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ISCR Case 16-00126.h1 — CASE

ISCR Case 16-00126.h1denied

Case Headnote

ISCR Case No. 16-00126.h1

deniedMar 31, 2017· Hon. Robert Robinson Gales· hearing

Summary

A 35-year-old desktop support analyst was denied a security clearance due to concerns under Guidelines E (Personal Conduct), F (Financial Considerations), and J (Criminal Conduct). The denial stemmed from unresolved financial issues, a history of personal misconduct, and a lack of credibility in his financial disclosures. The judge determined that the applicant had not demonstrated sufficient rehabilitation or control over his financial situation, raising doubts about his reliability and trustworthiness.

Specifically, the applicant failed to disclose multiple delinquent accounts on his November 6, 2014 e-QIP, despite certifying its accuracy. These undisclosed debts included an Internet account ($659, collected 2011), an automobile insurance account ($206, collected 2010), a cellular phone account ($268, collected 2014), and an automobile dealer services account. Additionally, he had three Stafford subsidized student loans totaling $11,625, which became past due in December 2014.

Further, the applicant was fired from a previous employer after pawning a company laptop tablet for $200 to cover rent and vehicle repairs. He was subsequently charged with obtaining property under false pretenses and receipt of stolen goods, leading to pretrial intervention, community service, and eventual expungement of the record. The combination of these unresolved financial issues, the theft of company property, and the false statements on his application led to the denial of his security clearance.

Why the Applicant Was Denied

The applicant failed to resolve multiple delinquent debts totaling approximately $12,345.
The applicant's history of personal misconduct included theft and inappropriate use of company assets.
The applicant provided false information on his security clearance application regarding his financial history.

Conditions Referenced

Disqualifying

F1raisedFinancial Considerations
E2raisedPersonal Conduct
J1raisedCriminal Conduct

Key Rule Quoted

“Eligibility for a security clearance and access to classified information is denied.”

Procedural Posture

SOR issuedMay 16, 2016
Answer filedAug 12, 2016
Hearing heldDec 7, 2016
Decision dateMar 31, 2017

Cite For

Denial Based on Unresolved Financial Obligations Under Guideline F
Impact of Personal Conduct on Security Clearance Eligibility Under Guideline E
Importance of Truthful Disclosures in Security Clearance Applications Under Guideline J

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 all allegations under Guideline E, indicating that the applicant failed to mitigate concerns regarding personal conduct. The applicant's responses to questions on the e-QIP were deemed false, and the judge concluded that the applicant's conduct raised significant security concerns.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a	On November 6, 2014, when Applicant completed his e-QIP, some questions in Section 26 – Financial Record (Delinquency Involving Routine Accounts) asked if, in the past seven years, he had any possessions or property voluntarily or involuntarily repossessed or foreclosed; defaulted on any type of loan; had any bills or debts turned over to a collection agency; had his wages, benefits, or assets garnished or attached for any reason; and been over 120 days delinquent on any debt not previously entered. Applicant answered “no” to all of those questions. He certified that the response was “true, complete, and correct” to the best of his knowledge and belief, but the response to those questions was, in fact, false for Applicant had concealed multiple accounts that came within those parameters, including accounts in collection, defaulted student loans, and repossession of a vehicle.	Against Applicant	Falsification Security FormFOUND DELIBERATE	Financial	Denied	—	—	—

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 judge found against the applicant on the majority of financial allegations, indicating unresolved debts and a history of financial mismanagement. Although two minor debts were resolved, the applicant's overall financial situation was deemed insufficiently stable to mitigate security concerns, leading to a denial of the security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	an Internet account with an unpaid and past-due balance of $659 that was placed for collection in 2011 $659	For Applicant	Unspecified Financial	Admitted	—	—	—
1.c	an automobile insurance account with an unpaid balance of $206 that was placed for collection in 2010 $206	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.b	a cellular phone account with an unpaid and past-due balance of $268 that was placed for collection in 2014 $268	For Applicant	Unspecified Financial	Admitted	—	—	—
1.d	an automobile dealer services account for a 2006 car that Applicant purchased in 2006 $9,205	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.e	three Stafford subsidized student loans with a combined total of $11,625 that became $434 past due when Applicant stopped making payments in December 2014 $2,009	Against Applicant	Student Loan Debt	Admitted	—	—	—

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

Standardized Decision Profile

SEAD-4 Guideline J (Criminal Conduct) · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The judge ruled against the applicant on the criminal conduct allegation, finding that the applicant failed to mitigate the security concerns associated with his past criminal behavior. As a result, the applicant's request for a security clearance was denied.

¶	Allegation	Finding	Offense	Criminal disposition	Response	Disqualifying (¶31)	Mitigating applied (¶32)	Mitigation
3.a	Applicant was fired by an employer after he took a laptop tablet device that belonged to his employer from a storage locker and pawned it. He took the device because he needed the money to pay the rent and repair his vehicle. He received $200 for the device. About one month later, the police called him. He was subsequently charged with obtaining property under false pretenses and receipt of stolen goods. He was remanded for pretrial intervention. Applicant was ordered to perform community service, which he completed. The record was eventually expunged.	Against Applicant	Fraud or Deception Criminal	Conduct No Charge	Admitted	—	—	—

Descriptive standardized rendering of a decided public case (Guideline J). 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. 16-00126 ) Applicant for Security Clearance )

For Government: Chris Morin, Esquire, Department Counsel For Applicant: Pro se

03/31/2017 ______________

STATEMENT OF CASE

______________

GALES, Robert Robinson, Administrative Judge:

Applicant failed to mitigate the security concerns regarding financial considerations, personal conduct, and criminal conduct. Eligibility for a security clearance and access to classified information is denied.

Statement of the Case

On November 6, 2014, Applicant applied for a security clearance and submitted an Electronic Questionnaire for Investigations Processing (e-QIP) version of a Security Clearance Application.1 On May 16, 2016, the Department of Defense (DOD) Consolidated Adjudications Facility (CAF) issued a Statement of Reasons (SOR) to him, under Executive Order 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended and modified; DOD Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended and modified (Directive); and the Adjudicative Guidelines for Determining Eligibility For Access to Classified Information (December 29, 2005) (AG) applicable to all adjudications and other determinations made under the Directive, effective September 1, 2006. The SOR alleged security concerns under Guidelines F (Financial Considerations), E (Personal Conduct), and J (Criminal Conduct) and detailed reasons why the DOD adjudicators were unable to find that it is clearly consistent with the national interest to grant or continue a security clearance for Applicant. The SOR recommended referral to an administrative judge to determine whether a clearance should be granted, continued, denied, or revoked.

Applicant received the SOR on June 22, 2016. On August 12, 2016, he responded to the SOR and requested a hearing before an administrative judge. Department Counsel indicated the Government was prepared to proceed on September 6, 2016. The case was assigned to me on October 26, 2016. A Notice of Hearing was issued on November 8, 2016. I convened the hearing as scheduled on December 7, 2016.

During the hearing, three Government exhibits (GE) 1 through GE 3, one administrative exhibit, and six Applicant exhibits (AE) A through AE F, were admitted into evidence without objection. Applicant testified. The transcript (Tr.) was received on December 16, 2016. I kept the record open to enable Applicant to supplement it. He took advantage of that opportunity and timely submitted additional documents, which were marked and admitted as AE G through AE N, without objection. The record closed on January 4, 2017.

FINDINGS OF FACT

In his Answer to the SOR, Applicant admitted all of the factual allegations pertaining to financial considerations (¶¶ 1.a. through 1.e.), the factual allegations pertaining to personal conduct (¶¶ 2.b. and 2.c.), and the sole allegation pertaining to criminal conduct (¶ 3.a.) of the SOR. Applicant’s admissions and comments are incorporated herein as findings of fact. After a complete and thorough review of the evidence in the record, and upon due consideration of same, I make the following additional findings of fact:

Applicant was born in Vietnam and immigrated to the United States when he was a few months old. He is a 35-year-old employee of a defense contractor. He has been a desktop support analyst with the company since February 2011. He previously held an identical position with another company from March 2009 until February 2011. He also held a part-time position as a waiter from September 1999 until June 2009. He is a high school graduate. He received a bachelor’s degree in 2005. He has never served in the U.S. military. He has never held a security clearance. Applicant has never been married. He has no children. Financial Considerations2

There was nothing unusual about Applicant’s finances until sometime during the period 2010 through 2014 when a number of unspecified factors apparently contributed to some degree of financial stress. His 2014 credit report indicated that one account was placed for collection in 2010 and another in 2011, and other accounts were placed for collection in 2014. Applicant acknowledged that he was evicted from his apartment, without identifying the timeframe for the activity, and that he did not have sufficient funds “to pay anything at that point.”3

The SOR identified five purportedly delinquent debts that had been placed for collection, as reflected by his December 2014 credit report4 or his May 2016 credit report.5 Those debts, totaling approximately $12,345, and their respective current status, according to the credit reports, other evidence submitted by the Government and Applicant, and Applicant’s comments regarding same, are described below:

SOR ¶ 1.a. refers to an Internet account with an unpaid and past-due balance of $659 that was placed for collection in 2011.6 Applicant claimed that his failure to pay the account was an oversight, and that he was saving money to pay it off.7 Applicant and the collection agent eventually agreed to a reduced amount, and Applicant paid that unspecified amount in January 2017.8 The account has been resolved.

SOR ¶ 1.b. refers to a cellular phone account with an unpaid and past-due balance of $268 that was placed for collection in 2014.9 Applicant claimed that his failure to pay the account was a lapse in judgment caused by his erroneous belief that the account had been set up for autopay when, in fact, it had not. In September 2016 – four months after the SOR was issued – Applicant paid the collection agent $277.80. The account is now considered by that collection agent to have been paid in full.10 The account has been resolved. SOR ¶ 1.c. refers to an automobile insurance account with an unpaid balance of $206 that was placed for collection in 2010.11 Applicant claimed that after he signed for the insurance coverage he found cheaper coverage so he simply did not pay this account. He claimed that the account had been sold by the original creditor and they had no contact information regarding the debt purchaser.12 He said he was saving money to pay off the account, and as of the hearing, he had saved $103.13 Nevertheless, he has taken no further action in an effort to identify or locate the debt purchaser. The account is not listed in Applicant’s 2016 credit report, and it is unclear if the removal was associated with the statute of limitations. The account has not been resolved.

SOR ¶ 1.d. refers to an automobile dealer services account for a 2006 car that Applicant purchased in 2006. Applicant could not recall how long he had made monthly payments before he purportedly voluntarily surrended the vehicle.14 After the repossession, Applicant offered to pay $2,000 to retrieve the vehicle, but the lender wanted the entire unpaid balance.15 Applicant described his relationship with the creditor as follows: “They have been intransigent and will not be flexible with this so that I can pay it off. I am attempting to work with them but we are far apart in coming to terms.”16 After the vehicle was sold at auction, the remaining deficiency was $9,205.17 Applicant acknowledged having received written notification, but he simply “ignored it because [the vehicle] was no longer in [Applicant’s] possession.”18 Applicant has had no contact with the creditor since he received the SOR. The account is not listed in Applicant’s 2016 credit report. The account has not been resolved.

SOR ¶ 1.e. refers to three Stafford subsidized student loans with a combined total of $11,625 that became $434 past due when Applicant stopped making payments in December 2014, leaving an unpaid balance of $2,009.19 Applicant claimed that the student loans went into a “delayed default” status.20 The accuracy of the term is unclear for it appears to be somewhat similar to forbearance or deferment. Applicant explained that he thought he had set up an automatic payment, but it did not occur. In his Answer to the SOR, Applicant said he would call the state lender to sort out everything.21 During the hearing, Applicant contended he had paid the state lender by e-check and the accounts were paid off.22 He offered a document indicating that, as of November 2016, there was a zero balance for the loans,23 but he offered no documentation to support his contention that he had paid the loans as stated. A September 2016 credit report reflects the loans as still past due.24

A December 2016 letter from the state lender clearly states that the three student loans were “paid in full by claim,”25 a term which indicates that the borrower defaulted on a federal student loan that was guaranteed, or insured, by the government, and the lender filed a claim with the government to recover the amount due. That status means the account was paid and closed, but that the government paid off the student loan and not the borrower. It does not mean that the borrower has been released from the student loan. Accordingly, in the absence of documentation supporting Applicant’s contention that he had paid the loans by e-check, I conclude that the student loans have not been resolved.

At the time of the hearing, Applicant had not received any financial counseling.26 However, after the hearing, Applicant indicated that he had signed up for credit counseling and was taking steps to improve his finances by sticking to a strict budget; increasing his payments for debt already in place; and increasing monthly savings.27 Applicant’s current annual salary is $58,979.28 He submitted a Personal Financial Statement reflecting $74,793 in assets, including $1,289 in checking, $800 in savings, and $67,424 in a 401(k) retirement account.29 He also submitted a monthly budget indicating a net monthly income of $2,990.60; monthly expenses of $2,287; and a monthly remainder of $703.60 available for saving or spending.30 Because of the uncertainty of the unspecified factors that apparently contributed to Applicant’s initial financial stress, it remains unclear how his financial environment may have improved over time. Applicant has been steadily employed, without reported periods of unemployment, and he has never revealed the true factors that may have caused his financial issues. Of the five SOR-related debts, since 2014, Applicant clearly resolved only two of the modest ones, totaling $927. He claimed, but not persuasively, that he had resolved his student loans. He has taken no recent actions to resolve two other debts, totaling $9,411. It appears that while Applicant’s financial status may be slightly improved, even in the absence of new delinquent debts, it is difficult to conclude that his financial problems are under control.

Personal Conduct

(SOR ¶¶ 2.b. and 3.a.): In approximately September 2007, when he was about 24 years old, Applicant was fired by an employer after he took a laptop tablet device that belonged to his employer from a storage locker and pawned it. He took the device because he needed the money to pay the rent and repair his vehicle. He received $200 for the device. About one month later, the police called him. He was subsequently charged with obtaining property under false pretenses and receipt of stolen goods. He was remanded for pretrial intervention. Applicant was ordered to perform community service, which he completed. The record was eventually expunged.31

(SOR ¶ 2.c.): In approximately January 2009, Applicant was terminated from employment, or as Applicant stated, his contract was not renewed, after downloading pornography using company assets. He explained that he downloaded the pornography onto a thumb drive to take it home because he did not have Internet and he enjoyed pornography. He did not think anyone would mind what he did.32

(SOR ¶ 2.a.): On November 6, 2014, when Applicant completed his e-QIP, some questions in Section 26 – Financial Record (Delinquency Involving Routine Accounts) asked if, in the past seven years, he had any possessions or property voluntarily or involuntarily repossessed or foreclosed; defaulted on any type of loan; had any bills or debts turned over to a collection agency; had his wages, benefits, or assets garnished or attached for any reason; and been over 120 days delinquent on any debt not previously entered. Applicant answered “no” to all of those questions. He certified that the response was “true, complete, and correct” to the best of his knowledge and belief, but the response to those questions was, in fact, false for Applicant had concealed multiple accounts that came within those parameters, including accounts in collection, defaulted student loans, and repossession of a vehicle.33 He subsequently admitted having accounts that would have required a positive response, but denied that he had deliberately omitted the information or that he knowingly falsified anything to gain an advantage.34 He explained that he had been working on the e-QIP for hours, was almost done, and he was tired, so he did not read the question carefully and failed to proof read his answers. He characterized the omission as an oversight.35 He also added that when he was subsequently interviewed by an investigator from the U.S. Office of Personnel Management (OPM), he was very upfront about “it.”36

Work Performance and Character References

The site manager, software engineering lead, and several coworkers, are all supportive of Applicant’s eligibility for a security clearance. They generally characterize Applicant with terms such as highly professional, trustworthy, respectful of privacy, responsible, knowledgeable, conscientious, and highly ethical. Some also noted that his personal ethics have never been in question, and two references indicated that, to their knowledge, Applicant has never broken any laws.37 Applicant was given two company performance awards for his commitment to excellence in 2013.38

POLICIES

The U.S. Supreme Court has recognized the substantial discretion of the Executive Branch in regulating access to information pertaining to national security emphasizing, “no one has a ‘right’ to a security clearance.”39 As Commander in Chief, the President has the authority to control access to information bearing on national security and to determine whether an individual is sufficiently trustworthy to have access to such information. The President has authorized the Secretary of Defense or his designee to grant an applicant eligibility for access to classified information “only upon a finding that it is clearly consistent with the national interest to do so.”40

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 AG list potentially disqualifying conditions and mitigating conditions, which are used in evaluating an applicant’s eligibility for access to classified information.

An administrative judge need not view the guidelines as inflexible, ironclad rules of law. Instead, acknowledging the complexities of human behavior, these guidelines are applied in conjunction with the factors listed in 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 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 meaningful decision.

In the decision-making process, facts must be established by “substantial evidence.”41 The Government initially has the burden of producing evidence to establish a potentially disqualifying condition under the Directive, and has the burden of establishing controverted facts alleged in the SOR. Once the Government has produced substantial evidence of a disqualifying condition, under Directive ¶ E3.1.15, the applicant has the burden of persuasion to present evidence in refutation, explanation, extenuation or mitigation, sufficient to overcome the doubts raised by the Government’s case. The burden of disproving a mitigating condition never shifts to the Government.42

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 as well. It is because of this special relationship that the Government must be able to repose a high degree of trust and confidence in those 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 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. Furthermore, “security clearance determinations should err, if they must, on the side of denials.”43

Clearance decisions must be “in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.”44 Thus, nothing in this decision should be construed to suggest that I have based this decision, in whole or in part, on any express or implied determination as to Applicant’s allegiance, loyalty, or patriotism. It is merely an indication the Applicant has or has not met the strict guidelines the President and the Secretary of Defense have established for issuing a clearance. In reaching this decision, I have drawn only those conclusions that are reasonable, logical, and based on the evidence contained in the record. Likewise, I have avoided drawing inferences grounded on mere speculation or conjecture.

ANALYSIS

Guideline F, Financial Considerations

The security concern relating to the guideline for Financial Considerations is set out in AG ¶ 18:

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. . . .

The guideline notes several conditions that could raise security concerns. Under AG ¶ 19(a), an “inability or unwillingness to satisfy debts” is potentially disqualifying. Similarly, under AG ¶ 19(c), a “history of not meeting financial obligations” may raise security concerns. Applicant had accounts placed for collection in 2010, 2011, and 2014, and he acknowledged that he was evicted from his apartment, without identifying the timeframe for the activity. The SOR identified five purportedly delinquent debts that had been placed for collection, totaling approximately $12,345. A vehicle was repossessed. AG ¶¶ 19(a) and 19(c) apply.

The guideline also includes examples of conditions that could mitigate security concerns arising from financial difficulties. Under AG ¶ 20(a), the disqualifying condition may be mitigated where “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.” Also, under AG ¶ 20(b), financial security concerns may be mitigated where “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.” Evidence that “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” is potentially mitigating under AG ¶ 20(c). Similarly, AG ¶ 20(d) applies where the evidence shows “the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.”45 AG ¶¶ 20(c) and 20(d) minimally apply. AG ¶¶ 20(a) and 20(b) do not apply. Because of the nature, frequency, and recency of Applicant’s continuing financial difficulties, I am unable to conclude that it occurred “so long ago” or “was so infrequent.” It is unclear what unspecified factors contributed to, or caused, Applicant’s financial problems, or if they were largely beyond Applicant’s control. As noted above, because of the uncertainty of the unspecified factors, it remains difficult to determine if his financial environment has improved over time. Applicant’s apparent inaction in attempting to resolve his delinquent debts over a multi-year period, although he was fully employed, does not support a conclusion that he made timely, repeated efforts to resolve his debts. The evidence supports the conclusion that he finally resolved one 2011 debt for $659 in January 2017, and one 2014 debt for $268 in September 2016. He claims he resolved his student loan balance of $2,009, that was unpaid since 2014, but the documentary evidence supports the conclusion that the government paid the state lender, not Applicant. Two other debts, one for $206 and the other for $9,205, remain unresolved largely due to Applicant’s lack of effort to resolve them – one because the creditor refused to be more flexible in reducing the unpaid balance, and the other because Applicant could not locate the collection agent.

Applicant claims he received financial counseling. With an annual salary of $58,979 and a monthly remainder of $703.60 available for saving or spending, it appears that Applicant should have sufficient means to resolve his remaining debts. However, even in the absence of new delinquent debts, it is difficult to conclude that his financial problems are under control. Applicant’s actions, under the circumstances, cast doubt on his current reliability, trustworthiness, and good judgment.46

Guideline E, Personal Conduct

The security concern relating to the guideline for Personal Conduct is set out in AG ¶ 15:

Conduct involving questionable judgment, lack of candor, dishonesty, or unwillingness to comply with rules and regulations can raise questions about an individual's reliability, trustworthiness and ability 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.

The guideline notes several conditions that could raise security concerns. Under AG ¶ 16(a), it is potentially disqualifying if there is

a deliberate omission, concealment, or falsification of relevant facts from any personnel security questionnaire, personal history statement, or similar form used to conduct investigations, determine employment qualifications, award benefits or status, determine security clearance eligibility or trustworthiness, or award fiduciary responsibilities.

In addition, “deliberately providing false or misleading information concerning relevant facts to an employer, investigator, security official, competent medical authority, or other official government representative” may raise security concerns under AG ¶ 16(b).

It is also potentially disqualifying under AG ¶ 16(c), if there is:

credible adverse information in several adjudicative issue areas that is not sufficient for an adverse determination under any other single guideline, but which, when considered as a whole, supports a whole-person assessment of questionable judgment, untrustworthiness, unreliability, lack of candor, unwillingness to comply with rules and regulations, or other characteristics indicating that the person may not properly safeguard protected information.

In September 2007 Applicant was fired from his employment when he stole and pawned a laptop tablet device, and he was subsequently charged with obtaining property under false pretenses and receipt of stolen goods. He was remanded for pretrial intervention. Applicant was ordered to perform community service, which he completed. The record was eventually expunged. In approximately January 2009, Applicant was terminated from employment after downloading pornography using company assets. He did not think anyone would mind what he did. It is the repeated and improper, and possibly criminal violations that constituted a pattern of dishonesty or rule violations, and evidence of significant misuse of an employer’s resources. AG ¶ 16(c) has been established.

On November 6, 2014, when Applicant completed his e-QIP, he denied that in the past seven years, he had any possessions or property voluntarily or involuntarily repossessed or foreclosed; defaulted on any type of loan; had any bills or debts turned over to a collection agency; had his wages, benefits, or assets garnished or attached for any reason; and been over 120 days delinquent on any debt not previously entered. He certified that the response was “true, complete, and correct” to the best of his knowledge and belief, but the response to those questions was, in fact, false, for Applicant had concealed multiple accounts that came within those parameters, including accounts in collection, defaulted student loans, and repossession of a vehicle. He denied that he had deliberately omitted the information or that he knowingly falsified anything to gain an advantage. He explained that he had been working on the e-QIP for hours, was almost done, and he was tired, so he did not read the question carefully and failed to proof read his answers. He characterized the omission as an oversight. He also added that when he was subsequently interviewed by an OPM investigator he was upfront. His position is unreasonable and not credible. AG ¶ 16(a) has been established.

The guideline also includes examples of conditions that could mitigate security concerns arising from personal conduct. AG ¶ 17(a) may apply if “the individual made prompt, good-faith efforts to correct the omission, concealment, or falsification before being confronted with the facts.” Similarly, AG ¶ 17(c) may apply if “the offense is so minor, or so much time has passed, or the behavior is so infrequent, or it happened under such unique circumstances that it is unlikely to recur and does not cast doubt on the individual’s reliability, trustworthiness, or good judgment.” Also, if “the individual has acknowledged the behavior and obtained counseling to change the behavior or taken other positive steps to alleviate the stressors, circumstances, or factors that caused untrustworthy, unreliable, or other inappropriate behavior, and such behavior is unlikely to recur,” AG ¶ 17(d) may apply.

AG ¶¶ 17(a), 17(c), and 17(d) do not apply. Applicant stole and pawned a laptop tablet device, the property of his employer, in September 2007 – over nine years ago, and two years later he misused another employer’s resources when he downloaded pornography from a company computer in January 2009 – eight years ago. Those actions were not minor, and the circumstances were not unique. Under normal circumstances, if there had been no additional similar issues without any recurrence of similar conduct or behavior, with additional maturity, it would be unlikely that there would be any such recurrence. However, while Applicant’s reliability, trustworthiness, and judgment for such previous actions might no longer be in question, his more recent lack of candor pertaining to his responses on his e-QIP, and the open issues regarding his finances, have reopened the question of his reliability, trustworthiness, and judgment. Other than Applicant’s self- serving comment that he made a prompt, good-faith effort to correct the omission, concealment, or falsification on his e-QIP, there is no evidence to support his contention. Likewise, there is little, if any, evidence to reflect that Applicant has acknowledged his behavior or taken positive steps to alleviate the factors that caused his behavior. Applicant’s actions cast doubt on his reliability, trustworthiness, and good judgment.

Guideline J, Criminal Conduct

The security concern under the guideline for Criminal Conduct is set out in AG ¶ 30: “Criminal activity creates doubt about a person's judgment, reliability, and trustworthiness. By its very nature, it calls into question a person's ability or willingness to comply with laws, rules and regulations.”

The guideline notes a condition that could raise security concerns. Under AG ¶ 31(a), “a single serious crime or multiple lesser offenses” is potentially disqualifying. In approximately September 2007, Applicant took a laptop tablet device that belonged to his employer and pawned it. He was subsequently charged with obtaining property under false pretenses and receipt of stolen goods. He was remanded for pretrial intervention. Applicant was ordered to perform community service, which he completed. The record was eventually expunged. AG ¶ 31(a) has been established.

The guideline also includes examples of conditions that could mitigate security concerns arising from criminal conduct. Under AG ¶ 32(a), the disqualifying condition may be mitigated where “so much time has elapsed since the criminal behavior happened, or it happened under such unusual circumstances that it is unlikely to recur and does not cast doubt on the individual's reliability, trustworthiness, or good judgment.” Similarly, where “there is evidence of successful rehabilitation; including but not limited to the passage of time without recurrence of criminal activity, remorse or restitution, job training or higher education, good employment record, or constructive community involvement,” AG ¶ 32(d) may apply.

AG ¶¶ 32(a) and 32(d) minimally apply. Applicant stole and pawned the property of his employer. He was subsequently charged with obtaining property under false pretenses and receipt of stolen goods. He was remanded for pretrial intervention and ordered to perform community service. He completed his community service and the record was eventually expunged. He followed that criminal conduct with his 2009 misuse of his employer’s computer. There is some evidence of rehabilitation, but it has not lasted. There are some minor expressions of remorse and a good employment record. Because of his repeated misconduct, it appears that he has not learned from his experiences, and it is difficult to conclude that such behavior will not recur. Therefore, his conduct continues to cast doubt on his reliability, trustworthiness, or good judgment.

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 the 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. Moreover, I have evaluated the various aspects of this case in light of the totality of the record evidence and have not merely performed a piecemeal analysis.47

There is some evidence in favor of mitigating Applicant’s conduct. He has established a good reputation with his employer. Applicant finally paid two of his delinquent debts.

The disqualifying evidence under the whole-person concept is more substantial. It is unclear what unspecified factors contributed to, or caused, Applicant’s financial problems, or if they were largely beyond his control. Applicant’s apparent inaction in attempting to resolve his delinquent debts over a multi-year period, although he was fully employed, does not support a conclusion that he made timely, repeated efforts to resolve his debts. 48 The evidence supports the conclusion that he finally resolved one 2011 debt for $659 in January 2017, and one 2014 debt for $268 in September 2016. He claims he resolved his student loan balance of $2,009, that was unpaid since 2014, but the documentary evidence supports the conclusion that the government paid the state lender, not Applicant. Two other debts, one for $206 and the other for $9,205, remain unresolved largely due to Applicant’s lack of effort to resolve them – one because the creditor refused to be more flexible in reducing the unpaid balance, and the other because Applicant could not locate the collection agent. It remains unclear how his financial environment may have improved over time. Applicant has been steadily employed, without reported periods of unemployment, and he has never revealed the true factors that may have caused his financial issues.

The Appeal Board has addressed a key element in the whole-person analysis in financial cases stating:

In evaluating Guideline F cases, the Board has previously noted that the concept of “‘meaningful track record’ necessarily includes evidence of actual debt reduction through payment of debts.” However, an applicant is not required, as a matter of law, to establish that he [or she] has paid off each and every debt listed in the SOR. All that is required is that an applicant demonstrate that he [or she] has “. . . established a plan to resolve his [or her] financial problems and taken significant actions to implement that plan.” The Judge can reasonably consider the entirety of an applicant’s financial situation and his [or her] actions in evaluating the extent to which that applicant’s plan for the reduction of his outstanding indebtedness is credible and realistic. See Directive ¶ E2.2(a) (“Available, reliable information about the person, past and present, favorable and unfavorable, should be considered in reaching a determination.”) There is no requirement that a plan provide for payments on all outstanding debts simultaneously. Rather, a reasonable plan (and concomitant conduct) may provide for the payment of such debts one at a time. Likewise, there is no requirement that the first debts actually paid in furtherance of a reasonable debt plan be the ones listed in the SOR. 49

Applicant has not demonstrated a “meaningful track record” of debt reduction and elimination efforts. While he now keeps track of his expenses and maintains a budget, there is little evidence that he did so before the hearing. His inaction with respect to the majority of his delinquent debts over a multi-year period, and his refusal to address his largest debt because the creditor is not flexible or willing to reduce the unpaid balance are symptoms of an unwillingness to take timely positive action in resolving his debts. Overall, the evidence leaves me with questions and doubts as to Applicant’s security worthiness. For all of these reasons, as well as his lack of candor regarding his delinquent debts, I conclude Applicant has failed to mitigate the security concerns arising from his financial considerations, personal conduct, and criminal conduct. See AG ¶ 2(a)(1) through AG ¶ 2(a)(9).

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, Guideline F: AGAINST APPLICANT

Subparagraphs 1.a. and 1.b.: For Applicant Subparagraphs 1.c. through 1.e.: Against Applicant

Paragraph 2, Guideline E: AGAINST APPLICANT

Subparagraphs 2.a. through 2.c.: Against Applicant

Paragraph 3, Guideline J: AGAINST APPLICANT

Subparagraph 3.a.: 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 eligibility for a security clearance. Eligibility for access to classified information is denied.

________________________ ROBERT ROBINSON GALES Administrative Judge

FOOTNOTES

1 GE 1 (e-QIP, dated November 6, 2014). 2 General source information pertaining to the financial accounts discussed below can be found in the following exhibits: GE 2 (Combined Experian, TransUnion, and Equifax Credit Report, dated December 10, 2014); GE 3 (Equifax Credit Report, dated May 2, 2016); Applicant’s Answer to the SOR, dated August 12, 2016. More recent information can be found in the exhibits furnished and individually identified. 3 GE 2, supra note 2; Tr. at 22-23. 4 GE 2, supra note 2. 5 GE 3, supra note 2. 6 GE 2, supra note 2, at 5; Tr. at 23. 7 Tr. at 23, 29-30. 8 AE H (Letter, dated January 3, 2017). 9 GE 2, supra note 2, at 6; GE 3, supra note 2, at 1; Tr. at 23. 10 AE I (Letter, dated December 28, 2016); AE F (Changed Accounts, dated December 2, 2016), at 2. 11 GE 2, supra note 2, at 6; Tr. at 24. 12 Tr. at 25-26. 13 Tr. at 32. 14 Tr. at 26-27. 15 Tr. at 33. 16 Applicant’s Answer to the SOR, supra note 2. 17 GE 2, supra note 2, at 8. 18 Tr. at 34. 19 GE 3, supra note 2, at 2-3; AE J (Letter and Report, dated December 28, 2016). 20 Tr. at 35. 21 Applicant’s Answer to the SOR, supra note 2. 22 Tr. at 27-28, 35. It should be noted that the SOR alleged, in part, in ¶ 2.a., that Applicant’s wages were garnished for non-payment of his student loans in 2014, an allegation that Applicant denied. Neither the Government nor Applicant discussed that portion of the allegation, and there I found no evidence of a garnishment. 23 AE F, supra note 10, at 1. 24 AE E (Credit Report, dated September 29, 2016), at 1. 25 AE J, supra note 19. 26 Tr. at 42. 27 AE G (Letter, undated). 28 AE M (Paycheck Print, dated January 4, 2017). 29 AE K (Personal Financial Statement, dated December 10, 2016). 30 AE L (Budget, undated). 31 Tr. at 52-56, 58-61; Applicant’s Answer to the SOR, supra note 2. 32 Tr. at 56-58; Applicant’s Answer to the SOR, supra note 2. 33 As I noted above, I found no evidence of a 2014 garnishment of wages associated with defaulted student loans. 34 Applicant’s Answer to the SOR, supra note 2; Tr. at 50. 35 Tr. at 50-51. 36 Tr. at 50. 37 AE A (Character Reference, dated December 7, 2016); AE B (Character Reference, undated); AE C (Character Reference, undated); AE D (Character Reference, dated December 5, 2016). 38 AE N (Certificates, undated). 39 Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). 40 Exec. Or. 10865, Safeguarding Classified Information within Industry § 2 (Feb. 20, 1960), as amended and modified. 41 “Substantial evidence [is] such relevant evidence as a reasonable mind might accept as adequate to support a conclusion in light of all contrary evidence in the record.” ISCR Case No. 04-11463 at 2 (App. Bd. Aug. 4, 2006) (citing Directive ¶ E3.1.32.1). “Substantial evidence” is “more than a scintilla but less than a preponderance.” See v. Washington Metro. Area Transit Auth., 36 F.3d 375, 380 (4th Cir. 1994). 42 See ISCR Case No. 02-31154 at 5 (App. Bd. Sep. 22, 2005). 43 Egan, 484 U.S. at 531. 44 See Exec. Or. 10865 § 7. 45 The Appeal Board has previously explained what constitutes a good-faith effort to repay overdue creditors or otherwise resolve debts: In order to qualify for application of [the “good-faith” mitigating condition], an applicant must present evidence showing either a good-faith effort to repay overdue creditors or some other good-faith action aimed at resolving the applicant’s debts. The Directive does not define the term “good-faith.” However, the Board has indicated that the concept of good-faith “requires a showing that a person acts in a way that shows reasonableness, prudence, honesty, and adherence to duty or obligation.” Accordingly, an applicant must do more than merely show that he or she relied on a legally available option (such as bankruptcy [or statute of limitations]) in order to claim the benefit of [the “good-faith” mitigating condition]. (internal citation and footnote omitted) ISCR Case No. 02-30304 at 3 (App. Bd. Apr. 20, 2004) (quoting ISCR Case No. 99-9020 at 5-6 (App. Bd. June 4, 2001)). 46 See ISCR Case No. 09-08533 at 3-4 (App. Bd. Oct. 6, 2010). 47 See U.S. v. Bottone, 365 F.2d 389, 392 (2d Cir. 1966); See also ISCR Case No. 03-22861 at 2-3 (App. Bd. Jun. 2, 2006). 48 The Appeal Board has indicated that promises to pay off delinquent debts in the future are not a substitute for a track record of paying debts in a timely manner and otherwise acting in a financially responsible manner. ISCR Case No. 07-13041 at 4 (App. Bd. Sept. 19, 2008) (citing ISCR Case No. 99-0012 at 3 (App. Bd. Dec. 1, 1999)). 49 ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008) (internal citations omitted).