CASE · Clearance Adjudication Search EngineCASE

Loading case…

ISCR Case 15-02643.h1 — CASE

ISCR Case 15-02643.h1granted

Case Headnote

ISCR Case No. 15-02643.h1

grantedApr 24, 2017· Hon. Nichole L. Noel· hearing

Summary

This case concerns a 33-year-old applicant, employed since 2014, whose security clearance was initially questioned under Guideline F (Financial Considerations). The Statement of Reasons (SOR) specifically cited the applicant's Chapter 7 bankruptcy filing in 2015, which resolved over $43,000 in debt. This raised a disqualifying condition under Adjudicative Guideline (AG) ¶ 19.

However, the judge applied mitigating conditions under AG ¶ 20(c). It was determined that the applicant's financial issues, including the substantial debt, were fully resolved through the Chapter 7 bankruptcy prior to the issuance of the SOR.

Crucially, there was no evidence presented of any ongoing financial problems following the bankruptcy discharge. Based on the resolution of all cited financial concerns, the security clearance was GRANTED.

Why the Applicant Prevailed

The applicant resolved over $43,000 in debt through Chapter 7 bankruptcy before the SOR was issued.
There was no evidence of ongoing financial problems after the bankruptcy discharge.

Conditions Referenced

Disqualifying

AG ¶ 19raisedFinancial ConsiderationsThe applicant's history of financial problems indicated an inability to pay creditors.

Mitigating

AG ¶ 20(c)appliedFinancial ConsiderationsThe applicant's financial problems were resolved through bankruptcy.

Key Rule Quoted

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

Procedural Posture

SOR issuedSep 29, 2015
Answer filed—Applicant requested a decision without a hearing.
Hearing held—No hearing was conducted.
Decision dateApr 24, 2017

Cite For

Resolution of Financial Issues Through Bankruptcy Under Guideline F
Absence of Ongoing Financial Problems as a Mitigating Factor
Consideration of the Whole-person Concept 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.

Standardized Decision Profile

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

Posture: Decision on RecordDecided: granted

The judge found that the applicant resolved over $43,000 in debt through Chapter 7 bankruptcy prior to the issuance of the Statement of Reasons. The judge determined that there was no evidence of ongoing financial problems, leading to a decision to grant the applicant eligibility for a security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant filed for and received bankruptcy protection in 2015. $43,000	For Applicant	Bankruptcy Filing	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(c) received/receiving counseling; problem being resolved	—

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. 15-02643 ) Applicant for Security Clearance )

For Government: Benjamin R. Dorsey, Esq., Department Counsel For Applicant: Pro se 04/24/2017 ______________

STATEMENT OF CASE

______________

NOEL, Nichole L., Administrative Judge:

Applicant contests the Department of Defense’s (DOD) intent to deny his eligibility for a security clearance. He resolved over $43,000 in debt through Chapter 7 bankruptcy before the Government issued the Statement of Reasons (SOR). The record does not contain any evidence of ongoing financial problems. Clearance is granted.

Statement of the Case

On September 29, 2015, the DOD issued a SOR detailing security concerns under the financial considerations guideline.1 DOD adjudicators were unable to find that it is clearly consistent with the national interest to grant Applicant’s security clearance and recommended his case be submitted to an administrative judge for consideration. Applicant answered the SOR and requested a decision without a hearing.2 The Government submitted its written case on February 2, 2016. A complete copy of the file of relevant material (FORM) and the Directive were provided to Applicant. He received the FORM on February 11, 2016, and did not respond. The case was assigned to me on May 24, 2016. The documents appended to the FORM are admitted as Government’s Exhibits (GE) 1 through 3, and 5 through 8, without objection. GE 4 is excluded as explained below.

PROCEDURAL MATTERS

GE 4 is a report of investigation (ROI) summarizing the interview Applicant had with an investigator during his October 2014 background investigation. The interview, which contains adverse information, is not authenticated as required under ¶ E3.1.20 of the Directive. Footnote 1 of the FORM advises Applicant of that fact and further cautions him that if he fails to object to the admission of the interview summary in his response to the FORM that his failure may be taken as a waiver of the authentication requirement. Applicant’s failure to respond to the FORM does not demonstrate that he understands the concepts of authentication, waiver, and admissibility. It also does not establish that he understands the implications of waiving an objection to the admissibility of the interview. Accordingly, GE 4 is inadmissible and I have not considered it.

FINDINGS OF FACT

Applicant, 33, has worked for his current employer since 2014. He completed a security clearance application, his first, in August 2014. Applicant disclosed that he planned to file for Chapter 7 bankruptcy protection. He filed the petition in February 2015, seeking relief from $43,189 in debt. According to the bankruptcy petition, $18,000 of that amount may have been for a duplicate account. The bankruptcy court discharged Applicant’s debts in May 2015. The record does not contain any information about Applicant’s finances after the discharge.

POLICIES

When evaluating an applicant’s suitability for a security clearance, the administrative judge must consider the adjudicative guidelines. 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 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.

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 security decision.

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

Unresolved delinquent debt is a serious security concern because failure to “satisfy debts [or] 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.”3

The SOR contains one allegation, that Applicant filed for and received bankruptcy protection in 2015. The act of filing for bankruptcy protection may suggest that an application has financial problems that raise a security concern. Here, Applicant sought relief from $43,000 of debt he incurred over nine years. This indicates that Applicant experienced a history of financial problems that resulted in an inability to pay his creditors, which is disqualifying.4 Applicant filed for bankruptcy protection as a legitimate method of resolving his debt, which were discharged five months before the SOR issued. Applicant’s financial problems are resolved and the related security concerns mitigated.5

Based on the written record, I have no doubts about Applicant’s suitability for access to classified information. In reaching this conclusion, I have also considered the whole-person factors at AG ¶ 2(a). The record does not contain any evidence to suggest that Applicant has ongoing financial problems or habits that reflect negatively on his current security worthiness.

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, Financial Considerations: FOR APPLICANT

Subparagraph 1.a: For Applicant

CONCLUSION

Based on the record, it is clearly consistent with the national interest to grant Applicant eligibility for a security clearance. Eligibility for access to classified information is granted.

________________________ Nichole L. Noel Administrative Judge

FOOTNOTES

1 This case is adjudicated under Executive Order (EO) 10865, Safeguarding Classified Information within Industry, signed by President Eisenhower on February 20, 1960, as amended; as well as DOD Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program, dated January 2, 1992, as amended (Directive). In addition, the Adjudicative Guidelines for Determining Eligibility for Access to Classified Information (AG), effective within the Defense Department on September 1, 2006, apply to this case. The AG were published in the Federal Register and codified in 32 C.F.R. § 154, Appendix H (2006). The AG replace the guidelines in Enclosure 2 to the Directive. 2 GE 3. 3 AG ¶ 18.

4 AG ¶¶ 19(a) and (c).

5 AG ¶ 20(c).