CASE · Clearance Adjudication Search EngineCASE

Loading case…

ISCR Case 16-01204.h1 — CASE

ISCR Case 16-01204.h1granted

Case Headnote

ISCR Case No. 16-01204.h1

grantedSep 19, 2017· Hon. Robert J. Kilmartin· hearing

Summary

A 51-year-old administrative assistant was granted a security clearance despite initial concerns under Guideline F (Financial Considerations). The applicant had filed for Chapter 7 bankruptcy in August 2012, discharging $50,000 in consumer debts by January 2013. Additionally, she admitted to eight of eleven alleged delinquent debts.

To address these issues, the applicant established and adhered to a Debt Management Plan, making monthly payments of $245 since November 2016. She provided documentary evidence of payments and mitigation efforts for the outstanding debts, including one that was recently paid off. The judge noted that her financial difficulties were largely due to circumstances beyond her control, such as divorce and unemployment.

The judge determined that the applicant demonstrated a good-faith effort to resolve her financial issues and successfully mitigated the security concerns. Consequently, her eligibility for a security clearance was granted.

Why the Applicant Prevailed

The applicant established a Debt Management Plan and adhered to it, demonstrating a commitment to resolving her debts.
She provided evidence of payments made towards several delinquent debts, showing progress in her financial situation.
The financial difficulties were largely due to circumstances beyond her control, including divorce and unemployment.

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)raisedA History of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(a)appliedBehavior Happened so Long Ago or Occurred Under Circumstances Unlikely to Recur
AG ¶ 20(b)appliedConditions Resulting in Financial Problems Were Largely Beyond the Person's Control
AG ¶ 20(d)appliedIndividual Initiated and Is Adhering to a Good-faith Effort to Repay Overdue Creditors

Key Rule Quoted

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

Procedural Posture

SOR issuedJul 13, 2016
Answer filedDec 10, 2016Applicant elected to have her case decided on the written record.
Hearing held—Case assigned on August 8, 2017.
Decision dateSep 19, 2017

Cite For

Mitigation of Financial Issues Under Guideline F
Good-faith Efforts in Debt Repayment
Impact of Personal Circumstances on Financial Stability

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 mitigated the financial concerns under Guideline F, which included a Chapter 7 bankruptcy filing and multiple delinquent debts. The applicant demonstrated a good-faith effort to repay her debts and provided evidence of a Debt Management Plan, leading to a decision to grant her eligibility for a security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant admitted to filing for Chapter 7 Bankruptcy protection in August 2012, and $50,000 of consumer debts were discharged in January 2013.	For Applicant	Bankruptcy Filing	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.b	Applicant admitted to 8 of the 11 allegations of delinquent debts in the SOR.	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.c–1.d	2 sub-charges — specific text not stated in this decision (for the applicant). (low confidence)	For Applicant			—	—	—
1.e	Applicant provided evidence showing that she has made payments, and has automatic debits taken from her account, in the amount of $245 per month, since November 2016.	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.f	Applicant provided documentary evidence attached to her response to the FORM, to show progress on payments, or mitigation regarding the other eight delinquent debts alleged in the SOR.	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.g	Applicant provided documentary evidence attached to her response to the FORM, to show progress on payments, or mitigation regarding the other eight delinquent debts alleged in the SOR.	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.h	specific text not stated in this decision	For Applicant	Unspecified Financial	Denied	—	—	—
1.i	Applicant denied SOR ¶ 1.i as it was paid off recently. (low confidence)	For Applicant	Unspecified Financial	Denied	—	—	—
1.j–1.l	3 sub-charges — specific text not stated in this decision (for the applicant). (low confidence)	For Applicant			—	—	—

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. 16-01204 ) Applicant for Security Clearance )

For Government: Andre Gregorian, Esq., Department Counsel For Applicant: Pro se 09/19/2017 ______________

STATEMENT OF CASE

______________

KILMARTIN, Robert J., Administrative Judge:

Applicant mitigated the security concerns under Guideline F, financial considerations. Applicant’s eligibility for a security clearance is granted.

Statement of the Case

On July 13, 2016, the Department of Defense (DOD) issued Applicant a Statement of Reasons (SOR) detailing security concerns under Guideline F, financial considerations. The action was taken under Executive Order (EO)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 (AGs) effective within the DOD for SORs issued after September 1, 2006.

On December 10, 2016, Director of National Intelligence issued Security Executive Agent Directive (SEAD) 4, which revised and replaced the 2006. The new AGs became effective for all decisions issued on or after June 8, 2017. Accordingly, I have applied the newly revised AGs to this decision.1

Applicant timely answered the SOR, and elected to have her case decided on the written record. Department Counsel submitted the Government’s file of relevant material (FORM) on September 23, 2016. Applicant received the FORM on October 5, 2016, and had 30 days to file objections and submit material in refutation, extenuation, or mitigation. Applicant did not object to the Government’s evidence and provided a two- page response to the FORM on November 16, 2016. Attached to her response was a Debt Management Plan. Also attached were receipts and confirmations showing that SOR ¶¶ 1.e, 1.f, 1.g, and 1.i were paid in full. The Government’s exhibits (GE) 1 through 8 were admitted into evidence without objection. The case was assigned to me on August 8, 2017.

Findings of Fact2

Applicant admitted to the Chapter 7 bankruptcy filing and 8 of the 11 allegations of delinquent debts in the SOR. She denied SOR ¶¶ 1.cand 1.has they are duplicate debts already charged in SOR ¶¶ 1.band 1.g; and she denied SOR ¶ 1.i as it was paid off recently.3 The alleged delinquent debts total more than $8,000. She also provided a two-page response to the FORM and provided supporting information marked as Applicant’s Exhibit (AE) A consisting of six pages of receipts and e-mail confirmations that she paid off SOR ¶¶ 1.e, 1.f, 1.g, and the debt above at SOR ¶ 1.i. In addition, attached to her response were 18 pages of a Debt Management Plan (DMP) setting forth specific terms of re-payment of her remaining delinquent debts at SOR ¶¶ 1.b, 1.d, 1.e, 1.j, 1.k, and 1.l. This is marked as AE B. The Green Path DMP included an electronic transfer of funds authorization signed by Applicant allowing her account to be debited twice a month for payments of $122.50. This $245 each month was sent to the DMP to execute her plan and pay off the remaining debts. After a thorough and careful review of the pleadings and exhibits submitted, I make the following additional findings of fact. . Applicant is 51 years old. She obtained her bachelor’s degree in 2009. She was married in 1988 and divorced in 2006. She has been employed as an administrative assistant by a federal contractor since April 2015. She reported in her 2015 Questionnaire for National Security Positions, also known as her security clearance application (SCA) that she was fired in January 2015 by her employer, which was undergoing a reorganization. Then, she was unemployed for four months until she started her present job. She supported herself using savings and student loans during her period of unemployment.

Applicant disclosed her delinquent debts in section 26 of her February 2015 SCA. These debts resulted from a trip to the emergency room (medical debts) when she had no health insurance coverage, delinquent student loans, and general credit card debt. She has produced evidence showing that she has made payments, and has automatic debits taken from her account, in the amount of $245 per month, since November 2016.4 That is when she consolidated her delinquent debts for re-payment and entered into an income-driven repayment plan with the DMP. Applicant ascribes her divorce, unemployment and mismanagement as the reasons for her financial problems in her clearance interview.5 In the same subject interview, she stated her intention to enter into a debt consolidation and repayment plan within six months.6 She has now established a payment plan and followed through on her statement to the clearance interview investigator.

Applicant also disclosed that she filed for Chapter 7 Bankruptcy protection in August 2012, and $50,000 of consumer debts were discharged in January 2013. It was necessary for her to file for bankruptcy protection because after their divorce, her ex- husband filed his own petition for Chapter 13 bankruptcy protection. Then, the creditors started coming after Applicant on their joint debts. She had only been employed sporadically and part time in most cases. She couldn’t keep up with her financial responsibilities. Applicant reports having no previous security clearance.

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 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, 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. 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 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. Likewise, I have avoided drawing inferences grounded on mere speculation or conjecture. Under Directive ¶ E3.1.14, the Government must 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 applicant or proven by Department Counsel, and has the ultimate burden of persuasion as to obtaining a favorable security decision.”

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. 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 that an 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.

Section 7 of Executive Order 10865 provides that 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 risk of having to engage in illegal acts to generate funds. . . .

This concern is broader than the possibility that an individual might knowingly compromise classified information in order to raise money. It encompasses concerns about an individual’s self-control, judgment, and other qualities essential to protecting classified information. An individual who is financially irresponsible may also be irresponsible, unconcerned, or negligent in handing and safeguarding classified information. AG ¶ 19 provides conditions that could raise security concerns. The following apply here:

(a) inability to satisfy debts;

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

Applicant admitted to filing for bankruptcy protection and to 8 of the 11 delinquent debts alleged in the SOR. There is sufficient evidence to support the application of the above disqualifying conditions.

The guideline also includes conditions that could mitigate security concerns arising from financial difficulties. The following mitigating conditions under AG ¶ 20 are potentially applicable:

(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 problems 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; and

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

Applicant endured divorce, unemployment, and an un-covered medical emergency. These conditions were beyond her control. She has acted responsibly to address these adverse circumstances. She disclosed her delinquent debts in her SCA, and she has since contacted her creditors to make payment arrangements and expressed her intent to pay all debts in full. She has a DMP and she is adhering to it. Applicant has produced evidence that she has followed through on this plan. She admitted to the Chapter 7 filing in SOR ¶ 1.a. She provided documentary evidence attached to her response to the FORM, to show progress on payments, or mitigation regarding the other eight delinquent debts alleged in the SOR. AG ¶¶ 20(a), 20 (b) and 20(d) apply. I am satisfied that her delinquent debts have been or are being resolved.

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(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 F in my whole-person analysis. Some of the factors in AG ¶ 2(d) were addressed under those guidelines, but some warrant additional comment.

Applicant’s finances are no longer a security concern. There are ample indications that Applicant’s financial problems are under control. She has met her burden of persuasion. For all these reasons, I conclude Applicant has mitigated the security concerns arising under Guideline F, financial considerations.

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: FOR APPLICANT

Subparagraphs 1.a -1.l: 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’s eligibility for a security clearance. Eligibility for access to classified information is granted.

_____________________________ Robert J. Kilmartin Administrative Judge

FOOTNOTES

1 Although I have applied the new AGs that became effective on June 8, 2017, to this decision, I have also considered the case under the previous AGs and my decision would be no different under either version. 2 Unless stated otherwise, the source of the information in this section is Applicant’s May 8, 2015 Security Clearance Application (SCA) (GE 2); and her summary of clearance interview of January 22, 2016. 3 Item 1, Answer to SOR, and AE A. 4 AE B. 5 Item 3, Summary of Subject Interview. 6 Item 3.