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ISCR 01-04256.h1: Guideline F security clearance hearing, denied (2001) · CASE

ISCR Case 01-04256.h1denied

Case headnote

ISCR Case No. 01-04256.h1

deniedNov 13, 2001· Hon. Richard A. Cefola· hearing

Summary

A 51-year-old defense contractor employee was denied a security clearance under Guideline F (Financial Considerations) due to significant past due debts. The Statement of Reasons (SOR) alleged that the applicant owed over $10,000 to seven creditors, with these debts becoming past due after a period of unemployment following surgery in August 1993.

The applicant acknowledged her financial difficulties, stating in a November 2000 sworn statement her intention to contact an attorney about filing for bankruptcy. She further affirmed in her answer to the SOR that she would file for bankruptcy by September 30, 2001.

However, the judge found that the applicant offered little in the way of mitigation and failed to take action to alleviate her financial situation despite her promises. The applicant did not sufficiently rebut the government's concerns regarding her financial reliability, leading to the denial of her security clearance.

Why the applicant was denied

The applicant has significant past due debts exceeding $10,000.
The applicant failed to take action to alleviate her financial situation despite promises to file for bankruptcy.
The applicant did not provide sufficient evidence to mitigate the government's concerns regarding her financial reliability.

Conditions referenced

Disqualifying

F.1.araisedA History of Not Meeting Financial Obligations
F.1.craisedInability or Unwillingness to Satisfy Debts

Mitigating

F.3rejectedThe Conditions That Resulted in the Behavior Were Largely Beyond the Person's Control (e.g., Loss of Employment)The applicant did not demonstrate that her financial difficulties were beyond her control or that she had taken steps to address them.

Key rule quoted

“An individual who is financially overextended is at risk of having to engage in illegal acts to generate funds.”

Procedural posture

SOR issuedAug 23, 2001
Answer filedAug 30, 2001
Hearing held—Case determined on a written record.
Decision dateNov 13, 2001

Cite for

Denial of Security Clearance Due to Significant Financial Obligations Under Guideline F
Failure to Mitigate Financial Concerns Despite Intentions to File for Bankruptcy
Importance of Taking Action to Address Financial Difficulties 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.

From the decision

Facts this decision states, each with the exact sentence it comes from. Descriptive of the record, not an assessment.

Delinquent debt cited: $10,000 (bankruptcy filed, not discharged): “The Applicant's past due indebtedness is in excess of $10,000.00.”

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 past due debts exceeding $10,000, which were not mitigated by any actions taken to resolve them, including a stated intention to file for bankruptcy. As a result, the judge ruled against the applicant under Guideline F, concluding that the financial difficulties raised security concerns that were not adequately addressed.

The sub-allegation breakdown is part of the Professional plan. See what it includes.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation

Descriptive standardized rendering of a decided public case. 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

DATE: November 13, 2001 In Re: ------------------------ SSN: ------------ Applicant for Security Clearance ISCR Case No. 01-04256 DECISION OF ADMINISTRATIVE JUDGE RICHARD A. CEFOLA

STATEMENT OF CASE

On August 23, 2001, the Defense Office of Hearings and Appeals (DOHA), pursuant to Executive Order 10865 and Department of Defense Directive 5220.6 (Directive), dated January 2, 1992, issued a Statement of Reasons (SOR) to the Applicant, which detailed reasons why DOHA could not make the preliminary affirmative finding under the Directive that it is clearly consistent with the national interest to grant or continue a security clearance for the Applicant and recommended referral to an Administrative Judge to determine whether a clearance should be denied or revoked. Applicant filed an Answer to the SOR on or about August 30, 2001. Applicant elected to have this case determined on a written record in lieu of a hearing. Department Counsel submitted the Government's File of Relevant Material (FORM) on September 25, 2001. Applicant was instructed to submit objections or information in rebuttal, extenuation or mitigation within 30 days of receipt of the FORM. Applicant received her copy on September 28, 2001, and the Applicant submitted nothing in reply. The case was received by the undersigned for resolution on October 26, 2001. The issue raised here is whether the Applicant's admitted financial difficulties militate against the granting of a security clearance.

FINDINGS OF FACT

The following Findings of Fact are based on Applicant's Answer to the SOR, the File of Relevant Material and Applicant's Response. The Applicant is 51 years of age, and is employed by a defense contractor who seeks a security clearance on behalf of the Applicant (Item 4 at page 1). Guideline F - Financial Considerations 1.a.~1.g. The Applicant is indebted to seven different creditors in excess of $10,000.00 in past due indebtedness (Item 6 at page 2, and Item 7 at pages 5–7). The Applicant avers that she was "out of work for approximately one year" due to surgery in August of 1993 (Item 6 at page 1). Her debts became past due during this period of unemployment (id). In her November 29, 2000, sworn statement she avers "It is my intention to contact an attorney regarding these debts, and inquiry(sic) about the possibility of filing bankruptcy and having these accounts discharged" (Item 6 at page 4). In her answer to the SOR the Applicant states that she "will file bankruptcy no later than 9/30/01" (Item 3). Mitigation Other than stating the genesis of her past due indebtedness, the Applicant offers little in the way of mitigation.

POLICIES

Enclosure 2 and Section E2.2. of the 1992 Directive set forth both policy factors and conditions that could raise or mitigate a security concern, and which must be given binding consideration in making security clearance determinations. The conditions should be followed in every case according to the pertinent criterion, however, the conditions are neither automatically determinative of the decision in any case, nor can they supersede the Administrative Judge's reliance on his own common sense. Because each security clearance case presents its own unique facts and circumstances, it should not be assumed that these conditions exhaust the realm of human experience, or apply equally in every case. Conditions most pertinent to evaluation of this case are: Financial Considerations Conditions that could raise a security concern and may be disqualifying include: 1. A history of not meeting financial obligations; 3. Inability or unwillingness to satisfy debts; Condition that could mitigate security concerns include: 3. The conditions that resulted in the behavior were largely beyond the person's control (e.g., loss of employment . . . ); As set forth in the Directive, each clearance decision must be a fair and impartial common sense determination based upon consideration of all the relevant and material information and the pertinent criteria and adjudication policy in enclosure 2, including as appropriate: a. Nature and seriousness of the conduct and surrounding circumstances. b. Frequency and recency of the conduct. c. Age of the applicant. d. Motivation of the applicant, and the extent to which the conduct was negligent, willful, voluntary, or undertaken with knowledge of the consequence involved. e. Absence or presence of rehabilitation. f. Probability that circumstances or conduct will continue or recur in the future. The Administrative Judge, however, can only draw those inferences or conclusions that have a reasonable and logical basis in the evidence of record. The Judge cannot draw inferences or conclusions based on evidence which is speculative or conjectural in nature. The Government must make out a case under Guideline F (Financial Considerations) which establishes doubt about a person's judgment, reliability and trustworthiness. While a rational connection, or nexus, must be shown between an applicant's adverse conduct and his ability to effectively safeguard classified information, with respect to sufficiency of proof of a rational connection, objective or direct evidence is not required. Then, the Applicant must remove that doubt with substantial evidence in refutation, explanation, mitigation or extenuation, which demonstrates that the past adverse conduct is unlikely to be repeated, and that the Applicant presently qualifies for a security clearance. An individual who is financially overextended is at risk of having to engage in illegal acts to generate funds. The Government must be able to place a high degree of confidence in a security clearance holder to abide by all security rules and regulations at all times and in all places.

CONCLUSION

The Applicant's past due indebtedness is in excess of $10,000.00. It was incurred more than seven years ago. A year ago, in her sworn statement the Applicant averred that she would pursue a bankruptcy and have her debts discharged. More recently, in her Answer to the SOR the Applicant stated she would "file bankruptcy no later than 9/30/01." Despite her promises of action, she has done nothing to alleviate the Government's concerns. Her continuing, excessive past due indebtedness is clearly of present security significance; and as such, Guideline F is found against the Applicant. Considering all the evidence, the Applicant has not rebutted the Government's case regarding her admitted financial difficulties. The Applicant has thus not met the mitigating conditions of Guideline F, and of Section E2.2. of the Directive. Accordingly, she has not met her ultimate burden of persuasion under Guideline F.

FORMAL FINDINGS

Formal Findings required by paragraph 25 of Enclosure 3 of the Directive are: Paragraph 1: AGAINST THE APPLICANT a. Against the Applicant. b. Against the Applicant. c. Against the Applicant. d. Against the Applicant. e. Against the Applicant. f. Against the Applicant. g. Against the Applicant. Factual support and reasons for the foregoing are set forth in FINDINGS OF FACT and CONCLUSIONS, supra.

DECISION

In light of 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 the Applicant. Richard A. Cefola Administrative Judge

FOOTNOTES

01-04256.h1 FOR GOVERNMENT William S. Fields, Esquire, Department Counsel FOR APPLICANT Pro Se file:///usr.osd.mil/...yComputer/Desktop/DOHA%20transfer/DOHA-Kane/dodogc/doha/industrial/Archived%20-%20HTML/01-04256.h1.html[7/2/2021 2:15:34 PM] 01-04256.h1