CASE · Clearance Adjudication Search EngineCASE

Loading case…

ISCR Case 09-07550.h1 — CASE

ISCR Case 09-07550.h1granted

Case Headnote

ISCR Case No. 09-07550.h1

grantedJul 1, 2009· Hon. Robert J. Tuider· hearing

Summary

A 44-year-old radar technician was granted a security clearance despite concerns under Guideline F (Financial Considerations). The Statement of Reasons alleged that the applicant had accumulated 15 debts totaling $14,510, which had been delinquent for several years. These issues raised disqualifying conditions F.19(a) and F.19(c).

The applicant admitted to all allegations and provided explanations for his financial difficulties. To address these concerns, he retained a debt consolidation firm and demonstrated consistent payments towards his outstanding obligations.

The judge found that the applicant successfully mitigated the security concerns by showing a good-faith effort to resolve his financial obligations. He also maintained a modest lifestyle within his means, satisfying mitigating conditions F.20(b), F.20(c), and F.20(d). Consequently, the security clearance was granted.

Why the Applicant Prevailed

The applicant admitted all allegations and provided explanations for his financial issues.
He retained a debt consolidation firm and made consistent payments towards his debts.
The applicant demonstrated a good-faith effort to resolve his financial obligations and maintained a modest lifestyle.

Conditions Referenced

Disqualifying

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

Mitigating

F.20(b)appliedConditions That Resulted in the Financial Problem Were Largely Beyond the Person’s Control
F.20(c)appliedThe Person Has Received or Is Receiving Counseling for the Problem
F.20(d)appliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve Debts

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.”

Procedural Posture

SOR issuedFeb 18, 2010
Answer filedMar 19, 2010
Hearing heldMay 18, 2010
Decision dateJun 1, 2010

Cite For

Mitigation of Financial Issues Under Guideline F
Good-faith Efforts to Resolve Debts
Impact of Employment Stability on 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: granted

The judge found that the applicant mitigated financial concerns under Guideline F, which included 15 debts totaling $14,510. The applicant demonstrated a commitment to resolving these debts through a debt consolidation firm and maintained a current payment plan, leading to a decision to grant the security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant accumulated 15 debts totaling $14,510 that have been in various states of delinquency for several years. $14,510	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (c) received/receiving counseling; problem being resolved (d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full Documented Payment Plan with Creditor Documented Financial Counseling
1.b–1.p	15 sub-charges — specific text not stated in this decision (for the applicant). (low confidence)	For 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: ) ) XXXXXXXXXX, XXXXX ) ISCR Case No. 09-07550 SSN: XXX-XX-XXXX ) ) Applicant for Security Clearance )

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

August 26, 2010 ______________

STATEMENT OF CASE

______________

TUIDER, Robert J., Administrative Judge:

Applicant has mitigated security concerns pertaining to Guideline F (financial considerations). Clearance is granted.

Statement of the Case

On May 28, 2009, Applicant submitted an Electronic Questionnaire for Investigations Processing (e-QIP). On February 18, 2010, the Defense Office of Hearings and Appeals (DOHA) issued a Statement of Reasons (SOR) detailing security concerns under Guideline F (financial considerations) for Applicant. 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 adjudicative guidelines (AG) effective within the Department of Defense for SORs after September 1, 2006.

Applicant answered the SOR on March 16, 2010, and DOHA received his answer on March 19, 2010. Department Counsel was prepared to proceed on April 21, 2010. The case was assigned to me on April 27, 2010. DOHA issued a notice of hearing on May 3, 2010, scheduling the hearing for May 18, 2010. The hearing was held as scheduled.

The Government offered Government Exhibits (GE) 1 through 6, which were received without objection. The Applicant offered Applicant Exhibits (AE) A through F, which were received without objection, and he testified on his own behalf.

I held the record open until June 1, 2010, to afford the Applicant the opportunity to submit additional documents on his behalf. Applicant timely submitted AE G through O, which were received without objection. DOHA received the hearing transcript (Tr.) on May 25, 2010. The record closed on June 1, 2010.

FINDINGS OF FACT

Applicant admitted all of the SOR allegations with explanations. His admissions are incorporated herein as findings of fact. After a thorough review of the evidence, I make the following additional findings of fact.

Background Information

Applicant is a 44-year-old radar technician, who has worked for his defense contractor employer since June 2009. He seeks a security clearance, which he is required to have as a condition of his continued employment. (GE 1, Tr. 19-21.)

Applicant did not graduate from high school, but was awarded a General Education Development (GED) certificate in approximately September 1997. He also was awarded a trade certificate from a local college after completing a three-month trade course in March 2009. He did not serve in the armed forces. The majority of his working career has been in the electrical field trade, which he learned through on-the- job training. (GE 1, Tr. 25-29.)

Applicant has had an ongoing relationship with his wife, who he married in July 2001. They have three children, a 20-year-old son, a 19-year-old son, and a 17-year- old daughter. His oldest son has moved out of the family home and is employed as a landscaper while the two youngest children are in high school and live at home. Applicant’s wife works part-time as a cashier and prep cook for a pizza restaurant chain. (GE 1, Tr. 21-25, 41-42.)

Financial Considerations

Applicant’s background investigation addressed his financial situation and included the review of his May 2009 e-QIP, his November 2009 and December 2009 DOHA Interrogatories and responses, his July 2009 Department of Public Safety Automated Criminal History report, as well as his June 2009 and January 2010 credit reports. Applicant’s SOR identified a 1992 arrest involving misuse of a former employer’s business credit card and 15 separate debts totaling $14,510. (GE 1 – 6; SOR ¶¶ 1.a. – 1.p.)

In April 2010, Applicant retained the services of a debt consolidation firm (DCF). Applicant enrolled all of his SOR debts with the DCF except for a $98 collection account that he paid off separately in May 2010. (SOR ¶ 1.k.; Tr. 52-53.) Applicant makes monthly payments to the DCF by direct debit and they in turn pay down his debts less their service fee. All of the remaining debts alleged are for medical bills except for a $2,337 collection account owed to a former landlord and a collection account owed to a telephone company for $713. (SOR ¶¶ 1.n., 1.o.; Tr. 49- 50.) Applicant’s first monthly payment to the DCF was $247 with future monthly payments of $189. Applicant’s documentation itemizes the settlement status of each remaining debt. (AE A – AE F, Tr. 37-49.) Applicant’s post-hearing documentation demonstrates that he remains current on his payment plan. (AE G – AE K, AE O.)

The vast majority of Applicant’s debts are for medical bills. Until Applicant secured his present employment, he did not have the benefit of adequate health care coverage or he had no coverage at all. In 2008, he was unemployed for six months. He currently earns an annual salary of $40,944 with full benefit and it is the best job he ever held. In sum, Applicant attributes his financial problems to periods of underemployment, unemployment, and lack of adequate health care coverage. (Tr. 37-40.)

In May 1992, Applicant was arrested following the misuse of his employer’s company credit card. (SOR ¶ 1.p.) He was convicted of theft and sentenced to probation, a fine, community service, and restitution. (GE 6, Tr. 55-57.)

Post-hearing, Applicant submitted documentation that he has participated in financial counseling offered through his DCF. He also submitted a budget that reflects a net monthly remainder of $319 and demonstrates that he maintains a modest lifestyle and is living within his means. (AE L, AE N.) In conclusion, Applicant has paid, settled, or made good-faith efforts to repay or resolve all debts alleged.

Character Evidence

Applicant submitted a reference letter from his manager. His manager stated that Applicant “is a good hard working employee, with a can do attitude, [and] he follows through with diligence and attention to detail.” His manager added that Applicant is progressing at a good rate, comes to work on time, and has been willing to work late to support customer needs and is willing to work overtime. Applicant has received accolades from the program manager and the Government’s contract administrator. (AE M.)

POLICIES

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 adjudicative guidelines list potentially disqualifying conditions and mitigating conditions, which are used 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.

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 in seeking 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 the applicant may deliberately or inadvertently fail to protect or safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation of 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

Upon consideration of all the facts in evidence, and after application of all appropriate legal precepts, factors, and conditions, including those described briefly above, I conclude that a relevant security concern exists under Guideline F (financial considerations). AG ¶ 18 articulates the security concern relating to financial problems:

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.

AG ¶ 19 provides two financial considerations disqualifying conditions that could raise a security concern and may be disqualifying in this case: “(a) inability or unwillingness to satisfy debts,” and “(c) a history of not meeting financial obligations.” Applicant’s history of delinquent debt is established by his admissions and the evidence presented. Applicant accumulated 15 debts totaling $14,510 that have been in various states of delinquency for several years. The Government established the disqualifying conditions in AG ¶¶ 19(a) and 19(c).

Five financial considerations mitigating conditions under AG ¶¶ 20(a) through (e) are potentially applicable:

(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;

(b) 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;

(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;

(d) the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts; and (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.

Applicant’s conduct does not warrant full application of AG ¶ 20(a) because there is more than one delinquent debt and his financial problems are not isolated. Although Applicant has made progress in resolving his debts, the majority of those debts remain unpaid. Therefore, his debt is “a continuing course of conduct.” See ISCR Case No. 07-11814 at 3 (App. Bd. Aug. 29, 2008) (citing ISCR Case No. 01- 03695 (App. Bd. Oct. 16, 2002)). He receives partial credit under AG ¶ 20(a) because the debt “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.”

Applicant receives full credit under AG ¶ 20(b). His debts, which are primarily for medical bills, arose at a time when Applicant was without adequate health insurance or no health insurance because he was either underemployed or unemployed. Applicant attempted to remain current on his debts to the best of his ability, but did not have the necessary funds. Now that Applicant has a decent paying job with benefits, he has taken the necessary corrective action to address his debts.1

AG ¶ 20(c) is applicable because Applicant sought financial counseling through his DCF. He has produced evidence that establishes that he is living within his means and regained his financial responsibility. Furthermore, there is sufficient information to establish full mitigation under AG ¶ 20(d).2 Applicant has paid, is paying, or has otherwise resolved his debts. AG ¶ 20(e) is not applicable because Applicant did not dispute the legitimacy of any of his debts. His 1992 arrest lacks security significance both because of the passage of time, and because he has fully complied with his court imposed sentence.

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 relevant 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.

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. AG ¶ 2(c).

There is evidence against mitigating Applicant’s conduct. The SOR lists 15 debts totalling $14,510 that have been in various states of delinquency for several years. He failed to keep his accounts current, showing financial irresponsibility and lack of judgment. This fact alone raises sufficient security concerns to merit further inquiry.

The mitigating evidence under the whole-person concept is more substantial. Applicant’s record of good employment weighs in his favor. He is a law-abiding citizen. He has made a good-faith effort to pay or resolve his SOR debts. Recognizing that he needed to get his financial house in order, he retained the services of a DCF in April 2010. His monthly expenses are current. The Appeal Board has addressed a key element in the whole-person analysis in financial cases, stating:

In evaluating Guideline F cases, the Board has previously noted that the concept of “‘meaningful track record’” necessarily includes evidence of actual debt reduction through payment of debts.” However, an applicant is not required, as a matter of law, to establish that he has paid off each and every debt listed in the SOR. All that is required is that an applicant demonstrate that he has “. . . established a plan to resolve his financial problems and taken significant actions to implement that plan.” The Judge can reasonably consider the entirety of an applicant’s financial situation and his actions in evaluating the extent to which that applicant’s plan for the reduction of his outstanding indebtedness is credible and realistic. See Directive ¶ E2.2(a) (“Available, reliable information about the person, past and present, favorable and unfavorable, should be considered in reaching a determination.”) There is no requirement that a plan provide for payments on all outstanding debts simultaneously. Rather, a reasonable plan (and concomitant conduct) may provide for the payment of such debts one at a time. Likewise, there is no requirement that the first debts actually paid in furtherance of a reasonable debt plan be the ones listed in the SOR.

ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008) (internal citations omitted). Applicant is making a contribution to the national defense. His company fully supports him and recommends him for a security clearance. He made mistakes, and debts became delinquent. There is, however, simply no reason not to trust him. He has paid his debts or is paying down his debts. Furthermore, he has established a “meaningful track record” of debt payments. These factors show responsibility, rehabilitation, and mitigation. After weighing the disqualifying and mitigating conditions, and all the facts and circumstances in the context of the whole person, I conclude he has mitigated the financial considerations security concerns.

I take this position based on the law, as set forth in Department of Navy v. Egan, 484 U.S. 518 (1988), my careful consideration of the whole-person factors and supporting evidence, my application of the pertinent factors under the adjudicative process, and my interpretation of my responsibilities under the adjudicative guidelines. Applicant has fully mitigated or overcome the Government’s case. For the reasons stated, I conclude he is eligible for access to classified information.

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: FOR APPLICANT Subparagraphs 1.a. to 1.p.: For Applicant

CONCLUSION

In light of all the circumstances presented by the record in this case, it is clearly consistent with the national interest to grant or continue Applicant’s eligibility for a security clearance. Eligibility for a security clearance is granted.

____________________________ Robert J. Tuider Administrative Judge

FOOTNOTES

1 “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 maintained contact with his creditors and attempted to negotiate partial payments to keep his debts current.

2 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 he or she relied on a legally available option 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)).