CASEClearance Adjudication Search EngineCASE

Loading case…

ISCR Case 14-02377.h1 — CASE

ISCR Case 14-02377.h1denied

Case Headnote

ISCR Case No. 14-02377.h1

deniedAug 20, 2015· Hon. Robert E. Coacher· hearing

Summary

A 26-year-old federal contractor employee was denied eligibility for access to sensitive information due to financial considerations under Guideline F. The Statement of Reasons detailed multiple delinquent debts totaling over $16,213, including various past rent debts, credit card debts, car debt, telecommunications debts, medical accounts, utility debt, and court-related debts. Additionally, the applicant failed to file her 2012 state income tax return and had delinquent state and federal tax debts.

Disqualifying conditions cited included a history of not meeting financial obligations, an inability or unwillingness to satisfy debts, and a history of not filing tax returns. While mitigating conditions were considered, such as the debts not being recent and some efforts to resolve them, these were deemed insufficient.

The judge found that the applicant had numerous unresolved delinquent debts and did not demonstrate a meaningful track record of financial responsibility or sufficient efforts to resolve her financial issues. Consequently, the applicant's request for a security clearance was denied.

Why the Applicant Was Denied

The applicant has numerous unresolved delinquent debts and failed to file her 2012 state income tax return.
The applicant did not demonstrate a meaningful track record of financial responsibility or sufficient efforts to resolve her debts.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations
AG ¶ 19(g)raisedFailure to File Annual Federal, State, or Local Income Tax Returns

Mitigating

AG ¶ 20(b)appliedConditions Beyond the Person's ControlThe applicant experienced periods of unemployment and her husband's mental health issues contributed to their financial problems.
AG ¶ 20(d)rejectedGood-faith Effort to Repay Overdue CreditorsThe applicant's efforts to resolve debts were minimal and insufficient.

Key Rule Quoted

“A person who seeks access to sensitive information enters into a fiduciary relationship with the Government predicated upon trust and confidence.”

Procedural Posture

SOR issuedOct 1, 2014
Answer filedJan 7, 2015
Hearing heldMay 20, 2015
Decision dateAug 20, 2015

Cite For

Insufficient Evidence of Financial Responsibility Under Guideline F
Impact of Unresolved Debts on Trustworthiness Determinations
Consideration of Personal Circumstances in Financial Issues

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 unresolved debts and a failure to file a state income tax return. Despite some debts being paid, the applicant's overall financial situation raised significant trustworthiness concerns, leading to a denial of eligibility for access to sensitive information.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	past rent debt- $1,921 $1,921	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	past rent debt- $1,120 $1,120	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	specific text not stated in this decision	Against Applicant	Unspecified Financial	Denied	—	—	—
1.d	credit card debt- $948 $948	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	car debt- $854 $854	Against Applicant	Auto Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	telecommunications debt- $552 $552	Against Applicant	Utility or Phone Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	credit card debt- $470 $470	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	medical accounts $294 $294	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	medical accounts $282 $282	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.j	medical accounts $100 $100	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.k	medical accounts $95 $95	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.l	utility debt- $56 $56	Against Applicant	Utility or Phone Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.m	past rent debt- $748 $748	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.n	court-related debts $739 $739	For Applicant	Unspecified Financial	Admitted	—	—	—
1.o	telecommunications account $1,132 $1,132	Against Applicant	Utility or Phone Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.p	medical accounts $442 $442	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.q	medical accounts $139 $139	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.r	medical accounts $659 $659	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.s	medical accounts $579 $579	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.t	medical accounts $117 $117	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.u	specific text not stated in this decision	For Applicant	Unspecified Financial	Denied	—	—	—
1.v	failure to file state income tax return for 2012	Against Applicant	Tax Filing Failure	Admitted	(g) unexplained affluence	—	—
1.w	state tax debt- $1,635 $1,635	Against Applicant	Tax Unpaid	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.x	delinquent federal taxes $2,000 $2,000	For Applicant	Tax Unpaid	Admitted	—	—	—
1.y–1.z	2 sub-charges — specific text not stated in this decision (rulings shown). (low confidence)	Mixed			—	—	—

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: ) ) ) ADP Case No. 14-02377 ) Applicant for Public Trust Position )

For Government: Robert J. Kilmartin, Esq., Department Counsel For Applicant: Pro se

08/20/2015 ______________

STATEMENT OF CASE

______________

COACHER, Robert E., Administrative Judge:

Applicant has not mitigated the financial considerations trustworthiness concerns. Eligibility for access to sensitive information is denied.

Statement of the Case

On October 1, 2014, the Department of Defense (DOD) issued Applicant a Statement of Reasons (SOR) detailing trustworthiness concerns under Guideline F, financial considerations. DOD acted under Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); DOD Regulation 5200.2-R, Personnel Security Program, dated January 1987, as amended (Regulation); and the adjudicative guidelines (AG) effective within the DOD on September 1, 2006.

Applicant answered (Ans.) the SOR on January 7, 2015, and requested a hearing before an administrative judge. The case was assigned to me on April 22, 2015. The Defense Office of Hearings and Appeals (DOHA) issued a notice of hearing on May 4, 2015, and the hearing was convened as scheduled on May 20, 2015. The Government offered exhibits (GE) 1 through 4, which were admitted into evidence without objection. Applicant testified and offered exhibits (AE) A through D, which were admitted into evidence without objection. The record was held open for Applicant to submit additional information. Applicant submitted AE E, which was admitted into evidence without objection. DOHA received the hearing transcript (Tr.) on May 28, 2015.

FINDINGS OF FACT

Applicant admitted the following SOR allegations: ¶¶ 1.a - 1.b, 1.d - 1.m, 1.o – 1.t, and 1.v – 1.x. She denied ¶¶ 1.c, 1.n, and 1.u. The admissions are incorporated as findings of fact. After a review of the pleadings and evidence, I make the following additional findings of fact.

Applicant is a 26-year-old employee of a federal contractor. She has worked for this employer since September 2013. She is a high school graduate. She is married and has no children. She has no military service and this is her first time seeking a trustworthiness determination.1

The SOR alleges 23 delinquent debts and failure to file her 2012 state income tax return for a total amount of debt in excess of $16,213. The debts were listed in credit reports from September 2013, May 2014, and April 2015.2

Applicant’s financial problems arose because of periods of unemployment, the most recent was more than a month in 2010. Additionally, her husband suffered some mental health issues which caused him periods of unemployment, which affected their overall finances. Her husband is currently employed with the same contractor for whom she works. Applicant has looked into filing a Chapter 7 bankruptcy petition, but could not afford the attorney’s fee. She provided a personal financial statement from April 2014 showing that she has $20 left over every month after paying all expenses (not accounting for any debt payments). During her November 2013 trustworthiness interview, she acknowledged the debts and indicated that she would “take care” of the debts by 2014. The status of the SOR-related debts is as follows:3

SOR ¶¶ 1.a and 1. c (past rent debt- $1,921; $1,000):

Applicant was evicted from this property because of nonpayment of rent. She claims that both debts result from the same transaction. The most recent credit report shows that each debt has a different account number. She did not produce evidence indicating they are the same debt. These debts are unresolved.4 SOR ¶ 1.b (past rent debt- $1,120):

The date of last activity for this rent collection debt was January 2008. This debt has not been resolved.5

SOR ¶ 1.d (credit card debt- $948):

The date of last activity for this credit card collection debt was October 2007. This debt has not been resolved.6

SOR ¶ 1.e (car debt- $854):

The date of last activity for this collection debt was May 2012. Applicant explained that she was working toward paying this debt, but produced no evidence of results. This debt has not been resolved.7

SOR ¶ 1.f (telecommunications debt- $552):

The date of last activity for this collection debt was December 2007. Applicant indicated this debt was not a priority for her to pay. This debt has not been resolved.8

SOR ¶ 1.g (credit card debt- $470):

The date of last activity for this collection debt was January 2008. This debt has not been resolved.9

SOR ¶¶ 1.h – 1kand 1.p – 1.t (medical accounts $294; $282; $100; $95; $56; 442; $139; $659; $579; $117):

Applicant admitted these delinquent medical accounts. She stated in her background interview they would be paid by January 2015, but provided no proof of payment. These debts are unresolved.10 SOR ¶ 1.l (utility debt- $56):

The date of last activity for this collection debt was January 2013. Applicant indicated the debt would be paid a few weeks from April 2014. She failed to supply proof of payment. This debt has not been resolved.11

SOR ¶ 1.m (past rent debt- $748):

A judgment against Applicant was entered April 2003. This debt has not been resolved.12

SOR ¶¶ 1.n, 1.u (court-related debts $739; $331):

Applicant provided documentary support showing she paid these two delinquent debts that resulted from traffic offenses. These debts are resolved.13

SOR ¶ 1.o (telecommunications account $1,132):

The date of first delinquency for this account was February 2012. Applicant plans on seeking a settlement, but provided no details. This debt is unresolved.14

SOR ¶¶ 1.v – 1.w (failure to file state income tax return for 2012 and state tax debt- $1,635):

Applicant admitted to failing to file her 2012 state income tax return. She stated that she now has filed that return. Evidence shows that she filed her 2012 federal tax return, and that she made three $100 payments toward her state tax debt bringing the balance down to $256. This debt is being resolved and the failure to file issue is resolved.15

SOR ¶ 1.x (delinquent federal taxes $2,000):

Applicant provided documentation showing that her paycheck is garnished $80 every two weeks to pay this federal tax debt. This debt is resolved.16 Applicant’s mother wrote a letter of support indicating that Applicant was a strong and responsible person who is trying to get her financial house back in order. She has seen growth and maturity in her daughter and asks that she be allowed to continue in her job.17

POLICIES

Positions designated as ADP I and ADP II are classified as “sensitive positions.” (See Regulation ¶¶ C3.1.2.1.1.7 and C3.1.2.1.2.3.) “The standard that must be met for . . . assignment to sensitive duties is that, based on all available information, the person’s loyalty, reliability, and trustworthiness are such that . . . assigning the person to sensitive duties is clearly consistent with the interests of national security.” (See Regulation ¶ C6.1.1.1.) The Deputy Under Secretary of Defense (Counterintelligence and Security) Memorandum, dated November 19, 2004, indicates trustworthiness adjudications will apply to cases forwarded to DOHA by the Defense Security Service and Office of Personnel Management. Department of Defense contractor personnel are afforded the right to the procedures contained in the Directive before any final unfavorable access determination may be made. (See Regulation ¶ C8.2.1.)

When evaluating an applicant’s suitability for a public trust position, the administrative judge must consider the disqualifying and mitigating conditions in the AG. 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 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 “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 [sensitive] 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 ¶ 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 as to obtaining a favorable trustworthiness decision.

A person who seeks access to sensitive 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 sensitive information. Decisions include, by necessity, consideration of the possible risk the applicant may deliberately or inadvertently fail to protect or safeguard sensitive information. Such decisions entail a certain degree of legally permissible extrapolation as to potential, rather than actual, risk of compromise of sensitive information.

ANALYSIS

Guideline F, Financial Considerations

The trustworthiness concern for financial considerations is set out in AG ¶ 18 as follows:

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 trustworthiness concerns under AG ¶ 19. Three are potentially applicable in this case:

(a) inability or unwillingness to satisfy debts;

(g) failure to file annual Federal, state, or local income tax returns as required or the fraudulent filing of the same

Applicant has numerous delinquent debts and she failed to file her 2012 state tax return. The evidence is sufficient to raise the above disqualifying conditions.

Several financial considerations mitigating conditions under AG ¶ 20 are potentially applicable:

(a) the behavior happened so long ago, was so infrequent, or occurred under such circumstances that it is unlikely to recur and does not cast doubt on the individual’s current reliability, trustworthiness, or good judgment;

(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; (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;

(d) the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts; and

(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.

Applicant’s debts are recent, multiple, and cast doubt on her reliability, trustworthiness, and good judgment. Although two debts were paid, one is being paid through involuntary garnishment actions, and she is making payments on her state tax debt, the remaining debts are unpaid. AG ¶ 20(a) is not applicable.

She was unemployed for periods of time, most recently for over a month in 2010 and her husband had medical problems that prevented his employment. This is a condition beyond her control. She has made minimal effort to resolve the debts. She paid two, is paying her federal tax debt through wage garnishment, and her state debt through payments. Overall, the record evidence does not support that Applicant’s actions were responsible under the circumstances. AG ¶ 20(b) is partially applicable.

Other than inquiring into the possibility of filing a Chapter 7 bankruptcy petition, there is no evidence of financial counselling. Given the unpaid status of the SOR debts, there are not clear indications that Applicant’s financial problems are under control. Although she paid two debts, is paying one through garnishment, and her state tax debt through a payment plan, evidence of good-faith efforts to pay or resolve the remaining debts is lacking. The debts that were paid are found in favor of Applicant. AG ¶ 20(c) does not apply and ¶ 20(d) partially applies.

Applicant failed to supply documentary evidence to support her dispute of SOR ¶ 1.cbeing duplicative with SOR ¶ 1.a. AG ¶ 20(e) does not apply.

WHOLE PERSON CONCEPT

Under the whole-person concept, the administrative judge must evaluate an applicant’s eligibility for access to sensitive information 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 access to sensitive information must be an overall commonsense assessment based upon careful consideration of the guidelines and the whole-person concept.

I considered the potentially disqualifying and mitigating conditions in light of all relevant facts and circumstances surrounding this case. I have incorporated my comments under Guideline F in my whole-person analysis. Some of the factors in AG ¶ 2(a) were addressed under that guideline, but some warrant additional comment.

I considered the circumstances by which Applicant became indebted and the character letter from her mother. However, I also considered that she has taken very little action to resolve her financial situation. She has not established a meaningful track record of financial responsibility, which causes me to question her ability to resolve her debts.

Overall, the record evidence leaves me with questions and doubts about Applicant’s eligibility and suitability for access to sensitive information. For all these reasons, I conclude Applicant has not mitigated the financial considerations trustworthiness concerns.

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

Subparagraphs: 1.a– 1.m: Against Applicant Subparagraph: 1.n: For Applicant Subparagraphs: 1.o – 1.t: Against Applicant Subparagraphs: 1.u – 1.x: For Applicant

CONCLUSION

In light of all of the circumstances presented by the record in this case, it is not clearly consistent with national security to grant Applicant eligibility for access to sensitive information. Eligibility for access to sensitive information is denied.

________________________ Robert E. Coacher Administrative Judge

FOOTNOTES

1 Tr. at 5, 6, 19, 28, 29; GE 1. 2 GE 3-5. 3 Tr. at 26-27; GE 2; Ans. 4 Tr. at 60-61; GE 2; Ans. 5 Tr. at 60-61; GE 2, 4; Ans. 6 Tr. at 61-62; GE 4; Ans. 7 Tr. at 62; GE 4; Ans. 8 Tr. at 63; GE 4; Ans. 9 Tr. at 63; GE 4; Ans. 10 Tr. at 63-64, 66-67; GE 4; Ans. 11 Tr. at 64; GE 4; Ans. 12 Tr. at 65; GE 5; Ans. 13 Tr. at 65, 68; AE A; Ans. 14 Tr. at 66; GE 5; Ans. 15 Tr. at 68; GE 2; AE B, C; Ans. 16 Tr. at 68; GE 2; AE E; Ans. 17 AE D.