judgment and reliability, and suggests he cannot be relied upon to safeguard classified information. With respect to the Financial Considerations guideline, Disqualifying Conditions E2.A6.1.2.1 (a history of not meeting financial obligations) and E2.A6.1.2.3 (inability or unwillingness to satisfy debts) are applicable.

Once the Government established a prima facie case under Guideline F, the burden shifted to applicant to show he has reformed. Applicant did not meet his burden. Applicant has made significant progress with his most recent bankruptcy case, as evidenced by his payment of nearly $7,000.00 to the bankruptcy trustee. For this he deserves credit. However, he still owes the bankruptcy trustee over $40,000.00, and in view of his previous failures to complete Chapter 13 payment plans, it is too soon to safely conclude that he will complete this plan and that his financial difficulties are behind him. No mitigating conditions are applicable, and Guideline F is found against applicant.

With respect to Guideline E, applicant’s falsifications of material facts on the SCA are troubling. The Government relies heavily on the honesty and integrity of individuals seeking access to our nation’s secrets. When such an individual intentionally falsifies material facts on an SCA, it is extremely difficult to conclude that he or she nevertheless possesses the good judgment, reliability and trustworthiness required of clearance holders. Applicant’s intentional falsifications require application of Disqualifying Condition E2.A5.1.2.2 (the deliberate omission, concealment, or falsification of relevant and material facts from any personnel security questionnaire . . .). No Mitigating Conditions apply. Based on the foregoing, Guideline E is found against applicant.

FORMAL FINDINGS

PARAGRAPH 1: AGAINST THE APPLICANT

PARAGRAPH 2: AGAINST THE APPLICANT

DECISION

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 a security clearance for applicant.

Joseph Testan Administrative Judge

FOOTNOTES

FOR GOVERNMENT Pamela C. Benson, Department Counsel

FOR APPLICANT Pro Se