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ISCR Case 16-01062.h1 — CASE

ISCR Case 16-01062.h1granted

Case Headnote

ISCR Case No. 16-01062.h1

grantedOct 2, 2017· Hon. Richard A. Cefola· hearing

Summary

This security clearance decision involved a 53-year-old defense contractor employee whose eligibility was initially questioned under Guideline F, Financial Considerations. The Statement of Reasons cited three specific financial allegations: an outstanding judgment from 2009 for approximately $8,533, a past-due debt of $122 to a wireless firm, and a past-due credit card debt of $8,737. These issues raised concerns under Disqualifying Conditions AG ¶ 19(a), AG ¶ 19(b), and AG ¶ 19(c).

However, the applicant successfully demonstrated that all alleged debts had been resolved. The 2009 judgment was satisfied in February 2011, and no longer appeared on his November 2016 credit report. Both the wireless firm debt and the credit card debt were also paid, with documentation from the creditors and the November 2016 credit report confirming their resolution.

The decision to grant the clearance was based on the application of Mitigating Conditions AG ¶ 20(a) and AG ¶ 20(d). The applicant proved that all debts were satisfied before the hearing, exhibited a good-faith effort to resolve past financial issues, and established a stable and responsible current financial situation. Consequently, the security clearance was GRANTED.

Why the Applicant Prevailed

All alleged debts were satisfied prior to the hearing.
The applicant's current financial situation is stable and responsible.
The applicant demonstrated a good-faith effort to resolve past debts.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability to Satisfy Debts
AG ¶ 19(b)raisedUnwillingness to Satisfy Debts
AG ¶ 19(c)raisedHistory of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(a)appliedBehavior Occurred Long Ago or Infrequently
AG ¶ 20(d)appliedGood-faith Effort to Repay Debts

Key Rule Quoted

“The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision.”

Procedural Posture

SOR issuedJun 27, 2016
Answer filedJul 17, 2016
Hearing heldNov 22, 2016
Decision dateOct 2, 2017

Cite For

Mitigation of Financial Issues Under Guideline F
Satisfaction of Debts as a Factor in Security Clearance Decisions
Whole-person Concept in Evaluating 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: granted

The judge found that the applicant had previously satisfied a judgment and paid off two past-due debts, mitigating the financial concerns raised under Guideline F. As a result, the judge ruled in favor of the applicant on all allegations related to financial considerations.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	It is alleged that Applicant had a 2009 outstanding judgment against him in the amount of about $8,533. This judgment was satisfied in February of 2011; and as such, no such public record appears on Applicant’s November 2016 credit report (CR). $8,533	For Applicant	Judgment Against Applicant	Admitted	—	(a) behavior happened long ago / infrequent / unlikely to recur (d) good-faith effort to repay or otherwise resolve debts	—
1.b	It is alleged that Applicant had a past-due debt to a wireless firm in the amount of $122. Applicant has paid this debt, as evidenced by documentation from the creditor. $122	For Applicant	Utility or Phone Debt	Admitted	—	(a) behavior happened long ago / infrequent / unlikely to recur (d) good-faith effort to repay or otherwise resolve debts	—
1.c	It is alleged that Applicant had a past-due credit card debt in the amount of $8,737. Applicant has paid this debt, as evidenced by documentation from the creditor, and Applicant’s November 2016 CR. $8,737	For Applicant	Credit Card Debt	Admitted	—	(a) behavior happened long ago / infrequent / unlikely to recur (d) good-faith effort to repay or otherwise resolve debts	—

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. 16-01062 ) ) Applicant for Security Clearance )

For Government: Andrew Henderson, Esq., Department Counsel For Applicant: Pro se

October 2, 2017 ______________

STATEMENT OF CASE

______________

CEFOLA, Richard A., Administrative Judge:

Statement of the Case

On June 27, 2016, in accordance with DoD Directive 5220.6, as amended (Directive), the Department of Defense issued Applicant a Statement of Reasons (SOR) alleging facts that raise security concerns under Guideline F.1 The SOR further informed Applicant that, based on information available to the government, DoD adjudicators could not make the preliminary affirmative finding it is clearly consistent with the national interest to grant or continue Applicant’s security clearance.

Applicant answered the SOR on July 17, 2016, and requested a hearing before an administrative judge. (Answer.) The case was assigned to me on October 27, 2016. The Defense Office of Hearings and Appeals (DOHA) issued a notice of hearing on October 27, 2016, scheduling the hearing for November 22, 2016. The hearing was convened as scheduled. The Government offered Exhibits (GXs) 1 through 4, which were admitted without objection. Applicant testified on his own behalf. Pursuant to Applicant’s repeated requests, the record was left open until February 6, 2017, for the receipt of additional documentation. After his hearing on November 22, 2016, and again on February 2, 2017, Applicant presented two packets of documents, which I marked Applicant’s Exhibits (AppXs) A and B, respectively, and admitted without objection. DOHA received the transcript of the hearing (TR) on November 30, 2016.

FINDINGS OF FACT

Applicant admitted all the allegations in SOR. After a thorough and careful review of the pleadings, exhibits, and testimony, I make the following findings of fact.

Applicant is a 53-year-old employee of a defense contractor. (GX 1 at pages 5 and 15.) He has been employed with the defense contractor since March of 2015. (GX 1 at page 15.) He has held a security clearance off and on since about November of 2010. (GX 1 at pages 15–20 and 40). Applicant has had logistical problems in dealing with his debts from his work location in the Republic of Korea, as evidenced by his testimony. (TR at page 17 line 1 to page 23 line 17.)

Guideline F – Financial Considerations

1.a. It is alleged that Applicant had a 2009 outstanding judgment against him in the amount of about $8,533. This judgment was satisfied in February of 2011; and as such, no such public record appears on Applicant’s November 2016 credit report (CR). (TR at page 17 line 1 to page 19 line 25, and AppXs A at page 1 and B at page 3.) I find that this judgment has been satisfied.

1.b. It is alleged that Applicant had a past-due debt to a wireless firm in the amount of $122. Applicant has paid this debt, as evidenced by documentation from the creditor. (AppX B at page 1.) I find that this debt has been satisfied.

1.c. It is alleged that Applicant had a past-due credit card debt in the amount of $8,737. Applicant has paid this debt, as evidenced by documentation from the creditor, and Applicant’s November 2016 CR. (TR at page 20 line 20 to page 23 line 17, and AppXs A at page 2 and B at page 1.) I find that this debt has been satisfied.

POLICIES

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

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 AG ¶ 2 describing the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. According to AG ¶ 2(a), 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 national security eligibility 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 contained in the record.

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, and has the ultimate burden of persuasion as to obtaining a favorable clearance decision.”

A person who applies for access to classified information 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 access to classified information. 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 information.

Section 7 of Executive Order (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

Guideline F - Financial Considerations

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

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. Affluence that cannot be explained by known sources of income is also a security concern insofar as it may result from criminal activity, including espionage.

The guideline notes several conditions that could raise security concerns under AG ¶ 19. Three are potentially applicable in this case:

(a) inability to satisfy debts;

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

Applicant had an outstanding judgment, and two other past-due debts, totaling about $17,400. The evidence is sufficient to raise these disqualifying conditions.

AG ¶ 20 provides conditions that could mitigate security concerns. I considered all of the mitigating conditions under AG ¶ 20 including:

(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; and

(d) the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts.

Applicant has satisfied the judgment and paid the other two debts. His current financial situation is stable. Mitigation under AG ¶ ¶ 20(a) and 20(d) have been established.

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.

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.

I considered the potentially disqualifying and mitigating conditions in light of all the facts and circumstances surrounding this case. I have incorporated my comments under Guideline F in my whole-person analysis. Overall, the record evidence leaves me without questions or doubts as to Applicant’s eligibility and suitability for a security clearance. For these reasons, I conclude Applicant mitigated the Financial Considerations security concerns.

FORMAL FINDINGS

Formal findings for or against Applicant on the allegations set forth in the SOR, as required by ¶ E3.1.25 of the Directive, are:

Paragraph 1, Guideline F: FOR APPLICANT

Subparagraph 1.a: For Applicant Subparagraph 1.b: For Applicant Subparagraph 1.c: For Applicant

CONCLUSION

In light of all of the circumstances presented by the record in this case, it is clearly consistent with the national interest to grant Applicant national security eligibility and a security clearance. Eligibility for access to classified information is granted.

________________________ Richard A. Cefola Administrative Judge

FOOTNOTES

1 I considered the previous Adjudicative Guidelines, effective September 1, 2006, as well as the new Adjudicative Guidelines, effective June 8, 2017. My decision would be the same if the case was considered under the previous Adjudicative Guidelines, effective September 1, 2006.