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ISCR Case 09-03045.h1 — CASE

ISCR Case 09-03045.h1denied

Case Headnote

ISCR Case No. 09-03045.h1

deniedMar 25, 2010· Hon. Arthur E. Marshall, Jr.· hearing

Summary

A 44-year-old software technician was denied a security clearance under Guideline F, Financial Considerations, due to approximately $32,800 in delinquent debt. This total included a state tax lien and unresolved state tax issues from 2002 and 2005. The applicant also admitted to owing $488 in medical debt, approximately $29,604 across three student loans, and $1,607 on a credit card account that the company no longer had a record of.

Disqualifying conditions under Guideline F were raised, specifically regarding a history of not meeting financial obligations and an inability or unwillingness to satisfy debts. While the applicant acknowledged his debts and expressed an intent to repay them, he provided no evidence of payments made or attempts to resolve his financial issues.

Despite an applicable mitigating condition that the financial problems were largely due to circumstances beyond his control, such as an erratic employment history, the applicant failed to demonstrate responsible actions to mitigate these concerns. Consequently, the security clearance was denied.

Why the Applicant Was Denied

Applicant admitted to approximately $32,800 in delinquent debt, including a state tax lien and unresolved tax issues.
Applicant provided no evidence of payments made towards his debts or attempts to resolve his financial issues.
The applicant's erratic employment history contributed to his financial difficulties, but he failed to demonstrate responsible actions to mitigate these concerns.

Conditions Referenced

Disqualifying

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

Mitigating

AG ¶ 20(b)appliedConditions That Resulted in the Behavior Were Largely Beyond the Person's Control

Key Rule Quoted

“"Failure or an 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."”

Procedural Posture

SOR issuedOct 28, 2009
Answer filedNov 23, 2009Applicant admitted all allegations.
Hearing held—No hearing; decision based on written record.
Decision dateMar 25, 2010

Cite For

Denial of Security Clearance Due to Unresolved Financial Obligations Under Guideline F
Importance of Providing Evidence of Debt Resolution Efforts
Impact of Erratic Employment History on Financial Stability and Security Clearance Eligibility

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

Standardized Decision Profile

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

Posture: Decision on RecordDecided: denied

The applicant has approximately $32,800 in delinquent debts, including medical debt, credit card debt, a state tax lien, and student loans. The judge found that the applicant failed to provide sufficient evidence of efforts to resolve these debts, leading to a denial of the security clearance under Guideline F.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant admitted he owes approximately $32,800 in delinquent debt, including medical debt of $488. $488	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Applicant admitted he has yet to resolve a state tax issue from 2005.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	Applicant admitted he has three student loans totaling approximately $29,604. $29,604	Against Applicant	Student Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d–1.e	2 sub-charges — specific text not stated in this decision (against the applicant). (low confidence)	Against Applicant			—	—	—
1.f	Applicant admitted he owes $1,607 on a credit card account, which the credit card company no longer has a record of. $1,607	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	Applicant admitted he has yet to resolve a state tax issue from 2002.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	specific text not stated in this decision	Against Applicant	Unspecified Financial	Unknown	—	—	—

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. 09-03045 SSN: ----------- ) ) Applicant for Security Clearance )

For Government: Julie R. Mendez, Esq., Department Counsel For Applicant: Pro Se

March 25, 2010 ______________

STATEMENT OF CASE

______________

MARSHALL, Jr., Arthur E., Administrative Judge:

Applicant signed a security clearance application on January 5, 2009. On October 28, 2009, the Defense Office of Hearings and Appeals (DOHA) issued a Statement of Reasons (SOR) enumerating security concerns arising under Guideline F (Financial Considerations). 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 for SORs issued after September 1, 2006.

In a response dated November 23, 2009, Applicant admitted all eight allegations raised under Guideline F and requested an administrative determination. On January 15, 2010, Department Counsel submitted a File of Relevant Material (FORM), which included seven attached items. Applicant received the FORM on January 15, 2010, but did not submit any additional information for consideration. The case was assigned to me on March 19, 2010. Based on a review of the case file, submissions, and exhibits, I find Applicant failed to meet his burden regarding the security concerns raised. Security clearance denied.

FINDINGS OF FACT

Applicant is a 44-year-old software technician working for a defense contractor. He began working for his present employer in September 2008. He is married and has two young children. He has a high school diploma and a college degree in statistics.

In December 1998, Applicant graduated from college. He worked as a program analyst from April 1999 until about October 2002. He was then unemployed until February 2003. He worked on a farm from February 2003 through March 2005, when he was hired as a support services director. That job lasted until February 2008. He then worked as a handy man until he was hired by his present employer.

In response to the SOR, Applicant admitted the allegations set forth in allegations ¶¶ 1.a through 1.h. Those allegations represent approximately $32,800 in delinquent debt derived from a medical account, a credit card, a state tax lien from 1996, and three student loans. He also admitted he failed to both file a required state tax form for tax year 2005 and resolve a state tax issue involving unemployment benefits received during tax year 2002.

Applicant provided scant information regarding the debts at issue, his employment history, and current finances. He is not living above his means. His medical debt (SOR allegation ¶ 1.a for $488) arose because he has not had medical insurance for over twenty years. His credit card company no longer has a record of his debt (SOR allegation ¶ 1.ffor $1,607), and he is unable to determine which collection agency now owns the debt. He is in continuing negotiations regarding repayment of his educational debt (SOR allegations ¶ 1.c-1.e for about $29,604), which became delinquent due to periods of unemployment, underemployment, and unmanageable payment terms. He is resolving his tax issues (SOR allegations ¶¶ 1.b, 1.g-1.hfor a combined debt of $29,604) as he “recover[s] tax forms from past years. . . .” Regarding his current financial situation, Applicant wrote in response to the October 2009 SOR that he is currently in the process of repaying all of his debts and noted that he intends to repay all of his debts. He stated, “[m]ycurrent working situation affords me benefits that allow me to repay my debts and without proper security clearance I will not be able to continue with my present employer.” As noted above, he has worked for his present employer since September 2008.

When interviewed by investigators in February 2009, Applicant stated that he could meet all of his outstanding financial obligations. In July 2009 interrogatories, he noted that he was “working to resolve all debt issues.” In response to the October 2009 SOR and the January 2010 FORM, however, he provided no documentary evidence of either payments on any of these accounts or attempts to consolidate or otherwise address his debts. Moreover, he provided no evidence demonstrating any attempts to resolve his tax issues. Further, there is no evidence he has received financial counseling to aid him in his efforts.

POLICIES

When evaluating an applicant’s suitability for a security clearance, an administrative judge must consider the revised adjudicative guidelines (AG). In addition to brief introductory explanations for each guideline, the adjudicative guidelines list potentially disqualifying conditions and mitigating conditions. These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, they are applied in conjunction with the factors listed in the adjudicative process. An administrative judge’s over-arching adjudicative goal is a fair, impartial, and commonsense decision. Under AG ¶ 2(c), this process is a conscientious scrutiny of a number of variables known as the “whole person concept.” An 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.

The United States Government (Government) must present evidence to establish controverted facts alleged in the SOR. An applicant is responsible for presenting “witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by applicant or proven by Department Counsel. . . .” The burden of proof is something less than a preponderance of evidence. The ultimate burden of persuasion is on the applicant.

A person seeking access to classified information enters into a fiduciary relationship with the Government based on 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 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.

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.” “The clearly consistent standard indicates that security clearance determinations should err, if they must, on the side of denials.” Any reasonable doubt about whether an applicant should be allowed access to sensitive information must be resolved in favor of protecting such information. A security clearance denial does not necessarily reflect badly on an applicant’s character. It is merely an indication that the applicant has not met the strict guidelines the President and the Secretary of Defense established for issuing a clearance.

ANALYSIS

In this case, Guideline F is the appropriate guideline for consideration. Under that guideline, “failure or an 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.” It also states that “an individual who is financially overextended is at risk of having to engage in illegal acts to generate funds.” Here, Applicant admitted that he owes approximately $32,800 in delinquent debt, including one state tax lien from 1996, and that he has yet to resolve two other state tax issues dating from 2005 and 2002. Therefore, Financial Considerations Disqualifying Condition (FC DC) AG ¶ 19(a) (inability or unwillingness to satisfy debts) and FC DC AG ¶ 19(c) (a history of not meeting financial obligations) apply. With such conditions raised, it is left to Applicant to overcome the case against him and mitigate security concerns.

Applicant’s employment history has been erratic since he graduated from college in 1998. He was unemployed from October 2002 until February 2003, underemployed as a farm worker from February 2003 until March 2005, and underemployed as a handy man from February 2008 until September 2008. At various points during these periods, between 2004 and 2008, he found his student loan payments unwieldy and ceased making payments. In the past year, he repeatedly indicated that he has been working to resolve his debts. Therefore, Financial Considerations Mitigating Condition AG ¶ 20(b) (the conditions that resulted in the behavior 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) applies.

Applicant’s erratic employment and good intentions may mitigate the creation of the debts and issues set forth in the October 28, 2009, SOR. For over a year, however, he has noted his intentions and abilities to honor his obligations, but has yet to produce any documentation reflecting either his efforts or his progress on these issues. Indeed, although he notes in his response to the October 2009 SOR that his current position “affords him benefits that allow” him to “repay his debts,” he provided no evidence that any payments actually have been made. Further, he provided no statement or evidence that he has sought or received financial counseling to help him in his endeavors. Therefore, neither Financial Considerations Mitigating Condition (FC MC) 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), FC MC AG ¶ 20(c) (the person has received or is receiving counseling for the problem and there are clear indications that the problem is being resolved or is under control), nor FC MC AG ¶ 20(d), (the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts) applies.

In declining a hearing and relying on the written record, Applicant limited his ability to address the debts and issues raised in the SOR. The burden for such mitigation in these proceedings is placed squarely on Applicant. Lacking evidence of some progress on either his debts or his tax issues, he failed to mitigate financial considerations security concerns.

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 an 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. As noted above, the ultimate burden of persuasion is on the applicant seeking a security clearance.

I considered the potentially disqualifying and mitigating conditions in light of all the facts and circumstances surrounding this case, as well as the “whole person” factors. Applicant is a mature man who completed his college education in his 30s. Now 44, he recently started a family and has young children. Unfortunately, his employment has been erratic, having suffered through a four-month period of unemployment and two significantly longer periods of underemployment which did not take advantage of his expertise. As a result, debts were acquired and became delinquent.

Applicant was hired for his current position in September 2008. Over the past year, he maintained that he was working on resolving his debts and tax issues. In response to the SOR, he noted that his current position has made it possible for him to repay his debts. Despite these claims, Applicant provided no documentary evidence reflecting such efforts. By failing to meet his burden, financial considerations security concerns remain unmitigated. Clearance denied.

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

Subparagraphs 1.a - 1.h 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 access to classified information. Clearance denied.

ARTHUR E. MARSHALL, JR. Administrative Judge

FOOTNOTES

SOR Response, dated Nov. 23, 2009. FORM, Item 8, Interrogatories, dated Jul 24, 2009, and Investigator’s Notes, dated Feb. 25-28, 2009, at I-9. Id. at I-3.The dates of last activity shown on these accounts occurred between 2004 and 2008. See FORM, Items 6-7, Credit Reports, dated Aug. 28, 2009, and Jan. 23, 2009, respectively. SOR Response, supra, note 1. Id. FORM, Item 8, supra, note 2 at I-3. Id. at I-12. See also ISCR Case No. 94-1075 at 3-4 (App. Bd. Aug. 10, 1995). ISCR Case No. 93-1390 at 7-8 (App. Bd. Jan. 27, 1995). See also EO 12968, § 3.1(b) (listing multiple prerequisites for access to classified or sensitive information), and EO 10865 § 7. ISCR Case No. 93-1390 at 7-8 (App. Bd. Jan. 27, 1995). Id. AG ¶ 18. Id.