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ISCR Case 10-09695.h1 — CASE

ISCR Case 10-09695.h1denied

Case Headnote

ISCR Case No. 10-09695.h1

deniedNov 30, 2011· Hon. John Grattan Metz, Jr.· hearing

Summary

This case involves a 31-year-old records management specialist whose security clearance application was denied under Guideline F (Financial Considerations) and Guideline E (Personal Conduct). The denial stemmed from a history of financial irresponsibility and an inadequate response to identity theft.

Disqualifying conditions included a pattern of financial difficulties and a failure to address the compromised identity decisively. While the applicant made some efforts to resolve outstanding debts, these actions were not deemed sufficient to mitigate the security concerns.

Despite the application of mitigating conditions related to efforts to resolve debts, the overall assessment concluded that the applicant's financial situation and personal conduct issues remained unmitigated. Consequently, the security clearance was denied.

Why the Applicant Was Denied

The applicant has a history of financial difficulties and irresponsibility.
The applicant failed to act decisively to protect her compromised identity after a theft.
The applicant's progress in addressing debts was insufficient to mitigate security concerns.

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)rejectedConditions That Resulted in the Financial Problem Were Largely Beyond the Person’s ControlThe applicant's failure to act decisively to protect her identity was within her control.
F.20(d)rejectedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant's efforts were deemed insufficient and not timely.
F.20(c)rejectedThe Person Has Received or Is Receiving Counseling for the Problem and There Are Clear Indications That the Problem Is Being Resolved or Is Under ControlThe applicant did not present a budget or continue with credit repair efforts.

Key Rule Quoted

“The Government has a compelling interest in ensuring each applicant possesses 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 issuedJun 13, 2011
Answer filedJul 1, 2011Timely response to SOR.
Hearing heldAug 31, 2011
Decision dateNov 30, 2011

Cite For

Denial of Clearance Due to Financial Irresponsibility Under Guideline F
Failure to Mitigate Identity Theft Issues Impacting Financial Stability
Insufficient Evidence of 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 E (Personal Conduct) · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The judge found that the applicant's personal conduct concerns under Guideline E were not substantiated. The applicant was deemed to have been unaware of her credit issues when completing her clearance application, and her failure to act decisively after her purse was stolen contributed to her financial difficulties. Therefore, the judge resolved Guideline E in favor of the applicant.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a–2.b	2 sub-charges — specific text not stated in this decision (for the applicant).	For Applicant		—		—	—	—

Descriptive standardized rendering of a decided public case (Guideline E). 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. 10–09695 ) Applicant for Security Clearance )

For Government: Raashid S. Williams, Esquire, Department Counsel For Applicant: Pro se

November 30, 2011 ______________

STATEMENT OF CASE

______________

METZ, John Grattan, Jr., Administrative Judge:

Based on the record in this case, Applicant’s clearance is denied.

On 13 June 2011, the Defense Office of Hearings and Appeals (DOHA) sent Applicant a Statement of Reasons (SOR) detailing security concerns under Guideline F, Financial Considerations, and Guideline E, Personal Conduct. Applicant timely answered the SOR, requesting a hearing. DOHA assigned the case to me 4 August 2011, and I convened a hearing 31 August 2011. DOHA received the transcript 8 September 2011.

FINDINGS OF FACT

Applicant admitted SOR allegations 1.a, 1.h, 1.k-1.n, 1.p-1.t, 1.aa, and 1.pp-1.ss. She denied the remaining allegations, including the falsification allegations of SOR 2.a and 2.b. She is a 31-year-old records management specialist employed by a defense contractor since May 2010. She appears to have held a clearance in May 2001, but does not currently have one.

Applicant is the never-married mother of two children, ages four and three months. The record does not show if she receives child support from the other parent.

During summer 2002, Applicant’s purse was stolen. Among the items taken were her social security card, her birth certificate, and her driver’s license. Applicant reported the theft to the police, but never requested a copy of the report. She replaced her birth certificate and driver’s license, but otherwise took no action to protect her identity.

In December 2006, Applicant was subject to a background investigation, which revealed a couple of accounts that she claimed were not hers. She put a fraud alert on her accounts, but otherwise took no action to protect her identity. She did not report the theft of her identity until May 2011. She did not request a new social security number until June 2011.

The SOR alleges, and Government exhibits (GE 2-4) substantiate, 51 delinquent debts totaling nearly $55,000. Applicant admits 16 delinquent debts, totaling over $12,000. She denies the remaining 35 debts claiming she has been the victim of identity theft. She successfully disputed, or otherwise paid, SOR debts 1.m-o ($635 paid after April 2011, w-mm (disputed) and tt-yy (disputed).5

Applicant’s May 2010 clearance application (GE 1) disclosed no delinquent debts. She claims that she was unaware of any delinquent debts until her interview with a Government investigator in June 2010.

Applicant paid SOR debt 1.a ($111) in June 2011 (Answer). She disputed SOR debt 1.b (GE 3) with unknown result. In October and December 2010, she disputed SOR debts 1.c ($2,562) and 1.d ($8,009)(AE C), but the credit bureau validated the debts (AE A). She denied SOR debts 1.e-g, but the debts are not disputed in her May 2011 credit report (GE 3). During her subject interview in June 2010, she did not dispute SOR debts 1.e and 1.g, but was going to look into them. SOR debt 1.fdid not arise until the June 2011 credit report. She admitted SOR 1.h ($469), first claimed it was paid, then disputed the bill (AE B) in June 2011 with unknown result. She settled SOR debt 1.I ($242) for 50% off in June 2011 (Answer). She disputed SOR debt 1.j (16,001) with unknown result. It appears Applicant intended to deny SOR 1.k, but there is no evidence that she disputed this account (GE 3). SOR 1.l ($8,595) is a judgment against Applicant for an automobile accident she was in. She claimed without corroboration to be making payments on the debt, but none of the three credit reports (GE 2, 4; AE A) reflect any payments. SOR debts 1.m-o were paid after April 2011 (GE 4). SOR debt 1.pappears to have been successfully disputed. The debt is listed in the March 2011 credit report (GE 4) , but has been removed from the August 2011 credit report (AE A).

Applicant acknowledges nine traffic tickets (SOR 1.q-u and 1.pp-ss) incurred by her boyfriend, but claims she never got the tickets because her address changed and the tickets were not forwarded. Her own conduct belies this claim. In March 2010, she paid $100 on SOR 1.r ($100), 1.s ($100), and a third ticket not alleged in the SOR, so she knew before she ever completed her clearance application that she had delinquent traffic tickets. In March 2011, she paid $100 on 1.q ($150), 1.r, 1.s, 1.t ($300), and 1.u ($250)(AE C), and paid another $20 on 1.qand $10 on the other four in June 2011 (Answer). In January 2011, Applicant made a $69 payment on SOR 1.rr ($100) and 1.ss ($100) (AE C), and paid another $10 on each ticket in June 2011 (Answer). All told, she has paid $260 on $900 worth of tickets (1.q-u) and another $89 on $200 worth of tickets (1.rr-ss). Two tickets (1.pp-qq) remain unaddressed. Applicant claimed that SOR debts 1.nn and 1.oo were incurred through fraud, but none of the documents confirms that or shows that those accounts were ever disputed.

Applicant provided no budget. She briefly retained a credit repair company in March 2011 and appears to have made one payment in April 2011 on a repayment plan the company designed for her (GE 4). However, she did not continue with the plan. Applicant provided no work or character references. Her August 2011 credit report (AE A) shows two new delinquent debts: another $300 traffic ticket incurred in March 2011 and a nearly $1,500 cable bill in February 2011.

POLICIES

The adjudicative guidelines (AG) list factors for evaluating a person’s suitability for access to classified information. Administrative judges must assess disqualifying and mitigating conditions under each issue fairly raised by the facts and situation presented. Each decision must also reflect a fair, impartial, and commonsense consideration of the factors listed in AG ¶ 2(a). Any one disqualifying or mitigating condition is not, by itself, conclusive. However, specific adjudicative guidelines should be followed where a case can be measured against them, as they represent policy guidance governing 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, the burden shifts to applicant to 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 possesses 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.8

ANALYSIS

The Government established a case for disqualification under Guideline F, and Applicant did not fully mitigate the security concerns. Applicant has a history of financial difficulties and financial irresponsibility going back several years. Although she has made some progress on her debts, that progress is insufficient to overcome the security concerns raised by her financial situation.

The mitigating factors for financial considerations provide considerable help to Applicant, although not enough to fully mitigate the security concerns. Her financial difficulties are both recent and multiple, but the theft of her purse in 2002 is not likely to recur. However, while the theft of her purse was a circumstance beyond her control, her failure act decisively to protect her compromised identity by obtaining a new social security number was well within her control. Waiting until at least 35 fraudulent accounts were opened in her name is grossly irresponsible, and contributed greatly to the financial disarray reflected in her June 2010 credit report. Applicant’s efforts to address her debts have been mixed, although she has largely acted responsibly in addressing her debts. However, she has paid only $349 of the $1,220 she owes on nine outstanding traffic tickets, and nothing since June 2011. She has corroborated no claimed payments on her $8,600 accident judgment. The few small bills she paid were paid in 2011, well after she became aware of them in June 2010, and cannot be considered to have been made timely and in good faith, She has not indicated what she intends to do with the two large debts at SOR 1.cand 1.d, debts that she disputed but that the credit bureau validated. Applicant did not present a budget or stay with her credit repair company. Finally, her August 2011 credit report (AE A) shows two new delinquent accounts, which suggests that Applicant continues to have financial problems. Thus while she may have made substantial progress resolving her debts from her identity theft, she has not established a clear track record that suggests that the financial problems that are hers will not recur. I resolve Guideline F against Applicant. Assessment of the whole-person factors yields no different result.

The Government did not establish a case for disqualification under Guideline E. Applicant credibly states she was unaware of her credit record when she completed the clearance application. Indeed, her blissful unawareness of her credit record, and her failure to act decisively when her purse was stolen were major contributors to her financial disarray. Accordingly, I resolve Guideline E for Applicant.

FORMAL FINDINGS

Paragraph 1. Guideline F: AGAINST APPLICANT

Subparagraphs a–e: Against Applicant Subparagraphs fand v: For Applicant (duplicates and disputed) Subparagraphs g–i: Against Applicant Subparagraph j: For Applicant Subparagraphs k-o: Against Applicant Subparagraph p: For Applicant Subparagraphs q–u: Against Applicant Subparagraphs v-mm: For Applicant Subparagraphs nn-oo: Against Applicant Subparagraphs pp-ss: Against Applicant Subparagraph tt-yy: For Applicant Paragraph 2. Guideline E: FOR APPLICANT

Subparagraphs a-b: For Applicant

CONCLUSION

Under 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

Consisting of the transcript (Tr.), Government’s exhibits (GE) 1-4, and Applicant’s exhibits (AE) A-C. AE C was timely received post-hearing.

DOHA acted under Executive Order 10865, Safeguarding Classified Information Within Industry (February 20, 1960), 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. However, precise correlation of the SOR debts and the Answer debts is not possible because Applicant appears to have lost track at some point which allegation she was answering. For example, she admits SOR 1.p-tas parking tickets that she is paying. However, those five tickets are actually alleged at SOR 1.q-u.

However, debts 1.fand 1.vare the same debt.

Applicant provided independent proof that she successfully disputed SOR debt 1.hh ($252) in June 2011 (Answer) and successfully disputed SOR debt 1.vv ($149) in June 2011 (Answer). It also appears in Applicant’s March 2011 credit report (GE 4), but has been removed from the August 2011 credit report by the same credit bureau (AE A).

Although the debt is listed by two of the three credit bureaus in GE 2, it does not appear in the March 2011 or August 2011 credit reports by the second of those two credit bureaus. Consequently, I conclude that the credit bureau removed it as a fraud account, 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;

¶20(a) the behavior happened so long ago, was so infrequent, or occurred under such circumstances that it is unlikely to recur . . . ¶ 20(b) the conditions that resulted in the financial problem were largely beyond the person’s control . . . and the individual acted responsibly under the circumstances;

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

¶ 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;