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ISCR Case 15-03856.h1 — CASE

ISCR Case 15-03856.h1denied

Case Headnote

ISCR Case No. 15-03856.h1

deniedAug 11, 2017· Hon. Richard A. Cefola· hearing

Summary

A 48-year-old electrical contractor was denied a security clearance under Guideline F, Financial Considerations, due to significant past-due debts and delinquent child support. The Statement of Reasons included allegations that the applicant owed approximately $506 to a cable/cellular provider and an outstanding judgment of about $5,387, both of which he denied. However, the applicant admitted to owing approximately $10,000 in delinquent child support.

The judge determined that the applicant had significant past-due indebtedness, including the delinquent child support. Disqualifying conditions under AG ¶ 19(a), AG ¶ 19(b), and AG ¶ 19(c) were raised.

The denial was based on the applicant's failure to mitigate these financial concerns. Specifically, he did not take any action to address his proven past-due debts and failed to provide evidence of financial counseling or a good-faith effort to repay them. Consequently, the security clearance was denied.

Why the Applicant Was Denied

The applicant has significant past-due indebtedness, including delinquent child support.
The applicant did not take any action to address his proven past-due debts.
The applicant failed to provide evidence of financial counseling or a good-faith effort to repay debts.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability to Satisfy Debts
AG ¶ 19(b)raisedUnwillingness to Satisfy Debts Regardless of the Ability to Do So
AG ¶ 19(c)raisedHistory of Not Meeting Financial Obligations

Key Rule Quoted

“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.”

Procedural Posture

SOR issuedDec 13, 2015
Answer filedDec 29, 2015
Hearing held—Decided on the written record without a hearing.
Decision dateAug 11, 2017

Cite For

Failure to Mitigate Financial Difficulties Under Guideline F
Significant Past-due Debts as a Disqualifying Condition
Importance of Addressing Financial Obligations for 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: denied

The judge found significant financial concerns under Guideline F, including multiple past-due debts and delinquent child support. The applicant's failure to address these debts led to a decision against him on most allegations, with one allegation found for the applicant due to lack of evidence.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant denies that he owes a “Cable/Cellular” phone provider a past-due debt totaling about $506. $506	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.g	Applicant denies that he owes an outstanding judgment in an amount totaling about $5,387. $5,387	For Applicant	Unspecified Financial	Denied	—	—	—
1.h	Applicant admits that he owes “delinquent child support” in an amount of about $10,000. $10,000	Against Applicant	Child Support Debt	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—

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: 15-03856 ) Applicant for Security Clearance )

For Government: Charles Hale, Esquire, Department Counsel For Applicant: Pro se

August 11, 2017

______________

STATEMENT OF CASE

______________

CEFOLA, Richard A., Administrative Judge:

On July 10, 2013, Applicant submitted a security clearance application (SF-86). On December 13, 2015, the Department of Defense Consolidated Adjudications Facility (DoD CAF) issued Applicant a Statement of Reasons (SOR), detailing security concerns under Guideline F, Financial Considerations. (Item 1.) The action was taken under Executive Order 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended; DoD Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the Adjudicative Guidelines for Determining Eligibility for Access to Classified Information, effective within the DoD after September 1, 2006.

Applicant answered the SOR on December 29, 2015. He admitted six of the eight allegations, subparagraphs 1.b.~1.f., and 1.h. Applicant denied the allegations of subparagraphs 1.a. and 1.g., with brief comments, and requested that his case be decided by an administrative judge on the written record without a hearing. On February 17, 2016, Department Counsel submitted the Government’s written case. A complete copy of the File of Relevant Material (FORM), containing six Items, was mailed to Applicant on February 18, 2016, and received by him on March 2, 2016. The FORM notified Applicant that he had an opportunity to file objections and submit material in refutation, extenuation, or mitigation within 30 days of his receipt of the FORM. He did not respond to the FORM.

The SOR in this case was issued under the adjudicative guidelines that came into effect within the DoD on September 1, 2006. Security Executive Agent Directive (SEAD) 4, National Security Adjudicative Guidelines, implements new adjudicative guidelines, effective June 8, 2017. All national security eligibility decisions issued on or after June 8, 2017, are to be decided using the new National Security Adjudicative Guidelines for Determining Eligibility for Access to Classified Information or Eligibility to Hold a Sensitive Position (AG), as implemented by SEAD 4. I considered the previous adjudicative guidelines, effective September 1, 2006, as well as the new AG, effective June 8, 2017, in adjudicating Applicant’s national security eligibility. My decision would be the same under either set of guidelines, although this decision is issued pursuant to the new AG.

FINDINGS OF FACT

Applicant is 48 years old. (Item 3 at page 5.) He is an “electrical contractor,” and has worked for his present employer since December of 1999. (Item 3 at page 9.)

Guideline F – Financial Considerations

1.a. Applicant denies that he owes a “Cable/Cellular” phone provider a past-due debt totaling about $506. (Item 2 at page 2.) His only comment is that the creditor “provided poor service.” (Id.) Without further explanation; and the fact that this alleged past-due debt appears on the Government’s most recent November 2014 credit report (item 6 at page 1), this allegation is found against Applicant.

1.b. Applicant admits that he owes a past-due medical debt in the amount of about $422. (Item 2 at page 2.) This allegation is found against Applicant.

1.c. Applicant admits that he owes a past-due “Financial” account in the amount of about $6,349. (Item 2 at page 2.) This allegation is found against Applicant.

1.d. Applicant admits that he owes a past-due credit-card debt in the amount of about $380. (Item 2 at page 3.) This allegation is found against Applicant.

1.e. Applicant admits that he owes another past-due credit-card debt in the amount of about $463. (Item 2 at page 3.) This allegation is found against Applicant.

1.f. Applicant admits that he owes a third past-due credit-card debt in the amount of about $2,478. (Item 2 at page 3.) This allegation is found against Applicant. 1.g. Applicant denies that he owes an outstanding judgment in an amount totaling about $5,387. (Item 2 at page 3.) His only comment is “unknown account.” (Id.) However, this alleged outstanding judgment does not appear on any of the Government’s credit reports, this allegation is found for Applicant.

1.h. Applicant admits that he owes “delinquent child support” in an amount of about $10,000. (Item 2 at page 3.) This allegation is found against Applicant.

POLICIES

When evaluating an applicant’s suitability for national security eligibility, the administrative judge must consider the adjudicative guidelines. In addition to brief introductory explanations for each guideline, the adjudicative guidelines (AG) list potentially disqualifying conditions and mitigating conditions, which are to be used in evaluating an applicant’s national security eligibility.

These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, these guidelines are applied 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. The entire process is a conscientious scrutiny of applicable guidelines in the context 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 national security eligibility will be resolved in favor of the 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. I have not drawn inferences based on mere speculation or conjecture.

Directive ¶ E3.1.14, requires the Government to present evidence to establish controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, an “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, and has the ultimate burden of persuasion as to obtaining a favorable clearance decision.”

A person applying for national security eligibility seeks to enter 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 national security eligibility. 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 or sensitive information. Finally, as emphasized in Section 7 of Executive Order 10865, “[a]ny determination under this order adverse to an applicant shall be a determination 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 concerns relating to the guideline for financial considerations are set out in AG ¶ 18, which reads in pertinent part:

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. Financial distress can also be caused or exacerbated by, and thus can be a possible indicator of, other issues of personnel security concern such as excessive gambling, mental health conditions, substance misuse, or alcohol abuse or dependence. An individual who is financially overextended is at greater risk of having to engage in illegal or otherwise questionable acts to generate funds.

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

(a) inability to satisfy debts;

(b) unwillingness to satisfy debts regardless of the ability to do so; and

Applicant has significant past-due indebtedness, to include delinquent child support. These facts establish prima facie support for the foregoing disqualifying conditions, and shift the burden to Applicant to mitigate those concerns.

The guideline includes conditions in AG ¶ 20 that could mitigate the security concerns arising from Applicant’s alleged 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, 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;

(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;

(f) the affluence resulted from a legal source of income; and

(g) the individual has made arrangements with the appropriate tax authority to file or pay the amount owed and is in compliance with those arrangements.

None of these apply. Applicant has done nothing to address his proven past-due indebtedness.

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(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.

According to 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 applicable guidelines and the whole-person concept.

I considered the potentially disqualifying and mitigating conditions in light of all pertinent facts and circumstances surrounding this case. Overall, the record evidence leaves me with questions and doubts as to Applicant’s judgment, eligibility, and suitability for a security clearance. He has not met his burden to mitigate the security concerns arising under the guideline for financial considerations.

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: AGAINST APPLICANT

Subparagraphs 1.a. through 1.f.: Against Applicant

Subparagraph 1.g.: For Applicant

Subparagraph 1.h.: Against Applicant

CONCLUSION

In light of all of the circumstances presented by the record in this case, it is not clearly consistent with the national interest to grant Applicant national security eligibility and a security clearance. National security eligibility is denied.

________ Richard A. Cefola Administrative Judge