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ISCR Case 09-07043.h1 — CASE

ISCR Case 09-07043.h1denied

Case Headnote

ISCR Case No. 09-07043.h1

deniedAug 31, 2010· Hon. John Grattan Metz, Jr.· hearing

Summary

A 28-year-old electrical engineer was denied a security clearance under Guideline F (Financial Considerations) due to significant and ongoing financial difficulties. The applicant had 21 delinquent debts totaling over $32,000, including 15 collection accounts and six charged-off accounts. His financial issues also involved an automobile repossession, which he ignored a court summons for, and a failure to respond to creditor demand letters.

Despite seeking credit counseling in 2002, the applicant opened new credit cards and took no concrete action to resolve his debts. He contacted an attorney about bankruptcy but did not proceed. His financial situation was exacerbated by family obligations, as he became the sole support for his family, whose financial difficulties began in September 1999 due to his father's gambling, his parents' divorce, and his mother's bankruptcy. The applicant also maxed out credit cards paying college expenses and traveled to meet a woman he met online.

The judge concluded that the applicant's financial irresponsibility and lack of mitigation, extenuation, or rehabilitation warranted the denial. The applicant's extensive and ongoing financial difficulties, coupled with his irresponsible use of credit to support his extended family, left him in an untenable financial position.

Why the Applicant Was Denied

Applicant has an extensive history of financial difficulties, which are ongoing.
Applicant has used credit irresponsibly to support his extended family, leading to an untenable financial position.
The record lacks evidence of extenuation, mitigation, or rehabilitation.

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

“The Government has a compelling interest in ensuring each Applicant has the requisite judgement, reliability, and trustworthiness of those who must protect national interests as their own.”
— Department of the Navy v. Egan, 484 U.S. 518 (1988)

Procedural Posture

SOR issuedApr 26, 2010
Answer filed—Applicant requested a decision without hearing.
Hearing held—No hearing was conducted.
Decision dateAug 31, 2010

Cite For

Denial of Security Clearance Due to Ongoing Financial Difficulties Under Guideline F
Failure to Mitigate Financial Concerns Despite a History of Credit Counseling
Impact of Familial Financial Instability on Applicant's Financial Responsibility

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 that the applicant had significant financial difficulties, including 21 delinquent debts totaling over $32,000, and failed to take concrete action to resolve these debts. The applicant's financial irresponsibility and lack of mitigation led to a decision against granting a security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	delinquent debts totaling over $32,000 $32,000	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	15 collection accounts	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	six charged-off accounts	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	automobile repossessed	Against Applicant	Auto Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	ignored a court summons regarding the repossession	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	ignored demand letters from creditors	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	contacted an attorney about filing for bankruptcy but took no action	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	no concrete action to resolve his debts	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	family obligations consume all his income	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.j	Applicant's extended family has had financial difficulties since September 1999	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.k	Applicant's father’s gambling contributed to his financial issues	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.l	Applicant's parents' divorce contributed to his financial issues	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.m	Applicant's mother’s bankruptcy contributed to his financial issues	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.n	Applicant maxed out all his credit cards paying college expenses	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.o	Applicant got credit counseling in 2002 but opened new credit cards	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.p	Applicant became the sole support for his family	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.q	Applicant traveled to meet a woman he met online	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.r	Applicant's financial irresponsibility left him in an untenable financial position	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.s	no evidence of extenuation, mitigation, or rehabilitation	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.t	no information for a whole-person analysis	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.u	Applicant's financial difficulties are ongoing	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—

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

Full decision

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

Decision text, by section

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

APPEARANCES

DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS

In the matter of: ) ) ) ISCR Case No. 09-07043 SSN: ) ) Applicant for Security Clearance )

For Government: James F. Duffy, Esquire, Department Counsel For Applicant: Pro se

August 31, 2010 ______________

STATEMENT OF CASE

______________

METZ, John Grattan, Jr., Administrative Judge:

On 26 April 2010 the Defense Office of Hearings and Appeals (DOHA) issued a Statement of Reasons (SOR) to Applicant listing security concerns under Guideline F, Financial Considerations. Applicant timely answered and requested a decision without hearing. The record in this case closed 18 July 2010, the day Applicant’s response to the government’s File of Relevant Material (FORM) was due. Applicant provided no additional information. DOHA assigned the case to me 11 August 2010.

FINDINGS OF FACT

Applicant admitted the SOR financial allegations. He is a 28-year-old electrical engineer employed by a U.S. defense contractor since July 2007. He has not previously held a clearance. He married in October 2007, and has two small children. His wife does not currently work outside the home.

The SOR alleges, Applicant admits, and government exhibits substantiate, 21 delinquent debts totaling over $32,000. His personal financial statement (PFS)(Item 7) shows $209 positive monthly cash flow. He has taken no concrete action to resolve his debts.

Applicant’s extended family has had financial difficulties since September 1999. His father’s gambling, his parent’s subsequent divorce, and his mother’s bankruptcy all contributed to his entering adulthood already under extreme financial pressure. By 2002, Applicant had maxed out all his credit cards paying his college expenses. In 2002, he got credit counseling, developed a plan for paying off his credit cards, and claims—without documentation—to have made the required plan payments until 2006, when his mother and step-father lost their jobs. However, while he was making plan payments, he was also opening new credit cards. When his parents lost their jobs, Applicant became the sole support for them and his sister. However, this did not stop him from traveling half-way around the world in September 2006 to meet in-person a woman he had met on-line, or making a return trip in September 2007 for an engagement party.

Applicant’s delinquent debts consist of 15 collection accounts and six charged-off accounts. He has had an automobile repossessed and ignored a court summons regarding the repossession, as he has ignored demand letters from his other creditors. He contacted an attorney about filing for bankruptcy, but took no action because he could not afford the fees. Applicant states a desire to pay his delinquent debts when he has the means. Currently, however, his family obligations consume all his income.

POLICIES

The adjudicative guidelines (AG) list factors to be considered in evaluating an Applicant’s suitability for access to classified information. Administrative judges must assess both disqualifying and mitigating conditions under each issue fairly raised by the facts and situation presented. Each decision must also reflect a fair and impartial commonsense consideration of the factors listed in AG ¶ 2(a). The presence or absence of a disqualifying or mitigating condition is not conclusive for or against applicant. However, specific adjudicative guidelines should be followed where a case can be measured against them, as they represent policy guidance governing the grant or denial of access to classified information. Considering the SOR allegations and the evidence as a whole, the relevant adjudicative guideline is Guideline F (Financial Considerations).

Security clearance decisions resolve whether it is clearly consistent with the national interest to grant or continue an applicant’s security clearance. The Government must prove, by substantial evidence, controverted facts alleged in the SOR. If it does, it establishes a valid case against access to classified information. Applicant must then refute, extenuate, or mitigate the government’s case. Because no one has a right to a security clearance, the applicant bears a heavy burden of persuasion.

Persons with access to classified information enter into a fiduciary relationship with the Government based on trust and confidence. Therefore, the Government has a compelling interest in ensuring each Applicant has the requisite judgement, reliability, and trustworthiness of those who must protect national interests as their own. The “clearly consistent with the national interest” standard compels resolution of any reasonable doubt about an Applicant’s suitability for access in favor of the government.2

ANALYSIS

The Government established a case for disqualification under Guideline F, and Applicant did not mitigate the security concerns. Applicant has an extensive history of financial difficulties, which are ongoing. The family Applicant grew up in was not financially stable, and that history followed him into adulthood. Applicant has used credit irresponsibly to support his extended family, and while his motivation may be laudable, his conduct has left him in an untenable financial position. The record contains no other evidence in extenuation, mitigation, or rehabilitation. Consequently, none of the mitigating factors for financial considerations apply. The record further lacks any information upon which to base a “whole-person” analysis. I conclude Guideline F against Applicant.

FORMAL FINDINGS

Paragraph 1. Guideline F: AGAINST APPLICANT

Subparagraphs a-u: Against Applicant

CONCLUSION

In light of all the circumstances presented by the record in this case, it is not clearly consistent with the national interest to grant or continue a security clearance for Applicant. Clearance denied.

JOHN GRATTAN METZ, JR Administrative Judge

FOOTNOTES

DOHA acted under Executive Order 10865, Safeguarding Classified Information within Industry (February 20, 1990), as amended; Department of Defense (DoD) Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines (AG) effective within the DoD on 1 September 2006. See, Department of the Navy v. Egan, 484 U.S. 518 (1988).

¶19 (a) inability or unwillingness to satisfy debts; (c) a history of not meeting financial obligations;