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ISCR Case 08-02117.h1 — CASE

ISCR Case 08-02117.h1denied

Case Headnote

ISCR Case No. 08-02117.h1

deniedSep 29, 2008· Hon. Joseph Testan· hearing

Summary

A 42-year-old defense contractor employee was denied a security clearance under Guideline F, Financial Considerations, due to significant delinquent debts totaling approximately $18,900. The Statement of Reasons detailed four specific debts: a Bank of America credit card debt of approximately $6,194 charged off in 2005, a DSRM National Bank debt of approximately $267 placed for collection in 2005, a Citi account debt of approximately $2,293 charged off in 2005, and a Bank of America vehicle loan deficiency of approximately $10,158 charged off in 2006 after a vehicle repossession.

Disqualifying conditions 19.a and 19.c were raised, while mitigating conditions 20.a, 20.b, 20.c, and 20.d were applied.

Despite the applicant attributing the financial difficulties to family circumstances, the denial was based on a history of not meeting financial obligations, the likelihood that these difficulties would continue, and insufficient evidence of responsible actions or resolution efforts regarding the debts. The clearance was ultimately denied.

Why the Applicant Was Denied

Applicant has a history of not meeting financial obligations.
Applicant's financial difficulties are likely to continue, leaving him unable to address his debts.
Insufficient evidence was presented to demonstrate responsible actions regarding financial issues.

Conditions Referenced

Disqualifying

19.aappliedInability or Unwillingness to Satisfy Debts
19.cappliedA History of Not Meeting Financial Obligations

Mitigating

20.arejectedBehavior Happened Long Ago or InfrequentlyApplicant's numerous delinquent debts are still outstanding.
20.brejectedConditions Largely Beyond the Person's ControlInsufficient evidence to establish that financial problems would not exist without family issues.
20.crejectedReceived Counseling for the Problem
20.drejectedGood-faith Effort to Repay Debts

Key Rule Quoted

“Any doubt as to whether access to classified information is clearly consistent with national security will be resolved in favor of the national security.”
— Directive, Paragraph E2.2.2.

Procedural Posture

SOR issuedMay 21, 2008
Answer filedMay 28, 2008
Hearing held—Applicant appeared Pro Se.
Decision dateSep 29, 2008

Cite For

Financial Considerations Under Guideline F
Impact of Unresolved Debts on Security Clearance Eligibility
Insufficient Evidence of Responsible Financial Behavior as a Basis for Mitigation

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

Standardized Decision Profile

SEAD-4 Guideline F · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The applicant has multiple outstanding debts totaling approximately $18,900, including credit card debts and a deficiency from a repossessed vehicle. The judge found that the applicant's financial difficulties were not sufficiently mitigated, leading to a decision against the applicant under Guideline F.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant is indebted to Bank of America in the approximate amount of $6,194.00. This credit card debt was charged off in 2005. $6,194	Against Applicant	Credit Card Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Applicant is indebted to DSRM National Bank in the approximate amount of $267.00. This debt was placed for collection in 2005. $267	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	Applicant is indebted to Citi in the approximate amount of $2,293.00. This account was charged off in 2005. $2,293	Against Applicant	Credit Card Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	Applicant is indebted to Bank of America in the approximate amount of $10,158.00. This debt represents the difference between what the creditor received after it sold applicant’s repossessed vehicle at auction and what applicant still owed on the vehicle loan. This debt was charged off in 2006. $10,158	Against Applicant	Auto Loan Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—

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

Full decision

The complete, official text — footnotes and signatures included — is in the original PDF.

Decision text, by section

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

APPEARANCES

DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS

In the matter of: ) ) ---------------------- ) ISCR Case No. 08-02117 SSN: ----------- ) ) Applicant for Security Clearance )

For Government: Paul M. DeLaney, Department Counsel For Applicant: Pro Se

September 29, 2008

______________

STATEMENT OF CASE

______________

TESTAN, Joseph, Administrative Judge:

On May 21, 2008, the Defense Office of Hearings and Appeals (DOHA) issued a Statement of Reasons (SOR) to applicant detailing the security concerns under Guideline F. The action was taken under Executive Order 10865, Safeguarding Classified Information Within Industry (February 20, 1960), as amended; Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the revised adjudicative guidelines (AG) promulgated by the President on December 29, 2005, and effective within the Department of Defense for SORs issued after September 1, 2006.

Applicant answered the SOR in writing on May 28, 2008, and requested an Administrative Determination by an Administrative Judge (AJ). Department Counsel issued a File of Relevant Material (FORM) on June 26, 2008. Applicant did not file a response to the FORM. The case was assigned to me on September 15, 2008. Based upon a review of the case file, pleadings, and exhibits, eligibility for access to classified information is denied.

FINDINGS OF FACT

Applicant is a 42 year old employee of a defense contractor.

Applicant is indebted to Bank of America in the approximate amount of $6,194.00. This credit card debt was charged off in 2005.

Applicant is indebted to DSRM National Bank in the approximate amount of $267.00. This debt was placed for collection in 2005.

Applicant is indebted to Citi in the approximate amount of $2,293.00. This account was charged off in 2005.

Applicant is indebted to Bank of America in the approximate amount of $10,158.00. This debt represents the difference between what the creditor received after it sold applicant’s repossessed vehicle at auction and what applicant still owed on the vehicle loan. This debt was charged off in 2006.

In response to the SOR, applicant stated that his inability to satisfy these debts is the result of deaths in his family, which resulted in, among other things, he and his wife assuming guardianship of his wife’s handicapped sister. He further stated that, although he is not in the position to address these debts at this time, he “hope[s] to one day pay these debts in full.”

POLICIES

The President has “the authority to . . . control access to information bearing on national security and to determine whether an individual is sufficiently trustworthy to occupy a position that will give that person access to such information.” (Department of the Navy v. Egan, 484 U.S. 518,527 (1988).) In Executive Order 10865, Safeguarding Classified Information Within Industry (February 20, 1960), the President set out guidelines and procedures for safeguarding classified information within the executive branch. The President authorized the Secretary of Defense or his designee to grant applicants eligibility for access to classified information “only upon a finding that it is clearly consistent with the national interest to do so.” (Exec. Ord. 10865, Section 2.)

To be eligible for a security clearance, an applicant must meet the security guidelines contained in the Directive. Enclosure 2 of the Directive sets forth personnel security guidelines, as well as the disqualifying conditions and mitigating conditions under each guideline.

Initially, the Government must present evidence to establish controverted facts in the SOR that disqualify or may disqualify the applicant from being eligible for access to classified information. (Directive, Paragraph E3.1.14.) Thereafter, the applicant is responsible for presenting evidence to rebut, explain, extenuate, or mitigate the facts. (Directive, Paragraph E3. 1.15.) An applicant “has the ultimate burden of demonstrating that it is clearly consistent with the national interest to grant or continue his security clearance.” (ISCR Case No. 01-20700 at 3 (App. Bd. Dec. 19, 2002).) “Any doubt as to whether access to classified information is clearly consistent with national security will be resolved in favor of the national security.” (Directive, Paragraph E2.2.2.)

A person granted access to classified information enters into a special relationship with the government. 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. The decision to deny an individual a security clearance is not a determination as to the loyalty of the applicant. (Exec. Ord. 10865, Section 7.) It is merely an indication that the applicant has not met the strict guidelines the President has established for issuing a clearance.

ANALYSIS

Guideline F, Financial Considerations

The security concern relating to Financial Considerations is set forth in Paragraph 18 of the new AG, and is as follows:

Failure or inability to live within one*smeans, 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*sreliability, 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 AG note several conditions that could raise security concerns. Under Paragraph 19.a., an “inability or unwillingness to satisfy debts” is potentially disqualifying. Under Paragraph 19.c., “a history of not meeting financial obligations” may raise security concerns. The evidence shows applicant has a history of being unable to pay his debts. Accordingly, these disqualifying conditions are applicable.

The guidelines also set out mitigating conditions. Paragraph 20.a. may apply 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*scurrent reliability, trustworthiness, or good judgment.” Applicant’s numerous delinquent debts are still outstanding. This mitigation condition is not applicable.

Under Paragraph 20.b., it may be mitigating where “the conditions that resulted in the financial problem were largely beyond the person*scontrol (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.” Although applicant’s financial problems appear to be at least partially the result of family issues beyond his control, he presented insufficient evidence to establish that he would not be experiencing these problems without these family issues, or that he acted responsibly under the circumstances. Accordingly, this mitigating condition is not applicable. 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 Paragraph 20.c. This mitigation condition does not apply.

Paragraph 20.d. applies where the evidence shows “the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.” This mitigating condition does not apply.

“Whole Person” Analysis

Under the whole person concept, the AJ must evaluate an applicant’s security eligibility by considering the totality of the applicant’s conduct and all the circumstances. An AJ should consider the nine adjudicative process factors listed at AG Paragraph 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) 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 Paragraph 2c, the ultimate determination of whether to grant a security clearance must be an overall common sense 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. Applicant has a history of not meeting his financial obligations. The evidence establishes that his financial difficulties will most likely continue for some time, leaving him both unable to address the approximately $18,900.00 in delinquent unsecured debt listed in the SOR and vulnerable to further financial delinquencies. These facts leave me no choice but to conclude applicant failed to mitigate the security concerns arising from Guideline F.

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

CONCLUSION

In light of all of the circumstances presented by the record in this case, it is not clearly consistent with national security to grant applicant eligibility for a security clearance. Eligibility for access to classified information is denied.

JOSEPH TESTAN Administrative Judge