CASE · Clearance Adjudication Search EngineCASE

Loading case…

ISCR Case 13-00369.h1 — CASE

ISCR Case 13-00369.h1granted

Case Headnote

ISCR Case No. 13-00369.h1

grantedJan 10, 2014· Hon. John Grattan Metz, Jr.· hearing

Summary

A 67-year-old vice president for operations at a U.S. defense contractor was granted a security clearance despite initial concerns under Guideline F (Financial Considerations). The applicant faced allegations regarding nine delinquent accounts totaling nearly $117,000, including a $6,500 tax lien, a $3,500 debt, and delinquent first and second mortgages. Other issues included a debt paid in June 2009, a medical bill improperly coded, and a debt paid in May 2013. Arrangements were made to pay two additional debts.

Disqualifying conditions F.19(a) and F.19(c) were raised, but mitigating conditions F.20(a), F.20(b), and F.20(d) were applied. The judge determined that the financial difficulties were largely attributable to periods of unemployment beyond the applicant's control.

The clearance was granted because the applicant demonstrated a credible and realistic plan to resolve his financial problems. He made significant efforts to address his debts after securing stable employment in May 2012, and his remaining debts were under $2,500 and expected to be resolved shortly.

Why the Applicant Prevailed

The applicant demonstrated a credible and realistic plan to resolve his financial problems.
He made significant efforts to address his debts once he obtained stable employment in May 2012.
The applicant's remaining debts were under $2,500 and expected to be resolved shortly.

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(a)appliedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to Recur
F.20(b)appliedThe Conditions That Resulted in the Financial Problem Were Largely Beyond the Person’s Control
F.20(d)appliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve Debts

Key Rule Quoted

“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.”
— Department of the Navy v. Egan, 484 U.S. 518 (1988)

Procedural Posture

SOR issuedApr 5, 2013
Answer filed—Applicant requested a hearing.
Hearing heldAug 29, 2013
Decision dateJan 10, 2014

Cite For

Mitigation of Financial Issues Under Guideline F
Impact of Stable Employment on Financial Considerations
Criteria for Establishing a Credible Plan 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: granted

The judge found that the applicant had multiple financial concerns, including delinquent accounts totaling nearly $117,000, primarily due to periods of unemployment. However, the applicant demonstrated significant progress in addressing these debts, leading to a decision to grant the security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	$6,500 tax lien $6,500	For Applicant	Tax Unpaid	Denied	—	—	—
1.b	$3,500 debt $3,500	For Applicant	Unspecified Financial	Admitted	—	—	Claimed Payment Plan with Creditor
1.c	delinquent first mortgage	For Applicant	Mortgage or Home Loan Debt	Denied	—	—	Claimed Debt Paid in Full
1.d	delinquent second mortgage	For Applicant	Mortgage or Home Loan Debt	Denied	—	—	Claimed Debt Paid in Full
1.e	debt paid in June 2009	For Applicant	Unspecified Financial	Admitted	—	—	—
1.f	medical bill improperly coded	For Applicant	Medical Debt	Denied	—	—	—
1.g	arrangements to pay	For Applicant	Unspecified Financial	Unknown	—	—	Claimed Payment Plan with Creditor
1.h	paid in May 2013	For Applicant	Unspecified Financial	Admitted	—	—	—
1.i	arrangements to pay	For Applicant	Unspecified Financial	Unknown	—	—	Claimed Payment Plan with Creditor

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. 13-00369 ) Applicant for Security Clearance )

For Government: Philip J. Katauskas, Esquire, Department Counsel For Applicant: Pro se

01/10/2014 ______________

STATEMENT OF CASE

______________

METZ, John Grattan, Jr., Administrative Judge:

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

On 5 April 2013, the Department of Defense (DoD) sent Applicant a Statement of Reasons (SOR) detailing security concerns under Guideline F, Financial Considerations. Applicant timely answered the SOR, requesting a hearing before the Defense Office of Hearings and Appeals (DOHA). DOHA assigned the case to me 31 July 2013 and I convened a hearing 29 August 2013. DOHA received the transcript 5 September 2013.

FINDINGS OF FACT

Applicant admitted the SOR financial allegations except for SOR 1.a and SOR 1.c-e. He is a 67-year-old vice president for operations for a U.S. defense contractor since May 2012. He previously retired from the U.S. military after 20-years service in paygrade E-8.

The SOR alleges, and Government exhibits substantiate, nine delinquent accounts totaling nearly $117,000. Nearly $107,000 of that debt is for delinquent first and second mortgages. Applicant admits five debts totaling about $3,500.

The $6,500 tax lien at SOR debt 1.a was released in April 2008, before the SOR was issued (AE A). Applicant made arrangements with the creditor at SOR debt 1.bto satisfy the debt by September 2013. He received a mortgage modification from the lender for SOR debts 1.cand 1.din August 2012 and has been current in his payments since. He paid SOR debt 1.e in June 2009. SOR debt 1.fwas a medical bill improperly coded by the provider to exclude insurance coverage. Applicant paid SOR debt 1.hin May 2013, and made arrangements to pay SOR debts 1.i and 1.gin August and September 2013 respectively.

Applicant’s financial problems were largely related to periods of unemployment he experienced from September 2002 to March 2003, March to September 2006, May to September 2007 and December 2007 to May 2012. In each instance, he began addressing his debts as soon as he was re-employed.

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.3

ANALYSIS

The Government established a case for disqualification under Guideline F, but Applicant mitigated the security concerns. Applicant’s four periods of unemployment between September 2002 and May 2012 created financial problems for him.4

The mitigating factors for financial considerations give Applicant substantial aid. While his financial difficulties are both recent and multiple, Applicant’s employment is now stable;so the circumstances that caused them are less likely to recur. Further, his financial problems were largely due to circumstances beyond his control, and he began addressing his delinquent debts once he obtained stable employment in May 2012. He has continued to address his other delinquent debts since then. While there is no evidence that Applicant has had any financial counseling, he has clearly acted to get his finances under control. The only debts not completely resolved total under $2,500 and are expected to be resolved by September 2013. Having addressed his other financial obligations, I am confident these final obligations will also be addressed. Overall, substantial progress has been made addressing his delinquent debt. The Appeal Board has stated that an Applicant need not have paid every debt alleged in the SOR, need not pay the SOR debts first, and need not be paying on all debts simultaneously. Applicant need only establish that there is a credible and realistic plan to resolve the financial problems, accompanied by significant actions to implement the plan.9 Applicant’s efforts to date constitute such a plan, and his consistent payments reflect significant actions. I conclude Guideline F for Applicant.

FORMAL FINDINGS

Paragraph 1. Guideline F: FOR APPLICANT

Subparagraphs a-i: For Applicant

CONCLUSION

Under the circumstances presented by the record in this case, it is clearly consistent with the national interest to grant or continue a security clearance for Applicant. Clearance granted.

JOHN GRATTAN METZ, JR. Administrative Judge

FOOTNOTES

Consisting of the transcript (Tr.), Government exhibits (GE) 1-5, and Applicant exhibit (AE) A. 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. 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. ISCR Case No. 07-06482 (App. Bd. 21 May 2008).