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ISCR Case 12-03668.h1 — CASE

ISCR Case 12-03668.h1denied

Case Headnote

ISCR Case No. 12-03668.h1

deniedMar 27, 2014· Hon. Richard A. Cefola· hearing

Summary

A 36-year-old applicant was denied a security clearance under Guideline F, Financial Considerations, due to significant unresolved debts totaling over $39,000. The Statement of Reasons detailed six specific debts, including approximately $31,020 owed on a second mortgage to Creditor A in State A, about $6,258 for a broken lease to Creditor B in State B, and smaller amounts owed to Creditors C, D, E, and F, totaling approximately $878, $1,319, $153, and $1,180 respectively.

The denial was based on the applicant's failure to resolve these past-due debts and a lack of demonstrated good-faith effort to repay or otherwise address them. The judge found that the financial difficulties, which reportedly stemmed from job loss, raised concerns regarding the applicant's reliability and trustworthiness.

Disqualifying conditions F.19.a and F.19.c were cited, indicating a history of not meeting financial obligations and an inability or unwillingness to satisfy debts. Ultimately, the applicant's security clearance was denied.

Why the Applicant Was Denied

Applicant has over $39,000 in past-due debts that he has yet to resolve.
Applicant did not demonstrate a good-faith effort to repay overdue creditors or otherwise resolve debts.
The applicant's financial difficulties raised questions about his reliability and trustworthiness.

Conditions Referenced

Disqualifying

F.19.araisedInability or Unwillingness to Satisfy Debts
F.19.craisedA History of Not Meeting Financial Obligations

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 issuedSep 11, 2013
Answer filedSep 19, 2013
Hearing held—Applicant represented himself
Decision dateMar 27, 2014

Cite For

Denial of Security Clearance Due to Unresolved Financial Obligations
Impact of Financial Difficulties on Reliability Under Guideline F
Failure to Demonstrate 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 F · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The judge found multiple financial concerns under Guideline F, including significant past-due debts totaling over $39,000, which the applicant had not addressed. While one debt was found not owed, the overall financial situation led to a denial of the applicant's security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant is indebted to Creditor A in the amount of about $31,020 on a second mortgage in State A. $31,020	Against Applicant	Mortgage or Home Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Applicant is indebted to Creditor B in the amount of about $6,258 on a broken lease in State B. $6,258	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	Applicant is indebted to Creditor C in the amount of about $878. $878	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	Applicant is indebted to Creditor D in the amount of about $1,319. $1,319	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	Applicant is indebted to Creditor E in the amount of about $153. $153	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	It is alleged that Applicant is indebted to Creditor F in the amount of about $1,180. $1,180	For Applicant	Unspecified Financial	Admitted	—	—	—

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. 12-03668 ) ) Applicant for Security Clearance )

For Government: Caroline H. Heintzleman, Esquire, Department Counsel For Applicant: Pro se

March 27, 2014

______________

STATEMENT OF CASE

______________

CEFOLA, Richard A., Administrative Judge:

Applicant submitted his Electronic Questionnaires for Investigations Processing (e-QIP) on December 20, 2011. On September 11, 2013, the Department of Defense (DOD) issued a Statement of Reasons (SOR) detailing the security concerns under Guideline F 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 after September 1, 2006.

Applicant answered the SOR in writing (Answer) on September 19, 2013, and requested an Administrative Determination by an administrative judge. Department Counsel issued a File of Relevant Material (FORM) on October 23, 2013. Applicant responded to the FORM on or about February 6, 2014, submitting a copy of his Answer and three letters of recommendation. Department Counsel had no objection, and the documents are entered into evidence. Based upon a review of the pleadings and exhibits, eligibility for access to classified information is denied.

FINDINGS OF FACT

In his Answer to the SOR, dated September 19, 2013, Applicant admitted the factual allegations in all the Subparagraphs of the SOR, with explanations.

Guideline F - Financial Considerations

Applicant is 36 years old. (Item 5 at page 5.) In January of 2007, he lost his well paying job in State A. (Item 4 at page 1, and Item 5 at pages 12 and 19.) This loss of employment has caused Applicant’s current financial difficulties.

1.a. Applicant is indebted to Creditor A in the amount of about $31,020 on a second mortgage in State A. (Item 8 at page 3.) He has yet to address this admitted past-due debt; and as such, I find it is still owed. (Answer at pages 1–2.)

1.b. Applicant is indebted to Creditor B in the amount of about $6,258 on a broken lease in State B. (Item 8 at page 1.) He has yet to address this admitted past- due debt; and as such, I find it is still owed. (Answer at pages 2–3.)

1.c. Applicant is indebted to Creditor C in the amount of about $878. (Item 8 at page 2.) He thought his wife had settled this past-due debt, but has offered nothing further of substance in this regard. (Answer at pages 3–4.) I find it is still owed.

1.d. Applicant is indebted to Creditor D in the amount of about $1,319. (Item 10 at pages 6 and 16.) He has yet to address this admitted past-due debt; and as such, I find it is still owed. (Answer at pages 4–5.)

1.e. Applicant is indebted to Creditor E in the amount of about $153. (Item 8 at page 1.) He avers that he believes this dental debt was paid, but has offered nothing further of substance in this regard. (Answer at page 5.) I find it is still owed.

1.f. It is alleged that Applicant is indebted to Creditor F in the amount of about $1,180. In an abundance of caution, he admits this debt, but is “unsure of what this debt might be.” (Answer at page 5.) This alleged debt does not appear on any of the Governments four credit reports. (Items 8–11.) I find this debt is not owed.

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, these guidelines are applied in conjunction with the factors listed in the adjudicative process. (AG Paragraph 2.) The administrative judge’s over-arching adjudicative goal is a fair, impartial and commonsense decision. According to AG Paragraph 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 Paragraph 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.

Under Directive Paragraph E3.1.14, the Government must present evidence to establish controverted facts alleged in the SOR. Under Directive Paragraph 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 as to obtaining 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 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.” 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 Paragraph 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 notes several conditions that could raise security concerns. Under Subparagraph 19(a), an “inability or unwillingness to satisfy debts@ is potentially disqualifying. Similarly under Subparagraph 19(c), “a history of not meeting financial obligations@ may raise security concerns. Applicant has significant past-due debts, which he has not yet resolved.

I can find no countervailing Mitigating Condition that is applicable here. Subparagraph 20(c) requires that “the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.” Applicant has yet, in good faith, to address debts totaling in excess of $39,000. Accordingly, Applicant has not met his burden of persuasion.

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 the circumstances. Under AG Paragraph 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.

The Administrative Judge should also consider the nine adjudicative process factors listed at AG Paragraph 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.

I considered all of the evidence, including the potentially disqualifying and mitigating conditions surrounding this case. Applicant has submitted three letters of recommendation from friends, but the record evidence leaves me with questions and doubts as to his eligibility and suitability for a security clearance. Applicant has over $39,000 in past-due indebtedness that he has yet to resolve. For these reasons, I conclude Applicant has not mitigated the security concerns under the whole-person concept arising from his Financial Considerations.

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

Subparagraph 1.a. Against Applicant Subparagraph 1.b. Against Applicant

Subparagraph 1.c. Against Applicant

Subparagraph 1.d. Against Applicant

Subparagraph 1.e. Against Applicant

Subparagraph 1.f. For 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.

Richard A. Cefola Administrative Judge