CASE · Clearance Adjudication Search EngineCASE

Loading case…

ISCR Case 12-06718.h1 — CASE

ISCR Case 12-06718.h1granted

Case Headnote

ISCR Case No. 12-06718.h1

grantedJun 30, 2014· Hon. Elizabeth M. Matchinski· hearing

Summary

A 54-year-old inspector with nearly three decades in the defense industry was granted a security clearance despite concerns under Guideline F, Financial Considerations. The primary issue involved approximately $9,324 in delinquent consumer debt that arose after a Chapter 7 bankruptcy discharge in April 2009. Disqualifying conditions AG ¶ 19(a) and AG ¶ 19(c) were initially raised due to these financial obligations.

However, the judge applied mitigating conditions AG ¶ 20(a), AG ¶ 20(b), and AG ¶ 20(e). It was determined that the applicant had a reasonable basis to dispute the legitimacy of several past-due debts. Crucially, the financial difficulties were largely attributed to circumstances beyond her control, specifically a marital separation.

The applicant's long history of stable employment in the defense industry and her consistent, timely payments on current debts further supported the decision. Ultimately, these factors led to the security clearance being granted.

Why the Applicant Prevailed

The applicant demonstrated a reasonable basis to dispute the legitimacy of several past-due debts.
The financial issues were largely due to circumstances beyond the applicant's control, specifically a marital separation.
The applicant has a long history of stable employment in the defense industry and has made timely payments on current debts.

Conditions Referenced

Disqualifying

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

Mitigating

AG ¶ 20(a)appliedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Circumstances That It Is Unlikely to Recur
AG ¶ 20(b)appliedConditions That Resulted in the Financial Problem Were Largely Beyond the Person’s Control
AG ¶ 20(e)appliedThe Individual Has a Reasonable Basis to Dispute the Legitimacy of the Past-due Debt

Key Rule Quoted

“The protection of the national security is the paramount consideration.”

Procedural Posture

SOR issuedNov 6, 2013
Answer filedUndated response submitted
Hearing heldJun 4, 2014Hearing was scheduled after delays due to travel and budget considerations.
Decision dateJun 30, 2014

Cite For

Mitigating Conditions Related to Financial Difficulties Due to Marital Separation
Disputing the Legitimacy of Debts Under Guideline F
Consideration of Long-term Employment History in Security Clearance Decisions

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 had a significant amount of delinquent debt totaling approximately $43,473, primarily due to a Chapter 7 bankruptcy discharge in April 2009. However, the judge determined that several mitigating conditions applied, leading to a decision in favor of the applicant on all financial allegations under Guideline F.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a–1.k	11 sub-charges — specific text not stated in this decision (for the applicant).	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: ) ) ) ISCR Case No. 12-06718 ) Applicant for Security Clearance )

For Government: Stephanie C. Hess, Esq., Department Counsel For Applicant: Pro se

06/30/2014 ______________

STATEMENT OF CASE

______________

MATCHINSKI, Elizabeth M., Administrative Judge:

Applicant has worked in the defense industry for almost 30 years as an inspector. She owes about $9,324 in delinquent consumer debt after an April 2009 Chapter 7 bankruptcy discharge. The debt was incurred largely because of a marital separation. Applicant is making payments on her student loans, and she lives within her means. Clearance is granted.

Statement of the Case

On November 6, 2013, the Department of Defense Consolidated Adjudications Facility (DOD CAF) issued a Statement of Reasons (SOR) to Applicant, detailing the security concerns under Guideline F, Financial Considerations, and explaining why it was unable to find it clearly consistent with the national interest to grant or continue security clearance eligibility for her. The DOD CAF took the action 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 September 1, 2006. Applicant submitted an undated response to the SOR allegations. On December 19, 2013, she requested a hearing before an administrative judge from the Defense Office of Hearings and Appeals (DOHA). By letter dated March 5, 2014, Department Counsel provided discovery of the potential Government exhibits (GEs) to Applicant. On March 12, 2014, the case was assigned to me to conduct a hearing to determine whether it is clearly consistent with the national interest to grant or continue a security clearance for her. Scheduling the hearing was delayed because of travel and budget considerations for the Government. On May 12, 2014, I scheduled a hearing for June 4, 2014.

I convened the hearing as scheduled. Four Government exhibits (GEs 1-4) and two Applicant exhibits (AEs A-B) were admitted into evidence without objection. Applicant testified, as reflected in a transcript (Tr.) received on June 16, 2014.

Summary of SOR Allegations

The SOR alleges under Guideline F that as of November 6, 2013, Applicant owed $43,473 in delinquent debt (SOR 1.a-1.j): $10,730 was for utility service (SOR 1.a-1.e) and $32,743 was consumer credit debt (SOR 1.f-1.j). The SOR also alleges that Applicant was granted a Chapter 7 discharge in bankruptcy in April 2009 (SOR 1.k). When she answered the SOR allegations, Applicant denied two of the four natural gas debts alleged (SOR 1.a and 1.b), a propane account debt (SOR 1.e), the consumer credit debts (SOR 1.f -1.j), and the bankruptcy discharge (SOR 1.k.). However, Applicant also indicated that the assignee in SOR 1.hwas collecting the debt in SOR 1.g, raising a reasonable inference that SOR 1.gand 1.hare the same debt.

FINDINGS OF FACT

After considering the pleadings, exhibits, and transcript, I make the following findings of fact.

Applicant is a 54-year-old inspector, who has worked for her current defense contractor employer since December 2003. She holds a Secret clearance, which was granted to her around December 2004. (GE 1; Tr. 23.)

Applicant has two grown children, who are now age 35 and 34. She started her employment in the defense industry as an assembler/inspector with a defense contractor in October 1982. She was granted a DOD Confidential security clearance for her duties. (GE 1; Tr. 24.)

In April 2002, Applicant was laid off from her employment due to a lack of work. (GE 1.) With almost 20 years on the job, she had been earning $26 an hour. (Tr. 50.) She was unemployed until July 2002, when she began working full time, at the prevailing minimum wage, as a charge-back analyst for a credit card company. In October 2002, Applicant took on a second job as a cashier with a retailer at minimum wage. (GE 1; Tr. 50.) She resigned from those jobs for her current employment. (GE 1.) Applicant’s starting wage with the defense contractor was between $16 and $17 an hour. (Tr. 50.)

Applicant owned her home, a condominium which she purchased in 2001. Available credit report information shows that she paid off a $109,250 mortgage in October 2001, and that she continued to make payments as agreed on a $68,720 installment loan. In August 2003, she took on a new mortgage of $98,000. (GEs 3, 4.)

Applicant fell behind on a consumer credit account (SOR 1.i) in late 2006. She continued to make her payments on other consumer credit accounts, including her mortgage. (GE 4.) In 2007, Applicant began taking online courses in criminal justice through a technical institute. (Tr. 51.) Available credit reports show that she took out student loan debt of $30,111.1 (GEs 3, 4.)

Applicant and her spouse separated around May 2008, after she filed for a restraining order against him. Applicant filed for divorce.2 (GEs 1, 2.) Applicant stopped paying on a consumer credit account in January 2008 (SOR 1.f); on the credit card account in SOR 1.jin June 2008; and on her mortgage in August 2008. (GE 4.) Applicant paid her divorce attorney approximately $7,000 between 2008 and 2010 because of the protracted nature of her divorce proceedings. (GE 2.) She eventually terminated her divorce attorney’s services because she could not afford to pay him. (Tr. 22-26.)

In December 2008, Applicant filed for a Chapter 7 bankruptcy discharge.3 She listed two secured claims: the $96,544.10 mortgage balance on her condominium and $2,000 in unpaid condominium dues. She listed non-priority, Schedule F claims totaling $36,191.66: $2,133.20 in attorney fees for her divorce; $969.72 in electric utility debt for her condominium; a $16,904.42 balance on the account in SOR 1.i; and five credit card debts, including the debts in SOR 1.fand 1.j.4 (GE 1; AE B.) Applicant obtained credit counseling before she filed for her bankruptcy. She also took an online debtor education course after she filed. (AE A; Tr. 27.) In April 2009, she was granted a bankruptcy discharge. (GE 4.) In August 2009, a propane company placed a $306 debt for collection. (GE 3.)

On October 29, 2009, Applicant completed and certified to the accuracy of an Electronic Questionnaire for Investigations Processing (e-QIP). In response to the financial record inquiries, Applicant reported that a loan and four credit card debts had been discharged in a Chapter 7 bankruptcy. She also disclosed that condominium had gone into foreclosure. (GE 1.)

On February 1, 2010, Applicant was interviewed by an authorized investigator for the Office of Personnel Management (OPM). Applicant discussed her bankruptcy, which she indicated covered all her debts, including her mortgage, condominium association dues, divorce attorney fees, the natural gas debt, an electric utility debt of $969.72, and her credit card debts. Applicant explained that she had to file for bankruptcy after she and her spouse separated in May 2008, and that most of the credit card debt was for her attorney fees. Applicant added that she was not certain about the status of her divorce. She had not contacted her divorce attorney in some time because she could not pay him, but she planned to contact him within the next week. About the foreclosure, which was initiated while she was in bankruptcy, Applicant indicated that she had tried without success to sell or lease her condominium. Applicant moved to her current state of residency in February 2009, and the mortgage was dealt with through the bankruptcy. Applicant reported monthly net income after deductions of $2,440, monthly expenses of $1,800, and $100 in debt payments on her student loans. Applicant admitted that she was past due in her student loan payments, but she had a negotiated payment plan with her lender. (GE 2.)

On February 9, 2010, the investigator asked Applicant about delinquency dates for the accounts covered in her bankruptcy. She indicated that all the accounts except the mortgage went past due about five or six months before she filed. Applicant claimed that she stopped paying her mortgage when she filed for bankruptcy in December 2008. (GE 2.)

As of June 11, 2011, the credit bureaus were reporting that her mortgage had been included in the bankruptcy, but also that her mortgage lender had redeemed the home to settle her mortgage. Applicant was 30 days late ($351 past due) on a $7,206 credit card balance (SOR 1.g). The account was opened in February 2011 and had a $7,000 credit limit. She reportedly owed a $306 balance on a propane debt in collection since April 2009,5 although the credit report also indicated that the debt had been discharged. Applicant’s student loans were current, but they had been delinquent 150 days in the past. (GE 4.)

In September 2011, a natural gas provider placed two debts, of $1,672 and $1,154 from July 2011, for collection. (GE 3.) Applicant had two separate accounts for gas service because she had a two-floor apartment with separate service for each floor. (Tr. 31-32.) As of February 2013, the accounts had respective outstanding balances of $2,474 (SOR 1.a and 1.c, same debt) and $2,211 (SOR 1.band 1.d, same debt). (GE 3.) Applicant was billed for those balances, but she made no payments. (Tr. 32.) In April 2013, the gas company placed updated balances of $2,908 and $2,831 for collection. (GE 3.) As of September 2013, Applicant had made no payments toward the delinquent natural gas debts or the $306 propane debt (SOR 1.e). She had not received any bills for the updated balances of the natural gas debts (Tr. 32-33), although by then, she had moved from the residence where those costs were incurred. (GE 2.) The credit card account in SOR 1.ghad been charged off and sold to the assignee in SOR 1.h. The debt was in collection with a reported balance of $3,279.6 Applicant was making payments on two accounts opened to rehabilitate her credit. She was paying $450 per month on a $21,811 automobile loan opened in August 2012, and about $25 per month on a low-limit ($500) credit card account with a $518 balance. Both accounts were current as of August 2013, but they had been past due 30 days in June 2013. Applicant was reportedly paying $100 a month toward her student loans, which had an aggregate balance of $19,995. She was behind $400 on one student loan account and $109 on another. (GE 3.)

In interrogatories dated September 10, 2013, the DOD CAF asked Applicant to update the payment status, if any, on the debts alleged in the SOR. On October 8, 2013, Applicant indicated that she owed only two of the four alleged natural gas debts; that the propane (SOR 1.e) and three of the consumer credit debts (SOR 1.f, 1.i, and 1.j) had been discharged in her bankruptcy; and that the $7,000 credit card debt in SOR 1.gwas the same debt as the $3,279 collection debt in SOR 1.h. Applicant explained that she had reached a settlement with the assignee in SOR 1.hand had made payments on the debt before she could no longer afford to do so. She expressed her intent to consolidate her collection debt and her school loans so that she could make one, affordable monthly payment. Concerning any circumstances which could aid the DOD CAF to determine whether it is clearly consistent with the national interest to grant her a security clearance, Applicant cited her defense contractor employment for about 30 years, and she attributed her financial issues to her efforts to divorce her husband. She admitted that she was “still trying to get [her] finances straight.” At the request of the DOD CAF, Applicant completed a personal financial statement showing that her monthly expenses and debt payments ($450 car payment and $65 toward her low-limit credit card) exceeded her net income by $18. She reported no assets other than her vehicle. (GE 2.)

Applicant’s hourly wage is presently $19. (Tr. 50.) She rents an in-law apartment from her father, and she pays her rent on time. (Tr. 43, 49.) Her father covers the utility costs. (Tr. 49.) She has about $100 in discretionary funds after she pays her monthly bills. Her student loan payment, of $50 a week as of June 2014, is being automatically deducted from her checking account. (Tr. 41, 45.) Applicant’s student loan balance is between $19,000 and $20,000 because of accrued interest on the unpaid principal. (Tr. 45.) The balance of her only open credit card account is about $400. (Tr. 42.)

As of early June 2014, Applicant had made no payments on her outstanding past- due debt (SOR 1.a, 1.d, 1.e, and 1.h). Applicant tried to borrow from her 401(k) account to pay her natural gas debts, in collection, but she was denied. (Tr. 48.) She plans to arrange repayment terms on those debts as soon as she has her student loans straightened out. (Tr. 44.) She has one new delinquency, a medical debt of $100, which is in collection. (Tr. 37, 40.) Applicant testified, with no evidence to the contrary, that she has never received any complaints at work or violated her security responsibilities. She has minimal access to “top security” material. (Tr. 29.)

POLICIES

The U.S. Supreme Court has recognized the substantial discretion the Executive Branch has in regulating access to information pertaining to national security, emphasizing that “no one has a ‘right’ to a security clearance.” Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). When evaluating an applicant’s suitability for a security clearance, the administrative judge must consider the adjudicative guidelines. In addition to brief introductory explanations for each guideline, the adjudicative guidelines list potentially disqualifying conditions and mitigating conditions, which are required to be considered 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 overall 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 to obtain 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 that the applicant may deliberately or inadvertently fail to safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation about 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 about financial considerations is set forth 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 SOR identified 10 purportedly delinquent accounts, totaling $43,473 in outstanding debt, after Applicant was granted a Chapter 7 bankruptcy discharge in April 2009. Available bankruptcy records show that the consumer credit debts in SOR 1.i and 1.j, $18,242 of the total debt, were included in her bankruptcy. Applicant submits that the credit card debt of $4,231 alleged in SOR 1.fwas discharged as well. The creditor was not named in her bankruptcy. However, the account was charged off and sold in 2008, and her bankruptcy included a $5,576 credit card debt not listed on her credit reports. Applicant could not confirm that the lender named in her bankruptcy purchased the debt in SOR 1.f. Even so, she did not owe an outstanding balance to the creditor in SOR 1.fas of the SOR.

A propane debt of $306 (SOR 1.e) was placed for collection in May 2009. Applicant claims she included the debt in her bankruptcy, and her June 2011 credit report (GE 4) shows the debt as included. However, the debt was not listed on either her Schedule D or her Schedule F (AE B.) The debt appears on her credit record as an outstanding collection account as of November 2009, after her bankruptcy discharge. Applicant admits that she allowed two natural gas accounts to become seriously delinquent in 2011. As of June 2013, collection balances on the two accounts totaled $5,739 (SOR 1.a and 1.b, duplicated in SOR 1.cand 1.d). The evidence establishes that as of June 2011, Applicant was past- due $351 and $206 over her credit limit of $7,000 on the credit card account in SOR 1.g. The account was subsequently charged off and transferred or sold to the collection agency identified in SOR 1.h. As of August 2013, the unpaid balance was $3,279. AG ¶ 19(a), “inability or unwillingness to satisfy debts,” and AG ¶ 19(c), “a history of not meeting financial obligations,” are established by Applicant’s record of financial delinquency.

Yet, several mitigating conditions apply, either in whole or in part. AG ¶ 20(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,” is satisfied as to the debts alleged in SOR 1.c-1.d, 1.f-1.g, and 1.i-1.j. The debts in SOR 1.cand 1.dare previous balances of the collection debts in SOR 1.a and 1.band do not represent additional balances. The credit card debt in SOR 1.fwas charged off and sold. It is legally uncollectible, even assuming it was not included in her bankruptcy. The credit card debt in SOR 1.gwas transferred to the collection agency in SOR 1.h, and the debts in SOR 1.i and 1.jwere discharged in her bankruptcy. AG ¶ 20(e) does not apply to the delinquencies which were owed as of the SOR and are still unpaid (SOR 1.a, 1.b, 1.e, and 1.h).

AG ¶ 20(a), “the behavior happened so long ago, was so infrequent, or occurred under circumstances that it is unlikely to recur and does not cast doubt on the individual’s current, reliability, or good judgment,” applies in that the debts are not recent. The credit card debts in SOR 1.f, 1.i, and 1.jwere incurred between 2006 and 2008, and they were either charged off or discharged in her December 2008 bankruptcy. The natural gas (SOR 1.a and 1.b) and propane (SOR 1.e) debts were incurred about five years ago. Those debts, as well as the credit card debt in collection (SOR 1.h) remain unpaid, but the debts are attributable to her pending divorce and not to circumstances that reflect adversely on her judgment and reliability.

Marital separation and divorce are mitigating conditions that could trigger AG ¶ 20(b):

(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.

Applicant’s June 2011 credit report shows that Applicant paid several consumer credit accounts on time, including the mortgage on her condominium, before she and her spouse separated in May 2008. A few accounts were shown to be delinquent before her separation: a $995 consumer credit debt (not alleged) with a last payment in December 2007 and included in her bankruptcy; the account in SOR 1.f, which was transferred after no payment since January 2008; and the account in SOR 1.i, with November 2006 as the date of both account opening and last activity. However, her separation and divorce filing had a negative impact on her finances in that she paid her divorce attorney around $7,000 before she terminated his representation because she could not afford to pay him. These unexpected costs implicate AG ¶ 20(b). Loss of spousal income could be a factor under AG ¶ 20(b), but Applicant did not present any evidence in this regard.

For AG ¶ 20(b) to fully apply, Applicant must show that she acted reasonably under the circumstances. While Applicant did not provide any details about her marriage, a restraining order suggests an abusive relationship. Since May 2008, Applicant has had to support herself on an hourly wage between $17 and $19 an hour. When she had no success in selling or renting out her condominium, she turned to bankruptcy. While the effect of her Chapter 7 discharge was to leave most of her creditors without a legal remedy (her mortgage lender apparently redeemed her property), bankruptcy is a legal means to address her debts. She indicated in response to the interrogatories that she had reached a settlement with the agency collecting SOR 1.h, and that she had made some payments until she moved and could no longer afford to do so. Her September 2013 credit report shows September 2011 as the date of last activity on the account. She tried to obtain a loan from her 401(k) to address her $5,739 in natural gas debts. Applicant does not have repayment arrangements in place for the debts in SOR 1.a, 1.b, 1.e, or 1.h, but she is paying on her student loans. She is being responsible, given her circumstances. AG ¶ 20(b) applies.

AG ¶ 20(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,” and AG ¶ 20(d), “the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts,” are both implicated. Applicant received financial counseling as required for her bankruptcy discharge. A Chapter 7 bankruptcy is not a substitute for payments, but it is understandable in her circumstances. Her candor about her financial delinquencies and her bankruptcy on her e-QIP enable me to accept her uncorroborated testimony that she tried in good faith to obtain a loan from her 401(k) to resolve her delinquent natural gas debts. Yet, it is difficult to fully apply either AG ¶ 20(c) or AG ¶ 20(d) without recent efforts by her to settle or satisfy her outstanding delinquencies (SOR 1.a, 1.b, 1.e, and 1.h).

WHOLE PERSON CONCEPT

Under the whole-person concept, the administrative judge must consider the totality of an applicant’s conduct and all relevant circumstances in light of the nine adjudicative process factors in AG ¶ 2(a).7

Applicant’s financial difficulties are attributed to the dissolution of her marriage and not to excessive spending. Her largest debt is for student loans, which she took out in 2007 to pay for online studies. When she and her spouse separated, she had the burden of repaying about $30,000 in student loan debt and a $96,544 mortgage on an hourly wage that was between $17 and $19 an hour. She ran up consumer credit balances paying for her divorce attorney without procuring a final decree of divorce because her spouse gave her “a hard time.” (Tr. 22.) After a bankruptcy discharge and transfers of some debts, Applicant still owes delinquent debt balances totaling about $9,324.

In making the whole-person assessment required under the Directive, the DOHA Appeal Board has held that an applicant is not required, as a matter of law, to establish resolution of every debt alleged in the SOR. An applicant need only establish a plan to resolve financial problems and take significant actions to implement the plan. See ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008). Applicant testified credibly to her intent to arrange settlements or repayment of the natural gas debts ($5,739 of the $9,324 total) as soon as she has her student loans straightened out. (Tr. 44.) Albeit 150 days behind in her student loans at one point, she made payments to reduce her student loan debt to $19,995 as of September 2013. As of June 2014, she was paying $50 a week toward her student loans. Applicant plans to consolidate them to lower the interest paid on the accounts.

Certainly, Applicant would have a better case in mitigation had she repayment plans in place for her $9,324 in old delinquent debt. In her favor, she lives within her means and is handling her current obligations responsibly. For the most part, she has paid her car loan, rent, and credit card balance on time. Her student loan payments are being automatically withdrawn from her checking account. On her present hourly wage of $19, she has at most $100 in discretionary income at the end of the month, so the prospect of resolving her past-due debts in the near future is low, unless she is able to borrow the funds or manages to reduce her monthly student loan payment obligation. She has worked in the defense industry for almost 30 years, the past ten with her current employer, with no evidence of any security violations. Security clearance decisions are not intended as punishment for past shortcomings. Nor do they demand perfection. Applicant is not seen as likely to jeopardize the employment which she needs to maintain to be able to meet her present financial obligations and to address less than $10,000 in past-due debt. After reviewing the facts and circumstances before me, I conclude that it is clearly consistent with the national interest to continue Applicant’s security clearance eligibility at this time.

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

Subparagraph 1.a: For Applicant Subparagraph 1.b: For Applicant Subparagraph 1.c: For Applicant Subparagraph 1.d: For Applicant Subparagraph 1.e: For Applicant Subparagraph 1.f: For Applicant Subparagraph 1.g: For Applicant Subparagraph 1.h: For Applicant Subparagraph 1.i: For Applicant Subparagraph 1.j: For Applicant Subparagraph 1.k: For Applicant

CONCLUSION

In light of all of 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 access to classified information is granted.

___________________ Elizabeth M. Matchinski Administrative Judge

FOOTNOTES

1 A credit report of June 11, 2011, shows Applicant opened four student loans totaling $27,777 in 2007. (GE 4.) As of September 2013, Equifax was reporting an additional student loan of $2,334, which was deferred. (GE 3.) Applicant testified that she has five student loan accounts. (Tr. 45-46.)

2 According to Applicant’s e-QIP, she was married in December 2007 and separated around April 2008. (GE 1.) She told the investigator she filed for divorce in May 2008, when her spouse moved out. (GE 2.)

3 Applicant paid her bankruptcy attorney around $1,000 for his services. (Tr. 61.)

4 Available credit information shows that Applicant owed a zero balance on the debt in SOR 1.fas of September 2008 after the debt was charged off and sold to another lender. (GEs 3, 4.) Applicant maintains that the account was included in her bankruptcy. (GEs 1, 2.) She included a $5,576.60 debt on her bankruptcy with a lender that does not appear on the credit reports. (GEs 3, 4.) It may well be the debt in SOR 1.f, which had a high credit of $5,723, but even if not, the debt has been charged off and is no longer legally collectible. 5 Applicant testified to her belief that the debt had been included in her bankruptcy. (Tr. 34.) However, the debt is not listed on either the Schedule D or Schedule F in evidence. (AE B.) 6 Based on the account numbers (GE 3), the debts in SOR 1.gand 1.hare the same debt. 7 The factors under AG ¶ 2(a) are as follows:

(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.