ISCR Case 15-03992.h1

Case Headnote

ISCR Case No. 15-03992.h1

grantedJul 21, 2016· Hon. Darlene Lokey Anderson· hearing

Summary

A 48-year-old married Program Manager for a defense contractor was granted a security clearance despite allegations under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The government alleged the applicant was financially overextended, with debts exceeding $100,000, including a $99,986 equity line of credit from a 2010 house foreclosure and a charged-off credit card account for approximately $2,932. A second credit card account with the same creditor, though not alleged in the Statement of Reasons (SOR), was also paid in full.

Additionally, the government alleged the applicant engaged in questionable judgment and lacked candor by failing to provide truthful answers during the security clearance process. Specifically, this related to his financial disclosures.

However, the judge found that the applicant's financial issues were largely beyond his control, stemming from a high-risk mortgage and subsequent foreclosure. He demonstrated a good-faith effort to resolve his debts, settling all those listed in the SOR. The judge also determined that the applicant lacked intent to conceal information on his security clearance application, as he genuinely believed he had no delinquent debts. Consequently, the security clearance was granted.

Why the Applicant Prevailed

The applicant demonstrated that his financial problems were largely beyond his control due to a high-risk mortgage and subsequent foreclosure.
He provided evidence of a good-faith effort to resolve his debts, including settling all debts listed in the SOR.
The applicant's lack of intent to conceal information on his security clearance application was established, as he believed he had no delinquent debts.

Conditions Referenced

Disqualifying

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

Mitigating

20(b)appliedConditions Largely Beyond the Person's Control
20(c)appliedReceived Counseling or Indications That the Problem Is Being Resolved
20(d)appliedGood-faith Effort to Repay Overdue Creditors

Key Rule Quoted

“The adjudicative process is an examination of a sufficient period of a person’s life to make an affirmative determination that the person is an acceptable security risk.”

Procedural Posture

SOR issuedDec 14, 2015
Answer filedFeb 16, 2015
Hearing heldJun 1, 2016
Decision dateJul 21, 2016

Cite For

Mitigation of Financial Issues Under Guideline F Due to Circumstances Beyond Control
Lack of Intent to Conceal Financial Issues in Security Clearance Applications
Good-faith Efforts to Resolve Debts as a Mitigating Factor

Editorial summary generated for research. Not legal advice; not a prediction. Verify against the full decision before relying on any quoted language.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a	The Government alleges that the Applicant is ineligible for clearance because he has engaged in conduct involving questionable judgment, lack of candor, dishonesty, or unwillingness to protect classified information. Of special interest is any failure to provide truthful and candid answers during the security clearance process or any other failure to cooperate with the security clearance process.	For Applicant	Lack of Candor in InterviewNOT DELIBERATE	—	Denied	—	—	—

Allegation

Finding

Conduct

Concealed Issue

Response

Disqualifying (¶16)

Mitigating applied (¶17)

Mitigation

2.a

The Government alleges that the Applicant is ineligible for clearance because he has engaged in conduct involving questionable judgment, lack of candor, dishonesty, or unwillingness to protect classified information. Of special interest is any failure to provide truthful and candid answers during the security clearance process or any other failure to cooperate with the security clearance process.

For Applicant

Lack of Candor in InterviewNOT DELIBERATE

—

Denied

—

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant is ineligible for clearance because he is financially overextended and at risk of having to engage in illegal acts to generate funds.	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (c) received/receiving counseling; problem being resolved (d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.b	At one time Applicant was indebted to the creditors set forth in the SOR for an amount totaling in excess of $100,000. $100,000	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (c) received/receiving counseling; problem being resolved (d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.c	In 2010, Applicant’s house was foreclosed upon and sold. Applicant became indebted to the lender for the second loan on the property, an equity line of credit in the approximate amount of $99,986. $99,986	For Applicant	Mortgage or Home Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (c) received/receiving counseling; problem being resolved (d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.d	A credit card account became delinquent and was charged off in the approximate amount of $2,932. $2,932	For Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (c) received/receiving counseling; problem being resolved (d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.e	Applicant had a second credit card account with the same creditor that was not alleged in the SOR. This account was also paid in full.	For Applicant	Credit Card Debt	Admitted	—	—	Documented Debt Paid in Full

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Applicant is ineligible for clearance because he is financially overextended and at risk of having to engage in illegal acts to generate funds.

For Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(b) conditions largely beyond the person’s control; acted responsibly

(c) received/receiving counseling; problem being resolved

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.b

At one time Applicant was indebted to the creditors set forth in the SOR for an amount totaling in excess of $100,000.

$100,000

For Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(b) conditions largely beyond the person’s control; acted responsibly

(c) received/receiving counseling; problem being resolved

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.c

In 2010, Applicant’s house was foreclosed upon and sold. Applicant became indebted to the lender for the second loan on the property, an equity line of credit in the approximate amount of $99,986.

$99,986

For Applicant

Mortgage or Home Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(b) conditions largely beyond the person’s control; acted responsibly

(c) received/receiving counseling; problem being resolved

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.d

A credit card account became delinquent and was charged off in the approximate amount of $2,932.

$2,932

For Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(b) conditions largely beyond the person’s control; acted responsibly

(c) received/receiving counseling; problem being resolved

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.e

Applicant had a second credit card account with the same creditor that was not alleged in the SOR. This account was also paid in full.

For Applicant

Credit Card Debt

Admitted

—

Documented

Debt Paid in Full

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Case Profile

Summary

Why the Applicant Prevailed

Conditions Referenced

Key Rule Quoted

Procedural Posture

Cite For

Full decision

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

APPEARANCES

STATEMENT OF CASE

FINDINGS OF FACT

POLICIES

CONCLUSION

FORMAL FINDINGS

DECISION