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ISCR Case 08-09316.h1 — CASE

ISCR Case 08-09316.h1denied

Case Headnote

ISCR Case No. 08-09316.h1

deniedMar 18, 2011· Hon. Robert Robinson Gales· hearing

Summary

A 33-year-old defense contractor employee was denied a security clearance under Guideline F, Financial Considerations, due to multiple admitted financial delinquencies and two bankruptcies. The applicant faced allegations concerning ongoing debts totaling approximately $44,710.

Specific allegations included a disputed account with a balance of $127, another dental account for $1,705 claimed to have multiple inaccuracies, and a 2003 judgment of $5,560 for which the applicant denied liability related to a business lease termination. The applicant also disputed a $34,029 debt for a repossessed automobile, claiming it was too old and illegitimate. Additionally, the applicant contended that three other accounts had been paid and that there were duplicate entries for a collection agency regarding another account.

The denial was based on the applicant's failure to provide sufficient evidence of mitigating circumstances or a good-faith effort to resolve her financial issues. The judge found that the applicant did not demonstrate control over her financial problems or participation in financial counseling.

Why the Applicant Was Denied

The applicant admitted to multiple financial delinquencies and two bankruptcies.
The applicant failed to provide evidence of a good-faith effort to resolve her debts.
The applicant did not demonstrate that her financial issues were under control or that she had received financial counseling.

Conditions Referenced

Disqualifying

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

Key Rule Quoted

“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.”
— AG ¶ 18

Procedural Posture

SOR issuedMar 2, 2010
Answer filedApr 6, 2010Applicant elected to have the case decided on the written record.
Hearing held—No hearing; decision based on written record.
Decision dateMar 18, 2011

Cite For

Denial Based on Financial Delinquencies Under Guideline F
Lack of Evidence for Mitigating Circumstances in Financial Issues
Importance of Demonstrating Good-faith Efforts to Resolve Debts

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 judge found against the applicant on all allegations under Guideline F, indicating significant financial issues including multiple delinquencies and a history of bankruptcy filings. The applicant failed to provide sufficient evidence to mitigate the security concerns raised by her financial situation, leading to the denial of her security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	disputed one account (SOR ¶ 1.a.) with an identified account number, because the SOR alleged the unpaid balance was $127, while one credit report indicated the balance was $120 and a credit report from the following year said it was $127. $127	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Applicant contends she has paid three of the accounts (SOR ¶¶ 1.i., 1.j., and 1.m.) and claims 'there are duplicates' for the collection agency regarding SOR ¶ 1.b.	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	disputed another dental account (SOR ¶ 1.c.) in the amount of $1,705, claiming 'multiple inaccuracies,' but did not specify what those inaccuracies were. $1,705	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d–1.h	5 sub-charges — specific text not stated in this decision (against the applicant). (low confidence)	Against Applicant			—	—	—
1.i	Applicant contends she has paid three of the accounts (SOR ¶¶ 1.i., 1.j., and 1.m.) and claims 'there are duplicates' for the collection agency regarding SOR ¶ 1.b.	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.j	Applicant contends she has paid three of the accounts (SOR ¶¶ 1.i., 1.j., and 1.m.) and claims 'there are duplicates' for the collection agency regarding SOR ¶ 1.b.	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.k	specific text not stated in this decision	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.l	disputed a 2003 judgment (SOR ¶ 1.l.) in the amount of $5,560, claiming she should not have been liable for charges related to the early termination of a lease for her business. $5,560	Against Applicant	Judgment Against Applicant	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.m	specific text not stated in this decision	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.n	disputed one account (SOR ¶ 1.n.) pertaining to a repossessed automobile in the amount of $34,029, claiming the debt was too old and it was not legitimate. $34,029	Against Applicant	Auto Loan Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.o–1.t	6 sub-charges — specific text not stated in this decision (against the applicant). (low confidence)	Against 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. 08-09316 ) ) Applicant for Security Clearance )

For Government: Braden M. Murphy, Esquire, Department Counsel For Applicant: Pro se

March 18, 2011 ______________

STATEMENT OF CASE

______________

GALES, Robert Robinson, Administrative Judge:

Applicant failed to mitigate the security concerns regarding financial considerations. Eligibility for a security clearance and access to classified information is denied.

Statement of the Case

On April 17, 2008, Applicant applied for a security clearance and submitted a Questionnaire for Sensitive Positions version of a Security Clearance Application (SF 86).1 On February 4, 2009, the Defense Office of Hearings and Appeals (DOHA) issued her a set of interrogatories pertaining to her finances. She responded to the interrogatories on March 23, 2009.2 On March 2, 2010, DOHA issued a Statement of Reasons (SOR) to her, pursuant to Executive Order 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended and modified; Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended and modified (Directive); and the Adjudicative Guidelines for Determining Eligibility For Access to Classified Information (December 29, 2005) (AG) applicable to all adjudications and other determinations made under the Directive, effective September 1, 2006. The SOR alleged security concerns under Guideline F (Financial Considerations), and detailed reasons why DOHA could not make a preliminary affirmative finding under the Directive that it is clearly consistent with the national interest to grant or continue a security clearance for Applicant, and recommended referral to an administrative judge to determine whether a clearance should be granted, continued, denied, or revoked.

Applicant acknowledged receipt of the SOR on March 12, 2010. In a sworn statement, dated April 6, 2010, Applicant responded to the SOR allegations and elected to have her case decided on the written record in lieu of a hearing. A complete copy of the Government’s file of relevant material (FORM) was provided to Applicant on November 4, 2010, and she was afforded an opportunity, within a period of 30 days after receipt of the FORM, to file objections and submit material in refutation, extenuation, or mitigation. Applicant received the FORM on September 22, 2010, and elected not to make any additional submissions. The case was assigned to me on January 14, 2011.

FINDINGS OF FACT

In her Answer to the SOR, Applicant admitted nearly all of the factual allegations pertaining to financial considerations (¶¶ 1.a. through 1.h., 1.l., and 1.n. through 1.t.) of the SOR. Those admissions are incorporated herein as findings of fact. She denied the remaining allegations (¶¶ 1.i. through 1.k., and 1.m.) of the SOR.

Applicant is a 33-year-old employee of a defense contractor, currently serving as a “supervisor” with a nationwide communications company, and she is seeking to obtain a security clearance.3 She has never had a security clearance.4 She has not served in the U.S. military.5 Although Applicant considered herself unemployed from August 1990 until December 1999,6 in reality, she was a stay-at-home mom.7 During a portion of that period (from July 1998 until February 1999) she was employed as program aide for a company, and (from February 1999 to December 1999) she was an assistant manager for the same company.8 From December 1999 until May 2001, Applicant was employed as a manager by another company.9 She was unemployed from May 2001 until July 2001.10 From July 2001 until September 2001 she was a nurse assistant,11 and was self-employed as a shop owner from September 2001 until June 2004.12 She was also a factory worker from June 2002 until October 2002.13 Applicant was a part time consultant from June 2004 until December 2005,14 and from December 2005 until January 2007, she was a credit collections specialist.15 In January 2007 she joined another company as a supervisor, and remained there until March 2008.16 It is unclear when Applicant joined her current employer as a supervisor.17

During the period August 2006 until at least May 2008, Applicant was enrolled in an online distance learning program at a technical university where she earned two certificates of achievement.18 Her estimated graduation date was February 2009,19 but there is no evidence that the graduation took place.

Applicant has been in several marital or spouse-like relationships. She was married in April 1990 and had two sons, born in 1990 and 1994, respectively.20 She and her husband were divorced in September 1998.21 She maintained a spouse-like relationship from May 2001 until July 2001, and again from an unspecified point in 2005 until at least April 2008, during which time she was supported by her friend and by child support from her ex-husband.22 She and her friend have one child together.23 She was also in a spouse-like relationship with another friend from June 2005 to October 2005, during which time her boyfriend paid the rent.24 Financial Considerations

It is unclear when Applicant first started to experience financial difficulties. In March 1998, she filed a voluntary petition for bankruptcy under the provisions of Chapter 7 of the U.S. Bankruptcy Code.25 On July 7, 1998, an unspecified number of debts, with unspecified balances, were discharged.26 The identity of the creditors has not been revealed. Applicant contends the debts were those of her husband before their marriage as well as marital debts.27 At some unspecified point after 1998, accounts started to again become delinquent, and some of the accounts were placed for collection with a variety of collection agents, and some of the accounts were charged off. One delinquent account went to judgment. In June 2003, she filed a voluntary petition for bankruptcy under the provisions of Chapter 13 of the U.S. Bankruptcy Code.28 That bankruptcy was dismissed in December 2003.29 It is unclear if Applicant made any payments under the bankruptcy, and the reasons for the dismissal were not specified, although Applicant believes it was because of her 1998 bankruptcy which was only five years earlier.30

On several occasions between 2001 and 2003, Applicant wrote non-sufficient fund (NSF) checks on a joint checking account which she maintained with her friend.31 She subsequently was cited, pled guilty, and was fined for each of the NSF offenses.32 Applicant attributed her actions to her friend’s failure to update the account records to reflect his automated teller machine (ATM) withdrawals, and her lack of awareness that she was issuing bad checks.33

In May 2008, while being interviewed by an investigator from the U.S. Office of Personnel Management (OPM), Applicant acknowledged a number of delinquent accounts for medical bills which arose between 2001 and 2004, during a period when her business was not successful and she had no healthcare insurance.34 She also had a long-standing delinquent utility bill which she claimed to be disputing.35 There was also a long-standing judgment since 2003.36 Applicant professed an intention to contact the creditors of her delinquent medical accounts and the judgment in order to start making payments.37

On several occasions in mid-2008, Applicant wrote credit reporting agencies and collection agencies in efforts to dispute multiple reporting of the same legitimate accounts and seeking validation and verification of various charges.38 As a result, some accounts were removed from Experian and TransUnion credit reports, but they remained on Equifax credit reports. Applicant disputed one account (SOR ¶ 1.a.), with an identified account number, because the SOR alleged the unpaid balance was $127, while one credit report indicated the balance was $120 and a credit report from the following year said it was $127. The basis for her dispute was that she had dental insurance that should have covered the charges and the dollar amount was slightly different.39 She disputed another dental account (SOR ¶ 1.c.) in the amount of $1,705, claiming “multiple inaccuracies,” but did not specify what those inaccuracies were.40 She tried to settle that account but the collection agency did not reply to her dispute.41 Applicant also disputed a 2003 judgment (SOR ¶ 1.l.) in the amount of $5,560, claiming she should not have been liable for charges related to the early termination of a lease for her business, and then added a comment that the judgment no longer appears on one credit report.42 Applicant disputed one account (SOR ¶ 1.n.) pertaining to a repossessed automobile in the amount of $34,029, claiming the debt was too old and it was not legitimate.43 She contended there was unethical conduct by the automobile dealer and stated that her disputes in 2008 resulted in the removal of the adverse listing from TransUnion and Experian credit reports.44 She disputed the account with Equifax in February 2009, and as of December 2009, the adverse entry is no longer listed by Equifax.45 As to the other delinquent accounts that were charged off or which were removed from her credit reports because they were more than seven years old, she has no intention of pursuing those creditors to resolve the delinquent accounts.46 Two of Applicant’s sons attend a cost-free, private, coeducational home and school for children from families of low income, limited resources, and social need.47 In May 2004, she took a one-week overseas vacation to a Caribbean island which she paid for herself.48

The SOR identified 18 continuing delinquencies as reflected by credit reports from 200849 and 2009,50 totaling approximately $44,710. Among the delinquencies are accounts pertaining to medical providers, a repossessed automobile (with a delinquent balance of $34,029), utility service, and credit cards. Some accounts have been transferred, reassigned, or sold to other creditors or collection agents. Other accounts are referenced repeatedly in the different credit reports, in many instances duplicating other accounts listed, either under the same creditor name or under a different creditor name. Some accounts are identified by complete account numbers, while others are identified by partial account numbers, in some instances eliminating the last four digits, and in others eliminating other digits.

Applicant contends she has paid three of the accounts (SOR ¶¶ 1.i., 1.j., and 1.m.) and claims “there are duplicates” for the collection agency regarding SOR ¶ 1.b. However, she has failed to provide documentation to support her contentions or explain which of the other accounts with the one particular collection agency are duplicates. The 2008 combined credit report clearly lists the same accounts separately by credit reporting agency, but Applicant has offered no evidence to support her contention that accounts are listed repeatedly in the SOR. To date, Applicant has produced no evidence to indicate that she has contacted her remaining creditors, established repayment plans, or commenced making any payments.

There is no evidence that Applicant ever received financial counseling covering such topics as debt consolidation, money management, repayment plans, or budgeting, and it is unclear if she ever received any such counseling in conjunction with her 1998 or 2003 bankruptcy filings.

On March 17, 2009, Applicant prepared a personal financial statement,51 indicating a monthly net income, including child support, of $4,550.10;52 $2,545.90 in monthly living expenses;53 and debt payments of $750.01;54 with a monthly net remainder of $1,254.19 available for discretionary spending.55 Applicant also has $24,000 in student loans, deferred until August 2009.56

POLICIES

The U.S. Supreme Court has recognized the substantial discretion of the Executive Branch in regulating access to information pertaining to national security emphasizing, “no one has a ‘right’ to a security clearance.”57 As Commander in Chief, the President has the authority to control access to information bearing on national security and to determine whether an individual is sufficiently trustworthy to have access to such information. The President has authorized the Secretary of Defense or his designee to grant an applicant eligibility for access to classified information “only upon a finding that it is clearly consistent with the national interest to do so.”58

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

An administrative judge need not view tshe guidelines as inflexible, ironclad rules of law. Instead, acknowledging 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. 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 meaningful decision.

In the decision-making process, facts must be established by “substantial evidence.”59 The Government initially has the burden of producing evidence to establish a potentially disqualifying condition under the Directive, and has the burden of establishing controverted facts alleged in the SOR. Once the Government has produced substantial evidence of a disqualifying condition, under Directive ¶ E3.1.15, the applicant has the burden of persuasion to present evidence in refutation, explanation, extenuation or mitigation, sufficient to overcome the doubts raised by the Government’s case. The burden of disproving a mitigating condition never shifts to the Government.60

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 as well. It is because of this special relationship that 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. Decisions include, by necessity, consideration of the possible risk the 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. Furthermore, “security clearance determinations should err, if they must, on the side of denials.”61

Clearance decisions must be “in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.”62 Thus, nothing in this decision should be construed to suggest that I have based this decision, in whole or in part, on any express or implied determination as to Applicant’s allegiance, loyalty, or patriotism. It is merely an indication the Applicant has or has not met the strict guidelines the President and the Secretary of Defense have established for issuing a clearance. 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.

ANALYSIS

Guideline F, Financial Considerations

The security concern relating to the guideline for Financial Considerations 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. . . . The guideline notes several conditions that could raise security concerns. Under AG ¶ 19(a), an Ainability or unwillingness to satisfy debts@ is potentially disqualifying. Similarly, under AG ¶ 19(c), Aa history of not meeting financial obligations@ may raise security concerns.

As noted above, it is unclear when Applicant first started to experience financial difficulties. At some unspecified point, she failed to keep up with her monthly payments, and accounts started to become delinquent. Some accounts were placed for collection and some accounts were charged off. In July 1998, her debts were discharged under Chapter 7 of the U.S. Bankruptcy Code. Five years later, financial problems again arose, when she failed to keep up with her monthly payments, and accounts started to become delinquent. Some accounts were placed for collection and some accounts were charged off. One went to judgment. In June 2003, Applicant filed for bankruptcy under Chapter 13, of the U.S. Bankruptcy Code, but that petition was dismissed in December 2003. As to some of her delinquent accounts, especially those that were charged off or which were removed from her credit reports because they were more than seven years old, Applicant indicated that she has no intention of pursuing those creditors to resolve the delinquent accounts. The record is silent as to why Applicant’s remaining delinquent accounts remained largely unaddressed by her after she secured gainful employment in 2001, and she did not start paying off her delinquent debts. AG ¶¶ 19(a) and 19(c) apply.

The guideline also includes examples of conditions that could mitigate security concerns arising from financial difficulties. Under AG ¶ 20(a), the disqualifying condition may be mitigated where Athe 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.@ Also, under AG ¶ 20(b), financial security concerns may be mitigated where Athe 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.@ Evidence that Athe 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 AG ¶ 20(c). Similarly, AG ¶ 20(d) applies where the evidence shows Athe individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.@63 Also, AG ¶ 20(e) may apply where “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.”

Applicant’s financial problems commenced some time before 1998, and although resolved by a discharge of her debts under Chapter 7 of the U.S. Bankruptcy Code in July 1998, they reappeared some time before 2003, and still have not been resolved. While she attributed some of her continuing financial difficulties initially to her ex- husband’s premarital debts as well as their marital debts, an unsuccessful business venture, and periods of unemployment, she never explained why she failed to resolve or even address nearly all of her delinquent accounts for long periods of time, especially after she became gainfully employed in 2001. Considering her ability to spend money on a Caribbean vacation in 2004, as well as her ownership of a timeshare, it appears that she is unconcerned that her delinquent accounts are still unresolved. Because the financial situation is frequent and continuing in nature, and the continuing causation is not adequately described, AG ¶ 20(a) does not apply. Applicant’s handling of her finances, under the circumstances, casts doubt on her current reliability, trustworthiness, or good judgment.

AG ¶ 20(b) only partially applies because of Applicant’s occasional periods of unemployment, her divorce, and her failed business venture. Applicant had no debts following her 1998 bankruptcy, yet she incurred additional debt which eventually became delinquent. While she claims one lengthy period of unemployment, she was actually a stay-at-home mother. During other periods, she cohabited with her friends and they supported her. Moreover, sufficient time has passed since she generated her bills and obtained employment, and she still has not addressed most of her delinquent accounts, preferring to dispute them or simply wait for them to drop off her credit reports. The reasons stated do not establish she acted “responsibly under the circumstances.”

AG ¶ 20(c) does not apply because there is no clear evidence establishing that Applicant actually received financial counseling.

Applicant receives very limited application of AG ¶ 20(d) because, with few exceptions, she failed to address her delinquent accounts except by disputing them. With a monthly net remainder of $1,254.19 available for discretionary spending, it was possible that Applicant could have commenced the payment of some delinquent accounts. Nevertheless, the vast majority of them remain unpaid or unresolved. She is, instead, waiting for her debts to be removed from her credit reports as they become older than seven years, and she has no intention of pursuing those creditors to resolve the delinquent accounts.64 While there were some indications that she intended to repay some of her delinquent debts eventually, as well as some indications that some debts may have been paid, partially or otherwise, she has offered no documentation to indicate the terms of her repayment agreements, or any indication from the various collection agencies that they have agreed to her proposed terms, or to confirm that such agreements exist or existed. In the absence of such documentation, most of the evidence consists of promises to pay or unsupported contentions that some creditors may have been paid.

AG ¶ 20(e) does not apply because while Applicant has furnished documented proof of her disputed accounts, the basis of her disputes (the credit reports list the same accounts multiple times, or she had health insurance, or she should not be responsible for a broken lease, even though the matter went to judgment) do not address the gravamen of the disputes, to wit, the accounts were not Applicant’s or she has a legal basis not to pay certain accounts.

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(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.

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.

There is some evidence in favor of mitigating Applicant’s conduct. Some of her pre-1998 delinquent accounts were attributed to her ex-husband; she had an unsuccessful business; and she went through periods of unemployment. She also successfully disputed some of her delinquent accounts, causing them to be removed from her credit reports.

The disqualifying evidence under the whole-person concept is substantial. Applicant has a history of financial delinquencies. She failed to address her current financial responsibilities, and simply emphasized her difficult marriage, unsuccessful business, and unemployment to explain her financial difficulties. As noted above, Applicant’s stated intention was to dispute some delinquent accounts because they were listed multiple times in various credit reports, and wait until other delinquent accounts reached the seven-year point and would automatically be removed from her credit reports. Even though she has sufficient funds each month to make substantial payments in an effort to resolve her accounts and the judgment, she has chosen not to do so. A Caribbean vacation and a timeshare are more important. Applicant’s actions reflect traits which raise concerns about her fitness to hold a security clearance. I have evaluated the various aspects of this case in light of the totality of the record evidence and have not merely performed a piecemeal analysis.65 Her limited good-faith efforts are insufficient to mitigate continuing security concerns. See AG ¶ 2(a)(1) through AG ¶ 2(a)(9).

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: Against Applicant Subparagraph 1.f: Against Applicant Subparagraph 1.g: Against Applicant Subparagraph 1.h: Against Applicant Subparagraph 1.i: Against Applicant Subparagraph 1.j: Against Applicant Subparagraph 1.k: Against Applicant Subparagraph 1.l: Against Applicant Subparagraph 1.m: Against Applicant Subparagraph 1.n: Against Applicant Subparagraph 1.o: Against Applicant Subparagraph 1.p: Against Applicant Subparagraph 1.q: Against Applicant Subparagraph 1.r: Against Applicant Subparagraph 1.s: Against Applicant Subparagraph 1.t: Against Applicant

CONCLUSION

In light of all of the circumstances presented by 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.

________________________ ROBERT ROBINSON GALES Administrative Judge

FOOTNOTES

1 Item 4 (SF 86), dated April 17, 2008. 2 Item 7 (Applicant’s Answers to Interrogatories, dated March 23, 2009). 3 Item 7, supra note 2, at 1. 4 Item 4, supra note 1, at 11. 5 Id. at 9. 6 Id. at 5. 7 Item 6 (Personal Subject Interview, dated May 6, 2008), at 1. 8 Item 4, supra note 1, at 5. 9 Id. at 5. 10 Id. at 4. 11 Id. 12 Id. at 3. 13 Id. at 4. 14 Id. at 3. 15 Id. 16 Id. 17 Item 7, supra note 2, at 1. 18 Item, 4, supra note 1, at 2-3. 19 Id. 20 Id. at 6, 8. 21 Id. at 6. 22 Item 6, supra note 7, at 1. 23 Item 4, supra note 1, at 8-9. 24 Item 6, supra note 7, at 1. 25 Item 9 (Internet Download – Bankruptcy Filings, dated February 22, 2010), at 1. 26 Id. 27 Item 6, supra note 7, at 2. 28 Item 10 (Internet Download – Bankruptcy Filings, dated February 22, 2010), at 1. 29 Id. 30 Item 6, supra note 7, at 2. 31 Id. 32 Id. 33 Id. 34 Id. 35 Id. at 2-3. 36 Id. at 3; Item 5 (Combined Experian, TransUnion, Equifax Credit Report, dated April 17, 2008) at 5. 37 Item 6, at 3. 38 Letters to credit reporting agencies and various collection agencies, various dates, attached to Item 7, supra note 2. 39 Dispute Download, undated, attached to Item 7. 40 Dispute Download, dated March 22, 2009, attached to Item 7. 41 Id. 42 Dispute Download, undated, attached to Item 7. 43 Dispute Download, dated February 11, 2009, attached to Item 7. 44 Id. 45 Item 8 (Equifax Credit Report, dated December 15, 2009). 46 Id. 47 Id. at 1. 48 Id. 49 Item 5, supra note 36. 50 Item 8, supra note 45. 51 Personal Financial Statement, dated March 17, 2009, attached to Item 7. 52 Id. It should be noted that Applicant’s friend’s income is not included in the calculation. 53 Id. Applicant’s friend contributes $390 or fifty percent of the rent. 54 Id. Among the debts listed are a timeshare (total balance: $7,700), and four credit card accounts, apparently including some identified in the SOR (¶¶ 1.i. and 1.j.). 55 Id. 56 Id. 57 Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). 58 Exec. Or. 10865, Safeguarding Classified Information within Industry § 2 (Feb. 20, 1960), as amended and modified. 59 “Substantial evidence [is] such relevant evidence as a reasonable mind might accept as adequate to support a conclusion in light of all contrary evidence in the record.” ISCR Case No. 04-11463 at 2 (App. Bd. Aug. 4, 2006) (citing Directive ¶ E3.1.32.1). “Substantial evidence” is “more than a scintilla but less than a preponderance.” See v. Washington Metro. Area Transit Auth., 36 F.3d 375, 380 (4th Cir. 1994). 60 See ISCR Case No. 02-31154 at 5 (App. Bd. Sep. 22, 2005). 61 Egan, 484 U.S. at 531 62 See Exec. Or. 10865 § 7. 63 The Appeal Board has previously explained what constitutes a “good-faith” effort to repay overdue creditors or otherwise resolve debts: In order to qualify for application of [the “good-faith” mitigating condition], an applicant must present evidence showing either a good-faith effort to repay overdue creditors or some other good-faith action aimed at resolving the applicant’s debts. The Directive does not define the term ‘good-faith.’ However, the Board has indicated that the concept of good-faith ‘requires a showing that a person acts in a way that shows reasonableness, prudence, honesty, and adherence to duty or obligation.’ Accordingly, an applicant must do more than merely show that she or she relied on a legally available option (such as bankruptcy [or statute of limitations]) in order to claim the benefit of [the “good-faith” mitigating condition]. (internal citation and footnote omitted) ISCR Case No. 02-30304 at 3 (App. Bd. Apr. 20, 2004) (quoting ISCR Case No. 99-9020 at 5-6 (App. Bd. June 4, 2001)). 64 “Even if Applicant’s financial difficulties initially arose, in whole or in part, due to circumstances outside his [or her] control, the Judge could still consider whether Applicant has since acted in a reasonable manner when dealing with those financial difficulties.” ISCR Case No. 05-11366 at 4 n.9 (App. Bd. Jan. 12, 2007) (citing ISCR Case No. 99-0462 at 4 (App. Bd. May 25, 2000); ISCR Case No. 99-0012 at 4 (App. Bd. Dec. 1, 1999); ISCR Case No. 03- 13096 at 4 (App. Bd. Nov. 29, 2005)). A component is whether he or she maintained contact with creditors and attempted to negotiate partial payments to keep debts current. 65 See U.S. v. Bottone, 365 F.2d 389, 392 (2d Cir. 1966); See also ISCR Case No. 03-22861 at 2-3 (App. Bd. Jun. 2, 2006).