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ISCR Case 14-05519.h1 — CASE

ISCR Case 14-05519.h1denied

Case Headnote

ISCR Case No. 14-05519.h1

deniedMay 23, 2016· Hon. Marc E. Curry· hearing

Summary

A 53-year-old married man was denied a security clearance under Guideline E (Personal Conduct) and Guideline F (Financial Considerations) due to significant financial issues and intentional omissions on his application. The Statement of Reasons alleged that the applicant failed to disclose approximately $18,000 in delinquent debt, including a $5,718 deficiency balance from a repossessed vehicle, as required in Section 26 of his application.

Disqualifying conditions under AG ¶ 19(a), AG ¶ 19(c), and AG ¶ 16(a) were raised. While mitigating conditions under AG ¶ 20(b), AG ¶ 20(c), and AG ¶ 20(d) were applied, they were insufficient to overcome the concerns.

The denial was based on the applicant's failure to provide evidence of progress in addressing his financial problems and his intentional omission of relevant financial information from his security clearance application. Despite circumstances beyond his control contributing to his financial difficulties, he did not offer a valid explanation for these omissions or demonstrate sufficient progress in resolving his debts.

Why the Applicant Was Denied

Applicant failed to provide evidence of progress in addressing his financial problems.
Applicant intentionally omitted relevant financial information from his security clearance application.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations
AG ¶ 16(a)appliedDeliberate Omission, Concealment, or Falsification of Relevant Facts

Mitigating

AG ¶ 20(b)appliedConditions Largely Beyond the Person's ControlCircumstances beyond Applicant's control contributed to his financial problems.
AG ¶ 20(c)rejectedReceiving Counseling for the ProblemApplicant provided no proof of the terms of his credit counseling agreement.
AG ¶ 20(d)rejectedGood-faith Effort to Repay CreditorsApplicant did not provide evidence of payments made toward his debts.

Key Rule Quoted

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

Procedural Posture

SOR issuedFeb 5, 2015
Answer filedMar 2, 2015Applicant requested a decision on the written record.
Hearing held—
Decision dateMay 23, 2016

Cite For

Failure to Disclose Relevant Financial Information Under Guideline E
Impact of Financial Issues on Security Clearance Eligibility Under Guideline F
Importance of Providing Evidence of Debt Resolution Efforts in Security Clearance Cases

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 E (Personal Conduct) · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The judge found against the applicant on the personal conduct allegations under Guideline E. The applicant admitted to intentionally omitting relevant financial information from his security clearance application, which the judge determined constituted a deliberate falsification without any mitigating factors.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a	Applicant did not disclose any delinquent debts, as required in response to Section 26.	Against Applicant	Falsification Security FormFOUND DELIBERATE	Financial	Admitted	(a) deliberate omission, concealment, or falsification on a security form	—	—

Descriptive standardized rendering of a decided public case (Guideline E). The verbatim source decision is shown in full below.

Standardized Decision Profile

SEAD-4 Guideline F · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The judge found that the applicant had significant financial problems, including approximately $18,000 in delinquent debt, which he failed to adequately address or disclose on his security clearance application. Despite some mitigating circumstances, the applicant's lack of evidence regarding his financial management efforts led to a denial of his security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	specific text not stated in this decision	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	approximately $18,000 of delinquent debt, including the deficiency balance on a repossessed car totaling $5,718 $5,718	Against Applicant	Auto Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c–1.l	10 sub-charges — specific text not stated in this decision (against the applicant).	Against 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. 14-05519 ) Applicant for Security Clearance )

For Government: Candace L. Garcia, Esq., Department Counsel For Applicant: Pro se

05/23/2016 ______________

STATEMENT OF CASE

______________

CURRY, Marc E., Administrative Judge:

Although Applicant’s financial problems were significantly caused by circumstances beyond his control, he failed to provide evidence documenting what progress, if any, that he has made in addressing them. Moreover, he provided no explanation for failing to disclose relevant financial information, as required, on his clearance application. Clearance is denied.

Statement of the Case

On February 5, 2015, the Department of Defense Consolidated Adjudications Facility (DOD CAF) issued a Statement of Reasons (SOR) to Applicant detailing security concerns under Guideline F, financial considerations, and Guideline E, personal conduct. 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) implemented by the DOD on September 1, 2006. On March 2, 2015, Applicant answered the SOR, admitting all of the allegations and requesting a decision on the written record rather than a hearing.

On May 4, 2015, Department Counsel prepared a File of Relevant Materials (FORM). Applicant was provided a copy of the FORM on May 21, 2015, and was instructed that he had 30 days to file any objections to this information, or to supply additional information. Applicant did not file a response. On February 3, 2015, the case was assigned to me.

FINDINGS OF FACT

Applicant is a 53-year-old married man with an adult child. He has been married since 2009. A previous marriage ended in divorce in 1988. Applicant earned a GED in 1979 and an electronics trade school certificate in 1982. (Item 2 at 11) Since March 2014, he has worked for a defense contractor as a field service engineer.

Before beginning his current job, Applicant had been unemployed for approximately seven months, having been laid off from his previous job. While unemployed, he fell behind on his finances. Currently, he has approximately $18,000 of delinquent debt, including the deficiency balance on a repossessed car totaling $5,718 (subparagraph 1.b). In February 2015, Applicant retained a credit counselor and developed a payment plan. (Item 1 at 5) He provided no evidence of how much he is supposed to pay monthly, nor did he provide a projected date when the debts would be satisfied.

Applicant completed a security clearance application in March 2014. He did not disclose any delinquent debts, as required in response to Section 26. (Item 2 at 40-42) During an interview with an investigative agent, Applicant explained that he did not list any delinquent debts because Section 26 required the disclosure of debts that were more than 120 days late, and none of his debts met this criterion when he completed the SOR. Later, in Applicant’s supplemental answer to the SOR, he admitted intentionally omitting his delinquent debts from his security clearance application.

POLICIES

The adjudicative guidelines list potentially disqualifying conditions and mitigating conditions. These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, they are applied together with the factors listed in the adjudicative process. 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.”

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 for obtaining a favorable security decision.

ANALYSIS

Guideline F, Financial Considerations

Under this guideline,“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.” (AG ¶ 18) Applicant’s history of financial problems triggers the application of AG ¶ 19(a), “inability or unwillingness to satisfy debts,” and AG ¶ 19(c), “a history of not meeting financial obligations.”

The following mitigating conditions under AG ¶ 20 are potentially applicable:

(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; and

(d) the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debt.

Applicant’s financial problems stem from a seven-month unemployment period between August 2013 and March 2014. Since then, he has retained a credit counseling agency to help him develop a debt repayment plan. Conversely, this is not the first time that Applicant has had difficulty paying his debts. Between 1999 and 2005, he incurred approximately $11,000 of delinquent debt, including the deficiency on a loan for a car that was repossessed. Under these circumstances, AG ¶ 20(b) is only partially applicable. Although Applicant provided evidence that he has retained a credit counseling agency, he provided no proof of the terms of their agreement, nor any proof that he has been making payments. Under these circumstances, AG ¶¶ 20(c) and 20(d) do not apply.

Personal Conduct

Under this guideline, “conduct involving questionable judgment, lack of candor, dishonesty, or unwillingness to comply with rules and regulations can raise questions about an individual’s reliability, trustworthiness, and ability to protect classified information.” (AG ¶ 15) Moreover, “of special interest is any failure to provide truthful and candid answers during the security clearance process . . .” (Id.)

After initially denying that he intentionally omitted relevant information about his delinquent finances from his security clearance application, Applicant later admitted the allegation, and offered no further explanation. AG ¶ 16(a), “deliberate omission, concealment, or falsification of relevant facts from any personnel security questionnaire, personal history statement, or similar form used to conduct investigations, determine employment qualifications, award benefits or status, determine security clearance eligibility or trustworthiness, or award fiduciary responsibilities,” applies without mitigation.

WHOLE PERSON CONCEPT

Under the whole-person concept, the administrative judge should consider the nine adjudicative process factors listed at AG ¶ 2(a). They 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.

Circumstances beyond Applicant’s control clearly contributed to his financial problems. However, he provided minimal supporting evidence documenting steps taken to get his financial problems under control. This failure, together with his falsification of his security clearance application, compel me to conclude that he has not mitigated the security 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.l: Against Applicant

Paragraph 2, Guideline E: AGAINST APPLICANT

Subparagraph 2.a: Against 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.

MARC E. CURRY Administrative Judge