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ISCR Case 08-03040.h1 — CASE

ISCR Case 08-03040.h1denied

Case Headnote

ISCR Case No. 08-03040.h1

deniedDec 29, 2008· Hon. Joseph Testan· hearing

Summary

A 43-year-old defense contractor was denied a security clearance due to concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The denial stemmed from significant financial delinquencies and intentional misrepresentation on his security clearance application.

The applicant's Statement of Reasons detailed numerous financial issues. These included delinquent debts to California BU/Medical ($25.00), another medical account ($33.00), OPN Credit/Old Point/Automobile ($7,438.00), Meritech mortgage ($5,759.00 past-due), Cap 1 Bank ($825.00 past-due), Prince Park/Triangle Rent A Car, Inc. ($136.00), Jeffersncp ($1,933.00), and Providian ($1,724.00). A $525.00 judgment was entered against him in April 2007, and as of March 2008, he owed the Commonwealth of Virginia at least $2,222.09 in past-due child support. Additionally, his Chapter 13 bankruptcy petition, filed in January 2003, was dismissed in April 2006 for failure to make payments.

Crucially, in September 2007, the applicant falsely denied on his e-QIP that he had unpaid judgments, had been over 180 days delinquent on any debt in the prior seven years, or was currently over 90 days delinquent. The judge found that the applicant's ongoing financial issues and lack of credible evidence of resolution, combined with his intentional misrepresentation, undermined his reliability and trustworthiness, leading to the denial of his security clearance.

Why the Applicant Was Denied

The applicant has a history of not meeting financial obligations, indicating poor self-control and lack of judgment.
The applicant intentionally provided false information on his security clearance application regarding his financial delinquencies.
The applicant failed to demonstrate any meaningful action to resolve his delinquent debts.

Conditions Referenced

Disqualifying

F.19.aappliedInability or Unwillingness to Satisfy Debts
F.19.cappliedHistory of Not Meeting Financial Obligations
E.16.aappliedDeliberate Omission, Concealment, or Falsification of Relevant Facts

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 issuedJun 9, 2008
Answer filedJul 12, 2008
Hearing held—Applicant appeared Pro Se.
Decision dateDec 29, 2008

Cite For

Disqualifying Conditions Related to Financial Considerations Under Guideline F
Disqualifying Conditions Related to Personal Conduct Under Guideline E
Intentional Misrepresentation on Security Clearance Applications

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 personal conduct concerns under Guideline E, specifically regarding the deliberate falsification of information on a security questionnaire. The applicant's lack of candor and dishonesty raised significant questions about his reliability and trustworthiness.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a	Applicant completed an Electronic Questionnaire for Investigations Processing (e-QIP) in September 2007. In response to three questions on the e-QIP, applicant denied that (1) in the prior seven years he had any judgments against him that he had not paid, (2) in the prior seven years he had been over 180 days delinquent on any debt, and (3) he was then over 90 days delinquent on any debts. In fact, at minimum, applicant was over 180 days delinquent on his debts to California BU/Medical, OPN Credit, the Commonwealth of Virginia, Jeffersncp, and Providian when he completed the e-QIP. And, the $525.00 judgment debt, which remains unpaid, was entered against him in April 2007.	Against Applicant	Falsification Security FormFOUND DELIBERATE	Financial	Denied	(a) deliberate omission, concealment, or falsification on a security form	—	—

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 that the applicant had a significant history of financial delinquencies, including multiple debts that were in collection and a judgment against him. The applicant's failure to address these financial issues and provide credible evidence of mitigation led to a decision against him under Guideline F.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant was indebted to California BU/Medical in the approximate amount of $25.00. This account is delinquent and has been placed for collection. $25	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Applicant was indebted to a medical account in the approximate amount of $33.00. This account is delinquent and has been placed for collection. $33	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	Applicant was indebted to OPN Credit/Old Point/Automobile in the approximate amount of $7,438.00. This account is delinquent and has been placed for collection. $7,438	Against Applicant	Auto Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	Applicant was indebted to Meritech mortgage in the approximate past-due amount of $5,759.00. $5,759	Against Applicant	Mortgage or Home Loan Debt	Denied with Explanation	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	Applicant is indebted to P***** R**** GE in the amount of $525.00 as a result of a judgment entered against him in April 2007. $525	Against Applicant	Judgment Against Applicant	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	Applicant is indebted to Cap 1 Bank in the approximate amount of $825.00. This debt is past-due. $825	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	Applicant is indebted to Prince Park /Triangle Rent A Car, Inc. in the approximate amount of $136.00. This debt has been placed for collection. $136	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	As of March 2008, applicant owed the Commonwealth of Virginia at least $2,222.09 in past-due child support. $2,222	Against Applicant	Child Support Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	Applicant is indebted to Jeffersncp in the approximate amount of $1,933.00. This delinquent debt originated with Aspire Visa. $1,933	Against Applicant	Credit Card Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.j	Applicant is indebted to Providian in the approximate amount of $1,724.00. $1,724	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.k	Applicant filed a Chapter 13 bankruptcy petition in January 2003. His case was dismissed in April 2006 for failure to make payments to the bankruptcy trustee.	Against Applicant	Bankruptcy Filing	Admitted	(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. 08-03040 SSN: ----------- ) ) Applicant for Security Clearance )

For Government: Emilio Jaksetic, Department Counsel For Applicant: Pro Se

December 29, 2008

______________

STATEMENT OF CASE

______________

TESTAN, Joseph, Administrative Judge:

On June 9, 2008, the Defense Office of Hearings and Appeals (DOHA) issued a Statement of Reasons (SOR) to applicant detailing the security concerns under Guidelines E and 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 July 12, 2008, and requested an Administrative Determination by an Administrative Judge (AJ). Department Counsel issued a File of Relevant Material (FORM) on August 18, 2008. Applicant did not file a response to the FORM. The case was assigned to me on October 29, 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 43 year old employee of a defense contractor.

Applicant admits that as of May 30, 2008, he was indebted to the following creditors in the following approximate amounts: California BU/Medical $25.00; a medical account $33.00; and OPN Credit/Old Point/Automobile $7,438.00. All three accounts are delinquent and have been placed for collection.

As of May 2008, applicant was indebted to Meritech mortgage in the approximate past-due amount of $5,759.00. Even if this debt was “taken over” by applicant’s ex-wife as he claims in his SOR response, without a release from the creditor, he is still liable for the debt.

Applicant is indebted to P******* R****** GE in the amount of $525.00 as a result of a judgment entered against him in April 2007.

Applicant is indebted to Cap 1 Bank in the approximate amount of $825.00. This debt is past-due.

Applicant is indebted to Prince Park /Triangle Rent A Car, Inc. in the approximate amount of $136.00. This debt has been placed for collection.

As of March 2008, applicant owed the Commonwealth of Virginia at least $2,222.09 in past-due child support.

Applicant is indebted to Jeffersncp in the approximate amount of $1,933.00. This delinquent debt originated with Aspire Visa (Exhibits 5 and 7).

Applicant is indebted to Providian in the approximate amount of $1,724.00 (Exhibits 4 and 7).

Applicant filed a Chapter 13 bankruptcy petition in January 2003. His case was dismissed in April 2006 for failure to make payments to the bankruptcy trustee.

Applicant provided a personal financial statement to DOHA in April 2008, which showed he had approximately $428.00 in discretionary income. In his response to the SOR, applicant stated this “extra” income is being used to “catch up on child support payments.”

Applicant completed an Electronic Questionnaire for Investigations Processing (e-QIP) in September 2007. In response to three questions on the e-QIP, applicant denied that (1) in the prior seven years he had any judgments against him that he had not paid, (2) in the prior seven years he had been over 180 days delinquent on any debt, and (3) he was then over 90 days delinquent on any debts. In fact, at minimum, applicant was over 180 days delinquent on his debts to California BU/Medical, OPN Credit, the Commonwealth of Virginia, Jeffersncp, and Providian when he completed the e-QIP. And, the $525.00 judgment debt, which remains unpaid, was entered against him in April 2007. In his response to the SOR, applicant denied that he deliberately provided the false information. I find that applicant’s false answers were intentional.

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 an inability or unwillingness 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 failure to honor his financial obligations is ongoing, and it casts doubt on his current reliability and judgment. Accordingly, 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.” Applicant failed to provide any credible evidence to support application of this mitigating condition.

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. There is no evidence of counseling. And, the problem is not being resolved and it is clearly not under control. Accordingly, 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.

Guideline E, Personal Conduct

The security concern relating to the guideline for Personal Conduct is set forth in Paragraph 15 of the AG, and is as follows:

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.

Paragraph16 describes conditions that could raise a security concern and may be disqualifying. Under Paragraph 16.a., the “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,” may be disqualifying. This disqualifying condition is applicable.

I considered the potentially mitigating conditions under this Guideline and conclude none 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 and not being truthful with the Government about his financial delinquencies. With the possible exception of his child support debt, he failed to offer any credible evidence that he is taking any meaningful action to repay his delinquent debts. Under the circumstances, I have no choice but to conclude applicant failed to mitigate the security concerns arising from Guidelines E and 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:

Guideline E: AGAINST APPLICANT

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