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ISCR 01-21030.h2: Guideline F security clearance hearing, denied (2004) · CASE

ISCR Case 01-21030.h2denied

Case headnote

ISCR Case No. 01-21030.h2

deniedJan 22, 2004· Hon. Charles D. Ablard· hearing

Summary

A 51-year-old defense contractor employee was denied a security clearance under Guideline F (Financial Considerations) due to a history of financial difficulties. These issues originated from a period of unemployment between 1996 and 1997. The Statement of Reasons detailed several debts, including an $8,638 debt settled for $1,300 in 1999, a $955 debt settled for $300 in 2003, and a $1,817 debt settled for $600 in 2000. Other debts included a $1,249 obligation paid in 2003, a $3,228 debt that was disputed and charged off, and two smaller debts of $136 and $255, both paid in 2003.

The judge found that the applicant had a history of failing to meet financial obligations, citing Disqualifying Conditions 1 and 3. Although most debts were eventually settled or paid, many were resolved only shortly before or after the security clearance hearing, indicating a lack of timely action.

The applicant's explanations for these delayed payments were deemed insufficient to mitigate the concerns raised by the financial history. Consequently, the security clearance was denied.

Why the applicant was denied

The applicant has a history of not meeting financial obligations.
Several debts were only paid shortly before or after the hearing, indicating a lack of timely resolution.
The applicant's explanations for delayed payments were not sufficient to mitigate the concerns.

Conditions referenced

Disqualifying

DC 1raisedHistory of Not Meeting Financial Obligations
DC 3raisedInability or Unwillingness to Satisfy Debts

Key rule quoted

“"No one has a 'right' to a security clearance."”
Department of the Navy v. Egan, 484 U.S. 518, 528 (1988)

Procedural posture

SOR issuedFeb 11, 2003
Answer filedApr 10, 2003Applicant requested a hearing.
Hearing heldJul 23, 2003Hearing rescheduled due to notice issues.
Decision dateSep 3, 2003Decision was remanded on January 13, 2004.

Cite for

Denial Based on Financial Considerations Under Guideline F
Impact of Delayed Debt Resolution on Security Clearance
Insufficient Mitigation of Financial Obligations Despite Employment

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.

Age at decision: 51: “Applicant, a 51-year-old employee of a defense engineering contractor, incurred debts during a period of unemployment in 1996 and 1997.”
Tenure: ~7 years: “Despite having been employed since 1997 she continues to have several debts that are in question.”
Delinquent debt cited: $8,638: “1a $8,638.00 Settled 2/22/99 for $1,300.00 Exh. D”

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 a history of not meeting financial obligations and an inability or unwillingness to satisfy debts. While some debts were settled or paid, the judge concluded that the applicant's long-standing financial issues and lack of timely resolution indicated a risk to national security, resulting in a denial of the security clearance.

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: January 22, 2004

In Re:

-----------------

SSN: -----------

Applicant for Security Clearance

CR Case No. 01-21030

REMAND DECISION OF ADMINISTRATIVE JUDGE

CHARLES D. ABLARD

SYNOPSIS

Applicant, a 51-year-old employee of a defense engineering contractor, incurred debts during a period of unemployment in 1996 and 1997. Despite having been employed since 1997 she continues to have several debts that are in question. She has paid the majority of the outstanding debts or settled them for a lesser amount but several were paid only a few days before and after her hearing. While most of the debts have been paid and others were settled, the fact that she failed to resolve these obligations for so long a time indicates a history of failure to meet her obligations. Clearance is denied.

STATEMENT OF CASE

On February 11, 2003, the Office of Hearings and Appeals (DOHA) pursuant to Executive Order 10865, Safeguarding Information Within Industry, as amended and modified, and Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (Directive), dated January 2, 1992, as amended and modified, issued a Statement of Reasons (SOR) to 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 Applicant. DOHA recommended the case be referred to an administrative judge to determine whether a clearance should be granted, continued, denied, or revoked.

In a sworn written statement, dated April 10, 2003, Applicant responded to the allegations set forth in the SOR, and requested a hearing. Department Counsel submitted the Government's written case on August 30, 2003. The case was assigned to another Administrative Judge who could not hold the hearing and it was reassigned to me on May 8, 2003. An extension of time was requested by the Applicant because of the death of her father and the hearing was scheduled for June 3, 2003. Because the notice of hearing was improperly made, the hearing was rescheduled again by notice of hearing dated July 7, 2003 and set for July 23, 2003. It was held on that day.

The Government introduced seven exhibits and the Applicant introduced six at the hearing. All were admitted into evidence. The record was held open for submission of additional information until August 6, 2003. One additional document with ten attachments was received on August 4, 2003, and a second with an attached letter was received on August 6, 2003. A third was received after the close of the record on August 11, 2003, but was considered and admitted in evidence. The transcript was received on August 5, 2003. On September 3, 2003, I issued a decision denying Applicant a clearance. She appealed and on January 13, 2004, the Appeal Board remanded the case to me with instructions to issue a new decision that sets forth specific findings of fact as to each of the debts alleged in the SOR to eliminate the vagueness and uncertainty identified by the Board.

FINDINGS OF FACT

Applicant has admitted all but one of the factual allegations pertaining to financial considerations under Guideline F while qualifying the admissions with information about the individual debts and their repayment. Those admissions are incorporated herein as findings of fact. After a complete review of the evidence in the record and upon due consideration of the record the following additional findings of fact are made.

Applicant is a 51-year-old training officer with a defense contractor working with personnel of the Department of the Army. She is a graduate of a leading university and has been employed by the same company since 1997. Her monthly salary is over $6,000.00 and she has no dependents. (Tr. 46) She has accumulated a retirement account of almost $40,000.00.

In 1996 she lost her job as a result of downsizing by her former employer and remained unemployed for approximately eighteen months. During that time she incurred debts for a variety of expenses. Most of these debts have now been paid or settled but one is still outstanding (Exh. H) Several of those paid were reported paid only a few days before the hearing (Exh. A-D) and three after the hearing (Exh. G1, 2 and 3).

In 2002 Applicant consulted with a credit counseling service and was advised to pursue the accounts on her own which she did (TR. 33).

The status of the debts is as follows keyed to the paragraph numbers in the SOR:

1a $8,638.00 Settled 2/22/99 for $1,300.00 Exh. D

1b $955.00 Settled 7/22/03 for $300.00 Exh. B

1c $1,249.00 Paid 7/30/03 Exh. G1

1d $1,817.00 Settled 3/16/00 for $600.00 Exh. E

1e Same debt as 1a

1f $3,228.00 Disputed and Charged off Exh. I

1g Same debt as 1d

1h $136.00 Paid on 7/25/03 Exh. G2

1i $255.00 Paid on 7/24/03 Exh. G3

1j $426.00 Disputes and is pursuing Exh. I

Aside from the two debts that were settled in 1999 and 2000, very little was achieved to pay the debts until the eve of the hearing and thereafter. After Applicant's statement to the investigator was taken in October 2000 several letters were sent to creditors in November 2002 but the records were stale after so many years (Exh. 6). Applicant is still corresponding with at least one creditor (Exh. I).

Applicant is active in her church and serves as an officer of the church. She shows strong concern and interest in the activities and achievements of her family (TR 54 and 55).

POLICIES

[N]o one has a 'right' to a security clearance." Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). As Commander in Chief, the President has "the authority to control access to information bearing on national security and to determine whether an individual is sufficiently trustworthy to occupy a position that will give that person access to such information." Id. at 527.

An evaluation of whether the applicant meets the security guidelines includes consideration of the following factors: (1) the nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the conduct; (3) the frequency and recency of the conduct; (4) the individual's age and maturity at the time of the conduct; (5) the voluntariness of participation; (6) the presence or absence of rehabilitation and other 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.

Directive, ¶ E2.2.1. Security clearances are granted only when "it is clearly consistent with the national interest to do so." Executive Order No. 10865 § 2. See Executive Order No. 12968 § 3.1(b).

Initially, the Government must establish, by something less than a preponderance of the evidence, that conditions exist in the personal or professional history of the applicant which disqualify, or may disqualify, the applicant from being eligible for access to classified information See Egan, 484 U.S. at 531. The applicant then bears the burden of demonstrating that it is clearly consistent with the national interest to grant or continue the applicant's clearance. "Any doubt as to whether access to classified information is clearly consistent with national security will be resolved in favor of the national security." Directive, ¶ E2.2.2. "[S]ecurity clearance determinations should err, if they must, on the side of denials." Egan, 484 U.S. at 531. See Executive Order No. 12968 § 3.1(b)

The applicable Guideline cited in the SOR concern the following Disqualifying Conditions (DC):Financial Considerations Guideline F:

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

Conditions that could raise a security concern and may be disqualifying include a history of not meeting financial obligations (DC 1) or an inability or unwillingness to satisfy debts (DC 3).

Conditions that could mitigate security concerns include the fact that the behavior was largely beyond the person's control (MC 3), that she has received counseling and the problem is being resolved (MC 4), or that she has initiated good faith effort to repay creditors and resolve the debts (MC 6).

CONCLUSION

In light of the Appeal Board Remand Order, upon reconsideration of all the facts in evidence, and after application of all appropriate legal precepts, factors and conditions above, I conclude the following with respect to all allegations set forth in the SOR.

Based on the evidence of record, including Applicant's admissions, the Government has established reasons to deny her a security clearance because of financial considerations under Guideline F (DC 1 and DC 3) in that she has a history of not meeting financial obligations and an inability or unwillingness to satisfy them. Having established such reasons, the Applicant has the burden to establish security suitability through evidence which refutes, mitigates, or extenuates the disqualification and demonstrates that it is clearly consistent with the national interest to grant a security clearance. ISCR Case No. 99-0424 (App. Bd. Feb. 8, 2001)

Applicant advanced a number of reasons for not paying her debts sooner including the death of her mother and her responsibility for accounts held jointly by them complicated by the fact that both had the same name, a flood in her basement that destroyed credit records making it difficult for her to contact creditors, the death of her father in the last month, and the difficulty of tracing the debts that had been turned over to credit collection agencies or bought by other credit agencies.

All of these circumstances might well be true and have contributed to her problems but the undisputed fact is that she has been employed in a well paid job for the past six years without effective resolution of her outstanding debts. While she did settle two of the debts for lesser amounts in 1999 and 2000 respectively (SOR 1a and 1d), other debts were not paid until the SOR was issued, one was paid one day before the hearing (SOR 1b), and three more were not paid until after the conclusion of the hearing (SOR 1c, h, and i).

It is difficult to believe that more could not have been done in the six year period between the time her unemployment ended with her present employment and the hearing in this matter. Even after the interview of the investigator in October, 2000, the Applicant did not show sufficient progress towards settling the remaining accounts which were brought to her attention in a serious way. Thus, none of the Mitigating Conditions can be applied to the facts in this case.

FORMAL FINDINGS

Formal findings as required by the Directive (Par. E3.1.25) are as follows:

Paragraph 1. Guideline F: AGAINST APPLICANT

Subparagraph 1.a.: For Applicant

Subparagraph 1.b.: Against Applicant

Subparagraph 1.c.: Against Applicant

Subparagraph 1.d.: For Applicant

Subparagraph 1.e.: For Applicant

Subparagraph 1.f.: Against Applicant

Subparagraph 1.g.: For Applicant

Subparagraph 1.h.: Against Applicant

Subparagraph 1.i.: Against Applicant

Subparagraph 1.k.: Against Applicant

DECISION

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 or renew a security clearance for Applicant. Clearance is denied.

Charles D. Ablard

Administrative Judge

FOOTNOTES

01-21030.h2 FOR GOVERNMENT Kathryn Antigone Trowbridge, Esq., Department Counsel FOR APPLICANT Pro Se file:///usr.osd.mil/...yComputer/Desktop/DOHA%20transfer/DOHA-Kane/dodogc/doha/industrial/Archived%20-%20HTML/01-21030.h2.html[7/2/2021 2:26:05 PM] 01-21030.h2