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ISCR Case 08-08113.h1 — CASE

ISCR Case 08-08113.h1denied

Case Headnote

ISCR Case No. 08-08113.h1

deniedJul 1, 2008· Hon. Elizabeth M. Matchinski· hearing

Summary

A 34-year-old defense contractor employee was denied a security clearance under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The denial stemmed from significant delinquent debts totaling over $13,600 and the omission of a January 2008 assault charge from his security clearance application.

Regarding the personal conduct issue, the judge found that the applicant did not intend to conceal the assault charge. However, the financial issues were not sufficiently mitigated. The applicant owed delinquent debts for rent, medical bills, various telephone services, cable television, a computer purchase, tax debts, and two vehicle purchases, along with other unspecified delinquent debts. He also had two credit card debts that were settled for less than the full balance and a personal loan he was repaying.

The denial was primarily due to the applicant's financial irresponsibility, as evidenced by the substantial delinquent debt. His repayments were largely reactive, made in response to collection efforts rather than proactive engagement with creditors. Furthermore, he failed to contact several creditors regarding his overdue balances.

Why the Applicant Was Denied

Applicant owes delinquent debt exceeding $13,600, indicating financial irresponsibility.
Repayments were made in response to collection efforts rather than proactive measures.
Applicant failed to contact several creditors regarding overdue balances.

Conditions Referenced

Disqualifying

AG ¶ 19(a)appliedInability or Unwillingness to Satisfy Debts
AG ¶ 19(c)appliedA History of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(b)appliedConditions Beyond the Person's ControlSome financial issues were influenced by low wages and personal circumstances.
AG ¶ 20(c)rejectedReceiving Counseling for Financial ProblemsApplicant has not received formal counseling since 1998/99.

Key Rule Quoted

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

Procedural Posture

SOR issuedJun 23, 2009
Answer filedJul 13, 2009
Hearing heldSep 18, 2009
Decision dateMar 25, 2010

Cite For

Financial Irresponsibility Under Guideline F
Failure to Mitigate Financial Obligations
Personal Conduct Concerns Related to Omissions in 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 that the applicant did not deliberately falsify his security clearance application regarding an assault charge, as he lacked the intent to conceal this information. The judge ruled in favor of the applicant on the personal conduct allegation under Guideline E, concluding that the concerns were mitigated by the applicant's voluntary disclosure during an interview.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a	Applicant omitted a January 2008 assault charge from his security clearance application.	For Applicant	Omission or Failure to DiscloseNOT DELIBERATE	Criminal Conduct	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 multiple financial concerns under Guideline F, with the applicant owing significant delinquent debts totaling over $13,600. While some debts were settled, the applicant's ongoing financial issues and failure to resolve most debts led to a decision against him.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant had rent that he failed to pay.	Against Applicant	Unspecified Financial	Admitted	(c) a history of not meeting financial obligations	—	—
1.b	Applicant has medical debts that he failed to pay.	Against Applicant	Medical Debt	Admitted	(c) a history of not meeting financial obligations	—	—
1.c	Applicant has telephone charges that he failed to pay.	Against Applicant	Utility or Phone Debt	Admitted	(c) a history of not meeting financial obligations	—	—
1.d	Applicant has wireless telephone charges that he failed to pay.	Against Applicant	Utility or Phone Debt	Admitted	(c) a history of not meeting financial obligations	—	—
1.e	Applicant has credit card debt that he settled for less than the full balance. $300	For Applicant	Credit Card Debt	Admitted	—	—	—
1.f	Applicant has wireless telephone debt that he failed to pay.	Against Applicant	Utility or Phone Debt	Denied	(c) a history of not meeting financial obligations	—	—
1.g	Applicant has cable television charges that he failed to pay.	Against Applicant	Unspecified Financial	Admitted	(c) a history of not meeting financial obligations	—	—
1.h	Applicant has delinquent debts related to a computer purchase. $300	Against Applicant	Credit Card Debt	Admitted	(c) a history of not meeting financial obligations	—	—
1.i	Applicant has tax debts that he failed to pay.	Against Applicant	Tax Unpaid	Denied	(c) a history of not meeting financial obligations	—	—
1.j	Applicant has credit card debt that he settled for less than the full balance. $280	For Applicant	Credit Card Debt	Admitted	—	—	—
1.k	Applicant has a personal loan that he is repaying. $950	For Applicant	Personal Loan Debt	Admitted	—	—	—
1.l	Applicant has delinquent debts related to a vehicle purchase.	Against Applicant	Auto Loan Debt	Denied	(c) a history of not meeting financial obligations	—	—
1.m	Applicant has additional delinquent debts that he failed to pay.	Against Applicant	Unspecified Financial	Denied	(c) a history of not meeting financial obligations	—	—
1.n	Applicant has additional delinquent debts that he failed to pay.	Against Applicant	Unspecified Financial	Denied	(c) a history of not meeting financial obligations	—	—
1.o	Applicant has delinquent debts related to a vehicle purchase.	For Applicant	Auto Loan Debt	Admitted	—	—	—
1.p	Applicant has additional delinquent debts that he failed to pay.	Against Applicant	Unspecified Financial	Denied	(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. 08-08113 SSN: ----------------- ) ) Applicant for Security Clearance )

For Government: Gina L. Marine, Esquire, Department Counsel For Applicant: Pro Se

March 25, 2010 ______________

STATEMENT OF CASE

______________

MATCHINSKI, Elizabeth M., Administrative Judge:

Applicant owes delinquent debt in excess of $13,600, after settling two debts for less than their full balances and paying $195 on a judgment debt of about $3,044 in the summer of 2009. Financial considerations are not fully mitigated where the repayments are in response to collection efforts and he has yet to contact some of his creditors owed balances long overdue. Personal conduct concerns are not established by Applicant’s omission of a January 2008 assault charge from his security clearance application because he lacked the intent to conceal and volunteered the information during his April 2008 interview. Clearance is denied.

Statement of the Case

Applicant submitted an Electronic Questionnaire for Investigations Processing (e- QIP) on March 14, 2008. On June 23, 2009, the Defense Office of Hearings and Appeals (DOHA) issued to Applicant a statement of reasons (SOR) detailing the security concerns under Guideline F, financial considerations, and Guideline E, personal conduct, that provided the basis for its preliminary decision to deny him a security clearance and to refer the matter to an administrative judge. 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) effective within the Department of Defense as of September 1, 2006.

On July 13, 2009, Applicant answered the SOR and requested a hearing. The case was assigned to me on August 6, 2009, to conduct a hearing and to determine whether it is clearly consistent with the national interest to grant or continue a security clearance for Applicant. On August 11, 2009, I scheduled a hearing for September 18, 2009.

I convened the hearing as scheduled. Six government exhibits (Ex. 1-6) and eight Applicant exhibits (Ex. A-H) were admitted into evidence without objection. Applicant and his fiancee testified, as reflected in a transcript (Tr.) received on September 25, 2009.

At Applicant’s request, I held the record open for additional documentation until October 2, 2009. On October 1, 2009, Applicant’s fiancee submitted on Applicant’s behalf eight documents that were entered as exhibits I through P without objection.

FINDINGS OF FACT

DOHA alleged under Guideline F, financial considerations, that Applicant owed delinquent debt totaling $15,856 to 16 creditors (SOR 1.a-1.p). Under Guideline E, personal conduct, Applicant was alleged to have deliberately falsified his March 14, 2008, e-QIP by not listing his arrest in January 2008 for assault and breach of peace (SOR 2.a). In his Answer, Applicant admitted the debts excepting the wireless telephone debt in SOR 1.f, although he indicated that he had reduced the balance of the debt in SOR 1.e to $65 and he was paying $65 per month on the debt in SOR 1.k. Applicant denied that he deliberately omitted his assault arrest from his security clearance application. Applicant’s admissions to various delinquencies are accepted and incorporated as findings of fact. After considering the pleadings, exhibits, and transcript, I make the following additional factual findings.

Applicant is 34 years old, and has been an employee of a defense contractor since early December 2007 (Ex. 1, A, Tr. 91). He seeks his first Department of Defense security clearance. Applicant started as a welder, but he has worked in the radiology field since February 2009 (Tr. 112).

Applicant previously worked as an assistant teacher in state X, starting at an hourly wage of $6.50 or $7 in October 1995. From August 1997, when he switched employers, he was paid between $8 and $9 hourly (Ex. 1, Tr. 107). Due to low wages and poor budgeting, Applicant had problems meeting his financial obligations. In about 1996, he defaulted on a student loan that he had taken out for higher education (Tr. 70). In about 1998 and 1999, he satisfied some consumer credit obligations with the assistance of a debt resolution firm. Applicant paid the company about $185 per month for two years. He stopped making the payments because he felt that the company was taking more of his money than the firm was paying to his creditors (Tr. 81-82). Applicant took out a loan of $2,000 in 1999 (SOR 1.n) that he used to satisfy some credit card balances (Tr. 77-78), but he then did not make his payments on the loan (Tr. 78).

In late September 2000, Applicant had a daughter (Tr. 90). He married in October 2000, but he and his first wife were divorced within months. Applicant incurred about $563 in credit card charges (SOR 1.j) for clothing for his daughter. He and the mother of his child agreed that he would pay $325 in child support per month. Applicant has been timely in his child support payments (Ex. 3, L, Tr. 90), but he made no payments on the credit card account after November 2001 (Ex. 1-5, Tr. 66-67).

Applicant married his second wife in April 2001 (Ex. 1). Applicant became a stepfather to her daughter born in 1997 (Ex. D-G). Applicant and his spouse filed joint income tax returns for tax year 2002, as a nonresident or part-time resident of state X where Applicant was employed. He and his spouse lived in adjacent state Y (Ex. 1, D).3 Their joint wages were $38,999, of which Applicant earned $14,125.64 (Ex. D). For tax year 2003, Applicant and his spouse earned $48,822 with Applicant contributing about $17,706 from his employment in state X (Ex. E).

In 2004, Applicant moved to state Z in the southeastern U.S. while his spouse remained in state Y. They filed joint income tax returns listing wages of $48,388, with Applicant having earned income in states X, Y, and Z of about $23,266 (Ex. F). Applicant and his spouse apparently lived apart in 2005, although they filed joint tax returns. Their joint income increased slightly, to $49,563. Applicant earned $20,100 from work with five different employers in state Z (Ex. G). Applicant filed as a single taxpayer in 2006, listing adjusted gross income of $32,579 in state Z (Ex. H). In December 2007, Applicant and his second wife divorced (Ex. 1).

Applicant fell behind on several financial obligations, while living in state Y and after he moved to state Z. He incurred credit card charges (SOR 1.e, 1.p), including for a computer (SOR 1.k), telephone costs (SOR 1.c, 1.d, 1.f, 1.g, 1.m), cable television fees (SOR 1.h), and medical debts (SOR 1.b, 1.i) that became delinquent (Ex. 1-6). In September 2006, an $875 lien was filed by state X’s tax authority (Ex. 1-4), which Applicant indicated was related to his student loan debt that should have been paid through interception of his tax refunds (Tr. 75). However, it is noted that Applicant apparently did not file a state X return for tax year 2003, even though he earned $17,706 in the state that year (Ex. E). In July 2006, Applicant purchased a 2003 model- year vehicle for $19,487. His account was referred for collection for nonpayment as of October 2006, and in about December 2007, he paid less than the full balance to settle the debt (Ex. 4). He borrowed $9,000 from his father to settle the debt. He is repaying the loan at $200 per month, and he turned over his $800 income tax refund for 2008 to his father in partial repayment of the loan (Tr. 88-89).

In July 2007, Applicant moved to his present geographic locale. From August to October 2007, he worked about three to four hours a day at $9.50 to $10 an hour in an office. He was unemployed until December 3, 2007, when he started working for his current employer at $13/25 an hour (Ex. A, Tr. 105-06). He was given an e-QIP to complete in December 2007 (Tr. 96-99, 101). He responded negatively to question 23.fconcerning any arrests within the last seven years. In response to the debt inquiries, he listed 13 delinquent debts (SOR 1.a, 1.c-1.e, 1.g-1.n, 1.p) as they appeared on a report of his credit that he obtained (Ex. 1, Tr. 63).

After he had submitted his initial response to question 23.fon the e-QIP, Applicant was arrested for domestic assault and disturbing the peace in early January 2008. Applicant and his fiancee argued while driving from state Y back to his home, and they stopped in a parking lot while continuing to argue. He put his arms around his fiancee, and an observer called the police. Applicant was arrested, and in court he pleaded no contest on the advice of the district attorney (Ex. 2, Tr. 48).

On March 14, 2008, Applicant submitted his signed e-QIP (Ex. 1). He did not correct his negative response to question 23.fbecause he mistakenly recalled the inquiry as limited to felony arrests and he did not review the form carefully before he signed it (Ex. 2, Tr. 37, 98, 103).

In March 2008, Applicant took out a personal loan of $950 with a bank that he is repaying at $43.40 per month (Ex. 5, M). He used some of the funds to obtain a secure credit card account in April 2008 with a $500 credit limit (Ex. 5, Tr. 86-87). On April 30, 2008, Applicant was interviewed by a government investigator about his finances. He expressed his belief that he did not owe state X’s tax authority, the medical debts, which should have been covered by insurance, the computer debt in SOR 1.kor the wireless phone debt in SOR 1.f. He indicated that he had been paying on the credit card debt in SOR 1.e, so the balance had been reduced from $577 to $386. Applicant did not dispute the other debt balances, and he expressed his intent to resolve them. He planned to satisfy the smaller debts (SOR 1.hand 1.p) by December 2008 and the rest of his debts by December 2013. Applicant volunteered that he had been arrested in January 2008 for domestic assault and disturbing the peace, but the state did not prosecute him in return for good behavior for 18 months. He explained that he had not listed the charges on his e-QIP because he thought only felonies needed to be reported (Ex. 2).

In June 2008, Applicant opened a credit card with a $300 limit that had a balance of $331 as of July 2008 (Ex. 5). By February 2009, the lender had closed the account because he was two months behind ($31) in his payments (Ex. 6), although he subsequently caught up in his payments as of August 2009 (Ex. K). As of mid-June 2008, Applicant had a negative balance of $60.10 in his checking account due in part to his habit of eating in fast food establishments and stopping for coffee. He reduced those expenses at the urging of his fiancee, and had a net positive balance of $337.21 the following month (Ex. N).

DOHA subsequently sent financial interrogatories to Applicant requesting documentation of any payments on his delinquent debts. Applicant responded on December 9, 2008, that his monthly income of $1,516 was sufficient only to cover his daily living expenses, including his child support and $245 in loan repayments to his father and the bank. Applicant expressed his intent to repay the debt when his finances permitted, hopefully within the next five years (Ex. 3).

In mid-June 2009, Applicant stipulated to a judgment in court, agreeing to repay $65 per month starting in mid-July (Ex. C) for the computer he purchased for $2,398 in about February 2002 (SOR 1.k). Due to interest, the debt had risen to more than $3,044 (Ex. 5). He paid $65 on July 16, 2009, August 3, 2009, and August 31, 2009 (Ex. O). On July 31, 2009, Applicant settled the credit card debt in SOR 1.j, paying about $280 of the approximate $694 balance (Ex. 3, 5, J, Tr. 67-68). He testified that in about August 2009, he settled the debt in SOR 1.e for about $300, using a credit card to do so (Tr. 58). As of September 2009, he disputed his liability for the medical debts in SOR 1.band 1.i on the basis that they should have been covered by insurance (Tr. 31), and for the wireless telephone debt in SOR 1.fbecause the company is his current carrier and presumably would not have taken him on as a customer if he had an unpaid balance (Tr. 61-62). Applicant did not dispute the debts with the credit bureaus because he was unaware of the process (Tr. 62). He also questioned the validity of the tax judgment in SOR 1.l. (Tr. 75). Applicant responded to collection efforts by the creditors in SOR 1.e, 1.j, and 1.k. He has not contacted those creditors holding undisputed debts who have yet to pursue collection (SOR 1.a, 1.c, 1.d, 1.g, 1.m, 1.n, 1.pand 1.o (duplicate of 1.a)) (Tr. 56, 64, 76-78, 80, 113) because he has been trying to get his life on track (Tr. 54). He learned from the cable company that his debt had been sent for collection so he would have to wait for the assignee to contact him, so that debt also was unpaid (Tr. 64- 65). Applicant intends to satisfy his outstanding delinquencies within the next three years (Tr. 54-55).

Applicant’s work performance has been fully satisfactory since he started with the defense contractor. In early September 2009, he passed a certification examination in handling radioactive materials (Ex. P). He received pay raises over time from his initial $13.25 hourly base rate to his present $17.07 per hour, supplemented by a shift differential and overtime pay when available (Ex. A). During the weeks of August 9, 2009, through September 19, 2009, his weekly take-home pay ranged from $369.87 to $472.69 (Ex. L). He had been residing with his fiancee for the past year (Tr. 109), and was contributing $535 per month toward their rent (Ex. O). His fiancee earns about $17 an hour from her work as a research coordinator (Tr. 109-10). She handles paying the household expenses (Tr. 81, 119), and has been working with him to reduce his expenses, especially eating out, and to live within a budget (Tr. 81, 120-22). His financial situation has improved of late to where he was able to save $100 last month (Tr. 114, 136). His fiancee has accumulated $8,000 in savings in an account in her name, about $2,000 of which represents contributions from Applicant (Tr. 130-31). She has not given him access to the funds because she wants Applicant to learn to live below his means and not count on overtime pay to meet expenses (Tr. 129, 132). In August 2009, he bought his fiancee a $500 laptop computer for her birthday, putting $100 on credit and paying cash for the rest. He had saved the funds from working overtime on Sundays since May or June 2009 (Tr. 137-42). As of September 2009, Applicant was eating out once a week whereas he had been doing so daily about a year ago (Tr. 140-41, 143).

POLICIES

The U.S. Supreme Court has recognized the substantial discretion the Executive Branch has in regulating access to information pertaining to national security, emphasizing that “no one has a ‘right’ to a security clearance.” Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). 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 required to be considered 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 access to classified information 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. 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, the applicant is responsible for presenting “witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by applicant or proven by Department Counsel. . . .” The applicant 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 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 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 about finances 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.

Applicant has had problems meeting his financial obligations for the past decade. He retained the services of a debt resolution firm over the 1998/99 time frame but he stopped making his payments over concerns about allocation of his monies paid to the debt repayment plan. He satisfied some credit card debt through a $2,000 loan and then did not repay the loan. During his second marriage, he was timely in his child support payments. Yet, he incurred new debt, including $3,903 in wireless telephone charges on a family plan (SOR 1.d). After he moved to state Z in 2004, he had rent (SOR 1.a and 1.o, duplicate), cable television (SOR 1.h), and telephone charges (SOR 1.g, 1.m) that he failed to pay. When he submitted his e-QIP in March 2008, his credit record showed outstanding delinquent balances totaling about $13,978. AG ¶ 19(c), “a history of not meeting financial obligations, and ” AG ¶ 19(a), “inability or unwillingness to satisfy debts,” clearly apply.

As of September 2009, Applicant had not resolved most of the debts in the SOR. Only those delinquencies in SOR 1.jand apparently SOR 1.e had been satisfied, albeit for less than their full balances, and with respect to SOR 1.e, by relying on credit that will have to be repaid. AG ¶ 20(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,” cannot reasonably apply where there are ongoing financial issues. There is credible evidence that would implicate low wages as a negative influence on Applicant’s financial situation, certainly before 2002 and perhaps during his marriage. See AG ¶ 20(b) (stating, “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”). Joint income tax returns filed with his second wife for tax years 2002 through 2005 show that he earned $14,125.64, $17,706, $23,366, and $20,100 over those four years. Their joint income, which was more than $48,000 in each of the tax years 2003, 2004, and 2005, would seem to have been enough to make some payments on his debts, but it is also not clear whether Applicant’s spouse helped him financially. Applicant also had separate living expenses after he moved to state Z in 2004, if not before then, and the ongoing child support obligation for his daughter. After he moved to his present locale in 2007, he worked only part-time and was unemployed from October 2007 until early December 2007. AG ¶ 20(b) applies in part, but it does not extenuate the financial judgment concerns raised by his spending habits. He ate out on a daily basis without regard to whether he could afford to do so, as evidenced by a negative balance on his bank account as of June 2008. In August 2009, he bought a laptop computer for his fiancee, spending $400 of his savings when most of his creditors had not been paid.

Applicant has received no formal counseling since he was involved in the debt repayment plan in 1998/99, although his fiancee has given him good advice about reducing his spending and not relying on overtime earnings to cover incurred costs. His bank records submitted after the hearing confirm a significant reduction in the frequency of his spending on fast food meals from June to July 2008. Yet, while he no longer overdraws his bank account, recent reliance on loans and credit cards for debt payments tend to indicate that his problems are not yet resolved. He borrowed $9,000 from his father that he used to settle his delinquent car loan in December 2007. In March 2008, he took out a $950 loan from a bank, in part to acquire a secure credit card. In August 2009, he settled the debt in SOR 1.e by transferring balances from one lender to another. A credit card account opened in June 2008 was closed after he fell behind in his payments. Under these circumstances, it would be premature to apply AG 20(c), “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.”

In addition to settling the debts in SOR 1.e in August 2009, and SOR 1.jin late July 2009, Applicant has been repaying a judgment for the computer debt in SOR 1.ksince July 2009. However, these efforts to resolve his debts, post issuance of the SOR, and in response to collection efforts, are not sufficient to apply AG ¶ 20(d), “the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.”

AG ¶ 20(e), “the individual has a reasonable basis to dispute the legitimacy of the past-due debt which is the cause of the problem and provides documented proof to substantiate the basis of the dispute or provides evidence of actions to resolve the issue,” could apply to the tax lien as it does not appear on his recent credit reports. However, the wireless phone debt in SOR 1.fand the medical debts were being reported as outstanding collection balances. Absent any evidence of insurance coverage applicable to the medical debts, or of documentation disproving his liability for the wireless phone debt in SOR 1.for the tax lien, AG ¶ 20(e) is not satisfied. Despite the favorable changes in his spending habits, Applicant has not fully mitigated the financial concerns.

Guideline E, Personal Conduct

The security concern about 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.

Applicant does not dispute that he failed to disclose his January 2008 assault arrest on his March 2008 e-QIP, but he denies that he intended to conceal the information. He testified credibly that he was initially asked to complete the form in December 2007, around the time of his hiring by the defense contractor. He read the police inquiries as limited to felony offenses when he initially reviewed the form. In response to the financial record inquiries, he made a concerted effort over the next few months to obtain his credit record and to list his delinquencies on the e-QIP. By the time he signed and submitted his e-QIP in March 2008, the state had agreed not to prosecute him on the criminal charges. The evidence does not substantiate that he had the intent to deceive or conceal that is required under AG ¶ 16(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.”

Concerns about his lack of candor are unsubstantiated (see AG ¶ 17(f), “the information was unsubstantiated or from a source of questionable reliability”) because of his disclosures of his financial problems on the e-QIP and his candor during his April 30, 2008, interview with a government investigator. As reflected in the investigator’s report of the interview (Ex. 2), Applicant volunteered the fact of his assault arrest in January 2008, which is inconsistent with an intent to conceal. AG ¶ 17(a), “the individual made prompt, good faith efforts to correct the omission, concealment, or falsification before being confronted with the facts,” is 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 conduct and all the relevant circumstances in light of 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.

Applicant’s inability to remain current in his financial obligations was due in part to limited income, but also to poor financial management. He had a habit of spending on restaurant meals daily, without regard to whether he had the funds to cover the costs. A family member or friend incurred excessive wireless phone charges on the family account Applicant had opened in or before March 2006, but Applicant’s ongoing disregard of this and other delinquencies continues to cast doubts about his financial judgment. Largely because of his fiancee’s advice and help, he has begun changing his financial behavior to ensure no new delinquencies. But I cannot conclude that his financial problems are safely in the past, given he has resolved only a few of his delinquent debts and he was behind as of February 2009 on a credit card account that he had held only since June 2008. If Applicant can establish a payment plan on his SOR debts for six months, and no other security concerns arise, he will be a good candidate for a security clearance when again eligible 12 months after the date of this decision.

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

Subparagraph 1.a: Against Applicant Subparagraph 1.b: Against Applicant Subparagraph 1.c: Against Applicant Subparagraph 1.d: Against Applicant Subparagraph 1.e: For Applicant Subparagraph 1.f: Against Applicant Subparagraph 1.g: Against Applicant Subparagraph 1.h: Against Applicant Subparagraph 1.i: Against Applicant Subparagraph 1.j: For Applicant Subparagraph 1.k: For Applicant Subparagraph 1.l: Against Applicant Subparagraph 1.m: Against Applicant Subparagraph 1.n: Against Applicant Subparagraph 1.o: For Applicant Subparagraph 1.p: Against Applicant Paragraph 2, Guideline E: FOR APPLICANT

Subparagraph 2.a: For Applicant

CONCLUSION

In light of 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.

Elizabeth M. Matchinski Administrative Judge

FOOTNOTES

DOHA alleged that Applicant falsified a Questionnaire for National Security Positions (SF 86). The SF 86 is part of the e-QIP (Ex. 1). It is unclear whether his daughter was born to Applicant and his first wife or from another relationship. Applicant did not list his daughter on his e-QIP (Ex. 1).

Applicant filed his income tax returns listing his spouse’s address (Ex. D). He reported a different address for himself in state Y on his e-QIP (Ex. 1).

Applicant testified that the $4,767 balance on his wireless phone account in SOR 1.dwas on a family plan where someone else ran up the bill. He is still waiting for this person to cover the cost (Tr. 56). After the hearing, Applicant submitted his three latest pay stubs showing weekly deductions of $80 and $75 along with annotations identifying the $80 as child support and the $75 going to the bank from which he and his fiancee pay their joint household expenses (Ex. L, M, Tr. 119).