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ISCR Case 12-08738.h1 — CASE

ISCR Case 12-08738.h1denied

Case Headnote

ISCR Case No. 12-08738.h1

deniedApr 23, 2015· Hon. John Grattan Metz, Jr.· hearing

Summary

A 39-year-old shipfitter employed by a U.S. defense contractor was denied a security clearance under Guideline F (Financial Considerations) due to significant and ongoing financial difficulties. The applicant faced allegations concerning multiple delinquent debts totaling over $62,000.

Specifically, the applicant initially denied a $19,891 debt but later provided documentation confirming a $19,981 figure to the same creditor. He admitted to seven additional debts totaling nearly $32,000 and acknowledged a collection account for a purchased debt that had grown from $19,981 to $27,960, reaching $30,557 by October 2014.

The denial was based on the applicant's extensive and unresolved financial history, his failure to provide evidence of efforts to resolve debts or contact creditors, and his lack of financial or credit counseling. These factors indicated a lack of responsibility in addressing his financial obligations, leading to the denial of his security clearance.

Why the Applicant Was Denied

The applicant has an extensive history of financial difficulties, which are ongoing and seem unlikely to be resolved any time soon.
The applicant provided no evidence of efforts to resolve his debts or contact with creditors.
The applicant has not received any financial or credit counseling.

Conditions Referenced

Disqualifying

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

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 issuedNov 17, 2014
Answer filed—Applicant requested a decision without hearing.
Hearing held—No hearing was conducted.
Decision dateApr 23, 2015

Cite For

Denial of Security Clearance Due to Ongoing Financial Difficulties Under Guideline F
Lack of Evidence for Mitigating Financial Conditions
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 several delinquent debts totaling over $62,000, which the applicant admitted. The applicant's lack of action to resolve these debts and absence of financial counseling led to a decision against granting a security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant denied the debt in SOR 1.a and the amount owed. However, he listed a $19,891 debt to the same creditor on his clearance application, and provided additional documentation of the $19,981 figure in his answer to the SOR. $19,981	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Applicant admitted seven debts totaling nearly $32,000. $32,000	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	Applicant acknowledged a collection account to the successor in interest—a creditor who purchased a $19,981 debt which had grown to $27,960. $27,960	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	The balance had grown to $30,557 by October 2014. $30,557	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	Applicant has an extensive history of financial difficulties, which are ongoing, and seem unlikely to be resolved any time soon.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	Applicant has not been responsible in addressing his debt.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	Applicant has had no credit or financial counseling, and his debts are clearly not being resolved.	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	There are no signs that Applicant has been in contact with any of his creditors, and thus he cannot establish that he has made a good-faith effort to address his debts.	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: ) ) XXXX, Xxxxx Xxxxx ) ISCR Case No. 12-08738 ) Applicant for Security Clearance )

For Government: Julie R. Mendez, Esquire, Department Counsel For Applicant: Pro se

04/23/2015 ______________

STATEMENT OF CASE

______________

METZ, John Grattan, Jr., Administrative Judge:

Based on the record in this case, I deny Applicant’s clearance.

On 17 November 2014, the Department of Defense (DoD) sent Applicant a Statement of Reasons (SOR) raising security concerns under Guideline F, Financial Considerations. Applicant timely answered the SOR, requesting a decision without hearing by the Defense Office of Hearings and Appeals (DOHA). The record in this case closed 26 March 2015, when Applicant’s response to the FORM was due. Applicant provided no additional documents. DOHA assigned the case to me 13 April 2015.

FINDINGS OF FACT

Applicant admitted the SOR financial allegations, except for SOR 1.a. He is a 39- year-old shipfitter employed by a U.S. defense contractor since May 2012. He has not previously held a clearance. Applicant was laid off from his job in May 2009, and remained unemployed until June 2010, when he obtained a job as a maintenance worker, a job he held until he obtained his most recent employment. Before his May 2009 layoff, Applicant had been continuously employed since at least May 2002 (Item 3).

The SOR alleges, and Government exhibits (Items 4-6) substantiate, eight delinquent debts totaling over $62,000. Applicant admits seven debts totaling nearly $32,000.3

Applicant’s May 2012 clearance application (Item 3) reported six of the eight delinquent accounts alleged in the SOR (SOR 1.a-1e, and 1.h). He implied that he was getting this job to pay these debts. Moreover, during a June 2012 subject interview, he acknowledged the six debts he listed on his clearance application, acknowledged the two remaining SOR debts (SOR 1.f-1.g), and stated his intent to get caught up on his debts and stay caught up on his debts (Item 6). However, Applicant admitted that he lacked the means to address his delinquent debts at the time and was living paycheck to paycheck.

Applicant apparently has had no contact with his creditors since the accounts fell delinquent when he became unemployed. He has stated no further plan for addressing his delinquent debts. He provided no budget or financial statement. Applicant has not received any financial or credit counseling. He provided no work or character references.

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.4

ANALYSIS

The Government established a case for disqualification under Guideline F, and Applicant did not mitigate the security concerns. Applicant has an extensive history of financial difficulties, which are ongoing, and seem unlikely to be resolved any time soon. Applicant’s financial problems date to May 2009, when he experienced a year of unemployment. However, Applicant has been re-employed since June 2010 and in this apparently better job since May 2012. There is no evidence of any efforts by Applicant to resolve the debts.

Applicant meets none of the mitigating conditions for financial considerations. His financial difficulties are both recent and multiple; although the immediate cause of his problems may be unlikely to recur if he remains employed. Applicant’s 2009-2010 unemployment was certainly beyond his control, but he has not been responsible in addressing his debt. Applicant has had no credit or financial counseling, and his debts are clearly not being resolved. There are no signs that Applicant has been in contact with any of his creditors, and thus he cannot establish that he has made a good-faith effort to address his debts. Moreover, Applicant has mostly disregarded these financial obligations since becoming re-employed in June 2010. His documented inaction for nearly five years raises significant security concerns that Applicant has not begun to address. Accordingly, I conclude Guideline F against Applicant.

FORMAL FINDINGS

Paragraph 1. Guideline F: AGAINST APPLICANT

Subparagraphs a-h: Against 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 File of Relevant Material (FORM), Items 1-7,

DoD acted under Executive Order 10865, Safeguarding Classified Information Within Industry (February 20, 1960), as amended; 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. Applicant denied the debt in SOR 1.a and the amount owed. However, he listed a $19,891 debt to the same creditor on his clearance application, and provided additional documentation of the $19,981 figure in his answer to the SOR. Nevertheless, during a June 2012 subject interview (Item 6), Applicant discussed his May 2012 credit report (Item 5). He acknowledged a collection account to the successor in interest—a creditor who purchased a $19,981 debt which had grown to $27,960. The new creditor applied a new account number to the account, but it is clearly the same account. The balance had grown to $30,557 by October 2014 (Item 4). 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 (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; ¶20 (d) the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.