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ISCR Case 12-00819.h1 — CASE

ISCR Case 12-00819.h1denied

Case Headnote

ISCR Case No. 12-00819.h1

deniedOct 23, 2013· Hon. Philip S. Howe· hearing

Summary

A 27-year-old tradesman with an eight-year-old son was denied a security clearance under Guideline F (Financial Considerations) due to significant financial delinquencies. The applicant faced concerns stemming from 22 delinquent debts, totaling $18,341, which were detailed in the Statement of Reasons and confirmed by credit reports. These debts included four cell phone accounts, three medical accounts, and various bank and other creditor obligations.

The applicant admitted to all allegations of financial delinquency, attributing his difficulties to a motorcycle accident. However, the decision noted that no payments had been made on any of the 22 unresolved debts, nor had any payment arrangements been established.

Despite the applicant's acknowledgment of the debts, he failed to provide evidence of financial counseling or any concrete efforts to resolve his outstanding financial obligations. Consequently, the adjudicator found that the applicant did not demonstrate responsible action or progress in addressing his financial issues, leading to the denial of his security clearance.

Why the Applicant Was Denied

Applicant admitted all allegations of financial delinquency.
He has 22 unresolved debts totaling $18,341, with no payments made or arrangements established.
Applicant did not provide evidence of financial counseling or efforts to resolve debts.

Conditions Referenced

Disqualifying

F.1.araisedInability or Unwillingness to Satisfy Debts
F.1.craisedA History of Not Meeting Financial Obligations

Mitigating

F.2.brejectedConditions That Resulted in the Financial Problem Were Largely Beyond the Person's ControlApplicant did not demonstrate that his brief unemployment had a substantial effect on his ability to repay 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 issuedMay 16, 2013
Answer filedJun 27, 2013Applicant requested decision on written record.
Hearing held—No hearing; decided on written record.
Decision dateOct 23, 2013

Cite For

Denial of Security Clearance Due to Unresolved Financial Obligations
Failure to Demonstrate Responsible Action Regarding Debts
Lack of Mitigating Circumstances in Financial Considerations

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 22 delinquent debts totaling $18,341, which he admitted were unresolved. The applicant's financial issues were deemed to raise significant security concerns, leading to a decision against his eligibility for a security clearance under Guideline F.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant has 22 delinquent debts listed in the SOR and on his credit reports. They total $18,341. The debts include four cell telephone accounts, three medical accounts, bank debts, and a variety of other creditors seeking payments. $18,341	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. 12-00819 ) ) Applicant for Security Clearance )

For Government: Tovah A. Minster, Esquire, Department Counsel For Applicant: Pro se

10/23/2013 ______________

STATEMENT OF CASE

______________

HOWE, Philip S., Administrative Judge:

On June 12, 2007, Applicant submitted his electronic version of the Security Clearance Application (SF 86) (e-QIP). On May 16, 2013, the Department of Defense issued to Applicant a Statement of Reasons (SOR) detailing security concerns under Guideline F. 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 on September 1, 2006.

Applicant answered the SOR in writing on June 27, 2013. Applicant admitted all the financial allegations in the SOR. Applicant requested his case be decided on the written record in lieu of a hearing. On July 18, 2013, Department Counsel submitted the Department's written case. A complete copy of the file of relevant material (FORM) was provided to the Applicant on July 19, 2013. He was given the opportunity to file objections and submit material in refutation, extenuation, or mitigation. Applicant received the file on July 26, 2013. Applicant did not file a Response to the FORM within the 30 day time allowed that expired on August 25, 2013. I received the case assignment on September 26, 2013. Based upon a review of the pleadings, and exhibits, eligibility for access to classified information is denied.

FINDINGS OF FACT

Applicant admitted all the allegations. (Items 2-6)

Applicant is 27 years old, unmarried and has an eight-year-old son. He pays $181 monthly in child support. He is a tradesman working for a defense contractor. He does not have a high school degree, having departed from school in March 2005. He was working on an alternative educational certificate. Applicant’s employment since June 2005 has consisted of various industrial or retail positions. (Items 4-7)

Applicant has 22 delinquent debts listed in the SOR and on his credit reports. They total $18,341. The debts include four cell telephone accounts, three medical accounts, bank debts, and a variety of other creditors seeking payments. Applicant has not paid any of the debts nor made any arrangements with the creditors for installment payment agreements. Applicant claims his motorcycle accident in April 2011 resulted in his unemployment for several months because of his injuries. Applicant did not provide any documents or information concerning any attempts to resolve his delinquent debts. They are all unresolved. (Items 1-9)

Applicant has not had any financial counseling. He claims in his response to the DOHA interrogatories dated April 3, 2013, that he decided to file Chapter 7 bankruptcy, but did not provide any information concerning his current progress in filing a petition to discharge his delinquent debts. He admits he is overwhelmed with debt. He told the government investigator in when interviewed November 2011 that he was not certain about the origin of many of the debts eventually listed in the SOR. (Items 4, 6, 7)

Applicant did not present any other information, such as employee evaluations, supervisor statements, character statements, or other relevant documents concerning his request for a security clearance.

POLICIES

When evaluating an applicant's suitability for a security clearance, the administrative judge must consider the adjudicative guidelines (AG). In addition to brief introductory explanations for each guideline, the adjudicative guidelines list potentially disqualifying conditions and mitigating conditions, which are useful 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, the administrative judge applies the guidelines 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 Awhole-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[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.

According to Directive & E3.1.14, the Government must present evidence to establish controverted facts alleged in the SOR. Under Directive & E3.1.15, an “applicant is responsible for presenting witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by the applicant or proven by Department Counsel, and has the ultimate burden of persuasion as to obtaining a favorable clearance 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 as to potential, rather than actual, risk of compromise of classified information. See also EO 12968, Section 3.1(b) (listing multiple prerequisites for access to classified or sensitive information).

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 at AG ¶ 19 contains nine disqualifying conditions that could raise security concerns. From these nine conditions, two conditions are applicable to the facts found in this case:

(a) inability or unwillingness to satisfy debts; and

From 2005 to the present, Applicant accumulated 22 delinquent debts, totaling $18,341, which remain unpaid or unresolved. Applicant has taken no action to attempt to pay or resolve any of the delinquent debts.

The guideline in AG ¶ 20 contains six conditions that could mitigate security concerns arising from financial difficulties. Only one mitigating condition might have partial applicability.

(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.

AG ¶ 20 (b) would apply if the loss of employment were shown by Applicant to have a substantial effect on his ability to repay his debts. In the past seven years, Applicant has been unemployed for only a few months in 2011. He did not show he acted responsibly under those circumstances. He failed to meet his burden of proof on that issue.

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.

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.

I considered the potentially disqualifying and mitigating conditions in light of all facts and circumstances surrounding this case. Applicant was an adult when he incurred the debts. He has not taken any action to resolve his delinquent debts. This inaction leaves him vulnerable to pressure, coercion, exploitation, or duress based on the magnitude of his financial obligation. His lack of action continues to this day, and is obviously voluntary. His inaction will continue based on his past performance. Applicant displayed a lack of good judgment incurring the debts. Next, he exhibited a continued lack of appropriate judgment by failing to make payments on any of his delinquent debts during the past seven years.

Overall, the record evidence leaves me with questions or substantial doubts as to Applicant's eligibility and suitability for a security clearance. For all these reasons, I conclude Applicant did not mitigate the security concerns arising under the guideline for Financial Considerations. I conclude the whole-person concept against Applicant.

FORMAL FINDINGS

Formal findings for or against Applicant on the allegations set forth in the SOR, as required by ¶ E3.1.25 of Enclosure 3 of the Directive, are:

Paragraph 1, Guideline F: AGAINST APPLICANT

Subparagraph 1.a to 1.v: 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.

_________________ PHILIP S. HOWE Administrative Judge