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ISCR Case 01-25376.h1 — CASE

ISCR Case 01-25376.h1denied

Case Headnote

ISCR Case No. 01-25376.h1

deniedSep 15, 2003· Hon. James A. Young· hearing

Summary

A 49-year-old electronics technician was denied a security clearance under Guideline F, Financial Considerations, due to a history of financial irresponsibility. The Statement of Reasons detailed multiple delinquent accounts, including nine accounts sent to collection ranging from $25 to $1,150, and two civil judgments for $500 and $2,076. These issues raised Disqualifying Conditions 1 and 3.

The judge determined that the applicant failed to adequately mitigate these security concerns. While Mitigating Condition 6 was considered, the applicant's financial history included two bankruptcies and numerous delinquent debts.

Ultimately, the denial was based on the applicant's consistent failure to meet financial obligations, his two bankruptcies, and his current delinquency on credit card payments, coupled with a lack of clear understanding of his financial situation.

Why the Applicant Was Denied

Applicant has a history of not meeting financial obligations.
Applicant has two bankruptcies and multiple delinquent debts.
Applicant is currently behind on credit card payments and lacks a firm understanding of his financial situation.

Conditions Referenced

Disqualifying

DC 1raisedFinancial ConsiderationsApplicant has a history of not meeting financial obligations.
DC 3raisedFinancial ConsiderationsApplicant has an inability or unwillingness to satisfy his debts.

Mitigating

MC 6rejectedFinancial ConsiderationsAlthough some debts have been paid, the applicant still faces financial difficulties.

Key Rule Quoted

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

Procedural Posture

SOR issuedJan 13, 2003
Answer filedFeb 10, 2003
Hearing heldAug 21, 2003Originally heard on April 24, 2003, but reassigned due to disqualification of the first judge.
Decision dateSep 15, 2003

Cite For

Denial of Security Clearance Due to Financial Irresponsibility Under Guideline F
Impact of Multiple Bankruptcies on Security Clearance Eligibility
Insufficient Mitigation of Financial Concerns Leading to Clearance Denial

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 has a history of financial difficulties, including multiple delinquent debts and civil judgments. The judge found that while some debts were paid, the applicant failed to sufficiently mitigate the security concerns related to his financial condition, resulting in a denial of the security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Acct to collection-$1,150 $1,150	For Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Acct to collection $737 $737	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	Telephone acct to collection $691 $691	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	Acct to collection $157 $157	For Applicant	Unspecified Financial	Unknown	—	—	—
1.e	Acct to collection $140 $140	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.f	Acct to collection from Med Center for $107 $107	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.g	Acct to collection from Med Center for $96 $96	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.h	Acct to collection $87 $87	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.i	Acct to collection $25 $25	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.j	Car-civil judgment for $500 $500	Against Applicant	Judgment Against Applicant	Unknown	—	—	—
1.l	Civil judgment-$2,076 $2,076	Against Applicant	Judgment Against Applicant	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.m–1.o	3 sub-charges — specific text not stated in this decision (against the applicant). (low confidence)	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

DATE: September 15, 2003

In re: --------------------- SSN: ----------- Applicant for Security Clearance

ISCR Case No. 01-25376 DECISION OF ADMINISTRATIVE JUDGE JAMES A. YOUNG

SYNOPSIS Applicant has a history of not meeting his financial obligations. Despite two bankruptcies, Applicant still has delinquent debts. He is currently over 30 days' behind in paying off some of his credit cards. Applicant failed to sufficiently mitigate the security concerns resulting from his financial condition. Clearance is denied.

STATEMENT OF CASE

The Defense Office of Hearings and Appeals (DOHA) declined to grant or continue a security clearance for Applicant. On 13 January 2003, DOHA issued a Statement of Reasons (SOR) under the applicable Executive Order (1) and Department of Defense Directive (2) detailing the basis for its decision-failure to meet the financial considerations (Guideline F) personnel security guideline of the Directive. Applicant answered the SOR in writing on 10 February 2003 and elected to have a hearing before an administrative judge. The case was originally heard on 24 April 2003 by another administrative judge. After the hearing, but before an opinion was written, it was determined that the administrative judge was disqualified from hearing the case. The case was assigned to me on 1 July 2003. On 21 August 2003, I convened a hearing to consider whether it is clearly consistent with the national interest to grant Applicant's security clearance. DOHA received the transcript (Tr.) of the proceeding on 2 September 2003.

FINDINGS OF FACT

Applicant is a 49-year-old electronics technician for a defense contractor. Ex. 1 at 1. In 1990, Applicant was going through a divorce. He and his estranged wife were financially overextended. She was planning to file for bankruptcy which would have left him responsible for the joint debts. Applicant joined the petition for bankruptcy under Chapter 7. Ex. 12 at 27; Ex. at 1. The couples' debts were discharged. Ex. 12 at 29. In March 1998, Applicant again had his debts discharged under Chapter 7. Ex. 12 at 30. Since the discharge of his debts in 1998, Applicant has accumulated the following delinquent debts ¶ Nature and Amount Status Record 1.a. Acct to collection-$1,150 Current wife's debt; not satisfied, but making payments Tr. 26-27 1.b. Acct to collection $737 Not satisfied; making payments, but not regularly Tr. 27 1.c. Telephone acct to collection $691 Claims he paid it; no evidence to support claim Tr. 27 1.d. Acct to collection $157 Never owed-incorrect credit report entry Ex. H; Tr. 18 1.e. Acct to collection $140 Paid Ex. 11 1.f. Acct to collection from Med Center for Unclear; appears to be paid Ex. 12 at 45 $107 1.g. Acct to collection from Med Unclear; appears to be paid Ex. 12 at 45 Center for $96 1.h. Acct to collection $87 Unclear; appears to be paid Ex. 12 at 45 1.i. Acct to collection $25 Paid Ex. 11 at 1 1.j. Car-civil judgment for $500 Paid by garnishment Tr. 29-30 1.k Apt eviction-civil judgment $624 Satisfied Dec 2001 Ex. 9 at 1 1.l. Civil judgment-$2,076 Not satisfied; making payments Tr. 30 Applicant is now "a little behind on a couple of credit cards." Tr. 32-33.

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. The President has restricted eligibility for access to classified information to United States citizens "whose personal and professional history affirmatively indicates loyalty to the United States, strength of character, trustworthiness, honesty, reliability, discretion, and sound judgment, as well as freedom from conflicting allegiances and potential for coercion, and willingness and ability to abide by regulations governing the use, handling, and protection of classified information." Exec. Or. 12968, Access to Classified Information § 3.1(b) (Aug. 4, 1995). Eligibility for a security clearance is predicated upon the applicant meeting the security guidelines contained in the Directive. Enclosure 2 of the Directive sets forth personal security guidelines, as well as the disqualifying conditions (DC) and mitigating conditions (MC) under each guideline. In evaluating the security worthiness of an applicant, the administrative judge must also assess the adjudicative process factors listed in ¶ 6.3 of the Directive. The decision to deny an individual a security clearance is not necessarily a determination as to the loyalty of the applicant. See Exec. Or. 10865 § 7. It is merely an indication that the applicant has not met the strict guidelines the President and the Secretary of Defense have established for issuing a clearance. Initially, the Government must establish, by substantial evidence, conditions in the personal or professional history of the applicant that disqualify, or may disqualify, the applicant from being eligible for access to classified information. See Egan, 484 U.S. at 531. The Directive presumes a nexus or rational connection between proven conduct under any of the disqualifying conditions listed in the guidelines and an applicant's security suitability. See ISCR Case No. 95-0611 at 2 (App. Bd. May 2, 1996). Once the Government establishes a disqualifying condition by substantial evidence, the burden shifts to the applicant to rebut, explain, extenuate, or mitigate the facts. ISCR Case No. 01-20700 at 3 (App. Bd. Dec. 19, 2002); see Directive ¶ E3.1.15. An applicant "has the ultimate burden of demonstrating that it is clearly consistent with the national interest to grant or continue his security clearance." ISCR Case No. 01-20700 at 3.

CONCLUSION

In the SOR, DOHA alleged under Guideline F that Applicant had several delinquent debts he had not satisfied (¶ 1.a. - 1.i.), three civil judgments against him that had not been satisfied (¶ 1.j. - 1.l), two bankruptcies (¶ 1.m. - 1.n.), and had failed to satisfy his debts despite having sufficient assets to do so (¶ 1.o.). An applicant who is financially overextended is at risk of having to engge in illegal acts to generate funds. Directive ¶ E2.A6.1.1. The Government established that Applicant has a history of not meeting his financial obligations (DC 1) and an inability or unwillingness to satisfy his debts (DC 3). Although several of the delinquent debts listed in the SOR have been paid (see MC 6), and the debts alleged in ¶¶ 1.a. and 1.d. may not be his, Applicant is still having financial difficulties. He has not paid off his civil judgment (¶ 1.l) and has started to fall behind on his credit card payments. Tr. 33. Applicant reported on his personal financial statement that he had a net remainder each month of over $520. Ex. 2 at 5. Apparently things have changed, but Applicant seems unsure of his financial condition. Under the circumstances, none of the mitigating conditions apply. Applicant does not have a firm understanding of his debts or his finances. Applicant has not demonstrated that it is in the national interest to grant or continue a security clearance for him. Finding is against Applicant.

FORMAL FINDINGS

The following are my conclusions as to each allegation in the SOR: 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.: Against Applicant Subparagraph 1.f.: Against Applicant Subparagraph 1.g.: Against Applicant Subparagraph 1.h.: Against Applicant Subparagraph 1.i.: Against Applicant Subparagraph 1.j.: Against Applicant Subparagraph 1.l.: Against Applicant Subparagraph 1.m.: Against Applicant Subparagraph 1.n.: Against Applicant Subparagraph 1.o.: 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 continue a security clearance for Applicant. Clearance is James A. Young Administrative Judge 1. Exec. Or. 10865, Safeguarding Classified Information within Industry (Feb. 20, 1960), as amended and modified. 2. Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (Jan. 2, 1992), as amended and modified.

FOOTNOTES

01-25376.h1 FOR GOVERNMENT Juan R. Rivera, Esq., Department Counsel FOR APPLICANT Pro Se file:///usr.osd.mil/...yComputer/Desktop/DOHA%20transfer/DOHA-Kane/dodogc/doha/industrial/Archived%20-%20HTML/01-25376.h1.html[7/2/2021 2:28:49 PM] 01-25376.h1