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ISCR Case 15-00367.h1 — CASE

ISCR Case 15-00367.h1denied

Case Headnote

ISCR Case No. 15-00367.h1

deniedOct 15, 2015· Hon. Jennifer I. Goldstein· hearing

Summary

A 41-year-old defense contractor was denied a security clearance under Guideline F (Financial Considerations) due to unresolved financial issues. The Statement of Reasons detailed 15 delinquent debts totaling approximately $14,916. These included a 2010 judgment for $472, an automobile loan of $8,647 delinquent since 2010, eleven other consumer collection accounts totaling $5,693, a $63 delinquent medical account, and a $41 public library fee.

The denial was based on the applicant remaining indebted to these 15 creditors. The judge found insufficient evidence of the applicant's efforts to resolve the debts or demonstrate responsible financial behavior. Specifically, no evidence of financial counseling or rehabilitation was presented.

The adjudicator concluded that the applicant's financial irresponsibility raised significant security risks, leading to the denial of the security clearance. Disqualifying conditions under Adjudicative Guideline Paragraphs 19(a) and 19(c) were raised.

Why the Applicant Was Denied

Applicant remains indebted to 15 creditors totaling approximately $14,916.
Applicant failed to provide sufficient evidence of efforts to resolve his debts or demonstrate responsible financial behavior.
No evidence of financial counseling or rehabilitation was presented.

Conditions Referenced

Disqualifying

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

Key Rule Quoted

“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.”

Procedural Posture

SOR issuedMay 28, 2015
Answer filedJun 19, 2015Applicant requested a decision on the written record.
Hearing held—No hearing; case decided on the written record.
Decision dateOct 15, 2015

Cite For

Denial of Security Clearance Due to Unresolved Financial Obligations
Insufficient Evidence of Financial Responsibility Under Guideline F
Impact of Financial Issues on Security Clearance Eligibility

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 applicant was found to have 15 delinquent debts totaling approximately $14,916, which raised significant security concerns under Guideline F. The judge ruled against the applicant, determining that he failed to provide sufficient evidence to mitigate these financial issues, leading to a denial of his security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	a 2010 judgment against him in the amount of $472 $472	Against Applicant	Judgment Against Applicant	Admitted	—	—	—
1.b	an automobile loan in the amount of $8,647 that has been delinquent since 2010 $8,647	Against Applicant	Auto Loan Debt	Admitted	—	—	—
1.c	11 other delinquent consumer collection accounts totaling $5,693 $5,693	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.n	a delinquent medical account totaling $63 $63	Against Applicant	Medical Debt	Admitted	—	—	—
1.o	a fee owed to a public library in the amount of $41 $41	Against Applicant	Unspecified Financial	Admitted	—	—	—

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. 15-00367 ) ) Applicant for Security Clearance )

For Government: Tara R. Karoian, Esq., Department Counsel For Applicant: Pro se

October 15, 2015 ______________

STATEMENT OF CASE

______________

GOLDSTEIN, Jennifer I., Administrative Judge:

Applicant remains indebted to 15 creditors in the total approximate amount of $14,916. Resulting security concerns were not mitigated. Based on a review of the pleadings and exhibits, eligibility for access to classified information is denied.

Statement of the Case

Applicant submitted a security clearance application on July 17, 2014.1 On May 28, 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). 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 that came into effect in the Department of Defense on September 1, 2006.

Applicant submitted a written response to the SOR, dated June 19, 2015, and requested that his case be decided by an administrative judge on the written record without a hearing.2 Department Counsel submitted the Government’s written case on July 27, 2015, containing five Items. A complete copy of the File of Relevant Material (FORM) was provided to Applicant, and he was afforded an opportunity to file objections and submit material in refutation, extenuation, or mitigation within 30 days of his receipt of the FORM.

Applicant signed the document acknowledging receipt of his copy of the FORM on August 4, 2015. He submitted a two-page response to the FORM (Response), made no objection to consideration of any contents of the FORM, and did not request additional time to respond. Department Counsel had no objections to Applicant’s Response and it was admitted. I received the case assignment on September 3, 2015.

FINDINGS OF FACT

Applicant is 41 years old, and has worked for a defense contractor since September 2007. He is married, and has one adult stepchild.3

The Government alleged that Applicant is ineligible for a clearance because he made financial decisions that indicate poor self-control, lack of judgment, or unwillingness to abide by rules and regulations, all of which raise questions about his reliability, trustworthiness and ability to protect classified information. The SOR alleged that Applicant is delinquent on 15 debts in the total amount of $14,916. In Item 2, Applicant admitted all 15 of the delinquent debts as set forth in SOR ¶¶ 1.a through 1.o. Applicant’s delinquent accounts appeared on his credit report dated July 26, 2014.4

Applicant’s 15 debts consist of a 2010 judgment against him in the amount of $472 (SOR ¶ 1.a); an automobile loan in the amount of $8,647 that has been delinquent since 2010 (SOR ¶ 1.b); 11 other delinquent consumer collection accounts totaling $5,693 (SOR ¶¶ 1.cthrough 1.m); a delinquent medical account totaling $63 (SOR ¶ 1.n); and a fee owed to a public library in the amount of $41 (SOR ¶ 1.o).

Applicant’s Response included a letter and a receipt. He indicated in his letter:

I am writing to submit materials that I am currently working to clear matters on my credit report. I have disputed items on my file with Equifax: The confirmation number for this case is [omitted] and was disputed Wednesday August 19, 2015. I will receive a letter on this matter within 30 days. Also in trying to gain a security clearance I have started paying old debts[.] [A]ttached you will find where I made [a] payment to [creditor1.k] an[d] enclosed is a confirmation of that payment.

The second page of the Response showed that Applicant made a $51.95 payment on June 26, 2015, to the creditor alleged in SOR ¶ 1.k. It does not reflect if this payment was part of a payment plan to resolve the $242 debt owed to this creditor. Applicant failed to document any other payment to this or any other alleged creditor. Further, Applicant failed to present documentation to show which debts were in dispute or to support a legitimate basis for the disputes. None of Applicant’s debts have been resolved.

The record lacks evidence concerning the quality of Applicant’s professional performance, the level of responsibility his duties entail, or his track record with respect to handling sensitive information and observation of security procedures. No character witnesses provided statements describing his judgment, trustworthiness, integrity, or reliability. I was unable to evaluate his credibility, demeanor, or character in person since he elected to have his case decided without a hearing.

POLICIES

When evaluating an applicant’s suitability for a security clearance, the administrative judge must consider the adjudicative guidelines (AG). In addition to brief introductory explanations for each guideline, the adjudicative guidelines list potentially disqualifying conditions (DCs) and mitigating conditions (MCs), which are to be used 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 AG ¶ 2 describing the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. According to AG ¶¶ 2(a) and 2(c), the entire process is a conscientious scrutiny of applicable guidelines in the context 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 the 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, “[t]he applicant is responsible for presenting witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by the applicant or proven by Department Counsel, and has the ultimate burden of persuasion as to obtaining a favorable clearance decision.” Section 7 of Executive Order 10865 provides: “[a]ny determination under this order adverse to an applicant shall be a determination in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.”

A person applying for access to classified information seeks to enter 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 the applicant may deliberately or inadvertently fail to protect or safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation as to potential, rather than actual, risk of compromise of classified information.

ANALYSIS

Guideline F, Financial Considerations

The security concerns under the guideline for financial considerations are set out in AG ¶ 18, which reads in pertinent part:

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.

Department Counsel asserted, and the record evidence established, security concerns under two Guideline F DCs, as set forth in AG ¶ 19:

(a) inability or unwillingness to satisfy debts; and

Applicant has a long history of delinquent debt. From 2010 to present, he accumulated 15 delinquent accounts totaling $14,916. His ongoing pattern of delinquent debt and history of inability or unwillingness to pay his lawful debts raises security concerns under DCs 19(a) and (c), and shifts the burden to Applicant to rebut, extenuate, or mitigate those concerns. The guideline includes five conditions in AG ¶ 20 that could mitigate security concerns arising from Applicant’s financial difficulties:

(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 failed to produce sufficient evidence that he has addressed his 15 delinquencies. He offered little evidence from which to establish a track record of debt resolution. While he made a payment on one debt alleged in SOR ¶ 1.k, he failed to show he fully resolved that debt. He failed to demonstrate that conditions beyond his control contributed to his financial problems or that he acted responsibly under such circumstances. He did not produce evidence that he received financial counseling. MC 20(e) requires documented proof to substantiate the basis of a dispute concerning an alleged debt, and Applicant failed to provide such evidence, despite claiming he formally disputed some of them. Accordingly, the record is insufficient to establish mitigation under any of the foregoing provisions.

WHOLE PERSON CONCEPT

Under the whole-person concept, the administrative judge must evaluate an applicant’s eligibility for a security clearance 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 a security clearance must be an overall commonsense judgment based upon careful consideration of the guidelines and the whole-person concept.

I considered the potentially disqualifying and mitigating conditions in light of all pertinent facts and circumstances surrounding this case. Applicant is an accountable adult, who is responsible for his voluntary choices and conduct that underlie the security concerns expressed in the SOR. His SOR-listed delinquent debts arose over the past five years and appear to remain unresolved despite his employment during the period involved. He offered insufficient evidence of financial counseling, rehabilitation, better judgment, or responsible conduct in other areas of his life to offset resulting security concerns. The potential for pressure, coercion, and duress from his financial situation remains undiminished. Overall, the record evidence leaves me with substantial doubt as to Applicant’s present eligibility and suitability for a security clearance. He did not meet his burden to mitigate the security concerns arising from his financial considerations.

FORMAL FINDINGS

Formal findings for or against Applicant on the allegations set forth in the SOR, as required by ¶ E3.1.25 of Enclosure 3 of the Directive, are:

Paragraph 1, Guideline F: AGAINST APPLICANT

Subparagraphs 1.a through 1.o 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.

Jennifer I. Goldstein Administrative Judge

FOOTNOTES

1 Item 3. 2 Item 2. 3Item 3. 4Item 4.