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ISCR Case 02-23925.h1 — CASE

ISCR Case 02-23925.h1denied

Case Headnote

ISCR Case No. 02-23925.h1

deniedFeb 3, 2004· Hon. Martin H. Mogul· hearing

Summary

A 40-year-old defense contractor was denied a security clearance under Guideline F, Financial Considerations, due to a substantial history of financial difficulties. The Statement of Reasons detailed thirteen specific allegations of unpaid debts, totaling over $52,000. These included amounts ranging from $64 to $33,573, all of which remained unpaid at the time of the decision.

The applicant admitted to all allegations of financial irresponsibility and cited personal circumstances as contributing to his financial issues. However, the adjudicator determined that the applicant failed to establish sufficient mitigation to overcome the disqualifying conditions, specifically citing a history of not meeting financial obligations and an inability or unwillingness to satisfy debts.

Despite the application of a mitigating condition, it was deemed insufficient to outweigh the severity of the disqualifying conditions. Consequently, the decision concluded that granting a security clearance was not consistent with the national interest.

Why the Applicant Was Denied

Applicant has over $52,000 in overdue debt, all of which remain unpaid.
Applicant admitted to all allegations of financial irresponsibility in the SOR.
Mitigating conditions were not sufficient to outweigh the disqualifying conditions.

Conditions Referenced

Disqualifying

E2.A6.1.2.1raisedA History of Not Meeting Financial Obligations.
E2.A6.1.2.3raisedInability or Unwillingness to Satisfy Debts.

Mitigating

E2.A6.1.3.3appliedThe Conditions That Resulted in the Behavior Were Largely Beyond the Person's Control.Applicant's financial issues were partially due to circumstances beyond his control, such as job loss and increased family responsibilities.

Key Rule Quoted

“"the clearly consistent standard indicates that security-clearance determinations should err, if they must, on the side of denials."”
— Department of the Navy v. Egan, 484 U.S. 518, 531 (1988)

Procedural Posture

SOR issuedJun 9, 2003
Answer filedJun 17, 2003Applicant requested decision on the written record.
Hearing held—No hearing was held; decision made on the written record.
Decision dateFeb 3, 2004

Cite For

Denial of Security Clearance Due to Significant Financial Obligations Under Guideline F
Impact of Financial Irresponsibility on Security Clearance Eligibility
Consideration of Mitigating Circumstances in Financial 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 F · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The applicant has a significant history of financial difficulties, with over $52,000 in overdue debts, none of which have been resolved. The judge ruled against the applicant on all financial allegations, concluding that the applicant's financial irresponsibility and inability to satisfy debts raised security concerns under Guideline F.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	$1,260 unpaid $1,260	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.b	$1,960 unpaid $1,960	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.c	$1,631 unpaid $1,631	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.d	$3,382 unpaid $3,382	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.e	$240 unpaid $240	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.f	$3,306 unpaid $3,306	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.g	$2,435 unpaid $2,435	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.h	$1,207 unpaid $1,207	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.i	$1,581 unpaid $1,581	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.j	$64 unpaid $64	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.k	$829 unpaid $829	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.l	$962 unpaid $962	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—
1.m	$33,573 unpaid $33,573	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability	—	—

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: February 3, 2004

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

ISCR Case No. 02-23925 DECISION OF ADMINISTRATIVE JUDGE MARTIN H. MOGUL

SYNOPSIS Applicant has had a history of financial difficulties. He currently has more than $52,000 in overdue debt. None of his past overdue debts have been resolved. Mitigation has not been established. Clearance is denied.

STATEMENT OF CASE

On June 9, 2003, the Defense Office of Hearings and Appeals (DOHA), under Executive Order 10865, Safeguarding Classified Information Within Industry, dated February 20, 1960, 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. The SOR 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, and recommended referral to an Administrative Judge to conduct proceedings and determine whether clearance should be granted or denied. In a signed and sworn statement, dated June 17, 2003, Applicant responded to the SOR allegations. He requested that his case be decided on the written record in lieu of a hearing. On September 9, 2003, Department Counsel prepared the Department's written case. A complete copy of the file of relevant material (FORM) was provided to Applicant, and he was given the opportunity to file objections and submit material in refutation, extenuation, or mitigation. Applicant filed no response to the FORM. The case was assigned to this Administrative Judge on October 27, 2003. Department Counsel offered six documentary exhibits (Exhibits 1-6), which were admitted without objection. Applicant offered no documentary evidence into the record.

FINDINGS OF FACT

In the SOR, the Government alleges that a security risk may exist under Adjudicative Guideline F (Financial Considerations) of the Directive. The SOR contains 13 allegations, 1.a. through 1.m., under Guideline F. In his response to the SOR, Applicant admits all of the allegations. These allegations are incorporated as findings of fact. After a complete and thorough review of the evidence in the record, including Applicant's Answer to the SOR and the admitted documents, and upon due consideration of that evidence, I make the following additional findings of fact: Applicant is a 40 year old employee of a defense contractor who seeks access to classified information. He is married and has three stepchildren. He received an Associates Degree from a technical college in 1994. (Guideline F - Financial Considerations) The SOR lists 13 debts that Applicant owed as of March 21, 2002, 1.a. through 1.munder Adjudicative Guideline F . In his June 17, 2003 response to the SOR, Applicant admitted owing these debts. The total owed by Applicant was approximately $52,430. These debts were all long overdue, most for several years. The evidence establishes that Applicant (1) was indebted in the amounts alleged, and (2) all of the debts were delinquent as of June 2003. The table below presents details about each debt as they were listed in the SOR: Debt Amount Owed Current Status Record 1.a $1,260 unpaid Exhibits 3, 5, 6 1.b. $1,960 unpaid Exhibits 3, 5, 6 1.c. $1,631 unpaid Exhibits 3, 5, 6 1.d. $3,382 unpaid Exhibits 3, 5, 6 1.e. $ 240 unpaid Exhibits 3, 5, 6 1.f. $3,306 unpaid Exhibits 3, 5, 6 1.g. $2,435 unpaid Exhibits 3, 5, 6 1.h. $1,207 unpaid Exhibits 3, 5, 6 1.i. $1,581 unpaid Exhibits 3, 5, 6 1.j. $64 unpaid Exhibits 3, 5, 6 1.k. $829 unpaid Exhibits 3, 5, 6 1.l. $962 unpaid Exhibits 3, 5, 6 1.m. $33,573 unpaid Exhibits 3, 5, 6 Applicant stated that he has begun making payments of $60 a month on a debt of $4,500, which I do not see listed on the SOR (Exhibit 3). There is no evidence how much he has paid on this overdue debt. Applicant explained that his debts resulted from several factors. These included: 1) he and his wife were living above their means, primarily with credit cards; 2) he was laid off from his job, was unemployed for a period of time, and his subsequent employment did not pay him as well; 3) his three stepchildren came to live with him and his wife, which increased his debt significantly (Exhibit 6).

POLICIES

Enclosure 2 of the Directive sets forth adjudicative guidelines that must be carefully considered in evaluating an individual's security eligibility and making the overall common sense determination required. The Administrative Judge must take into account the conditions raising or mitigating security concerns in each area applicable to the facts and circumstances presented. Although the presence or absence of a particular condition for or against clearance is not determinative, the specific adjudicative guidelines should be followed whenever a case can be measured against this policy guidance, as the guidelines reflect consideration of those factors of seriousness, recency, motivation, etc. The adjudication process is based on the whole person concept. All available, reliable information about the person, past and present, is to be taken into account in reaching a decision as to whether a person is an acceptable security risk. Each adjudicative decision must also include an assessment of: (1) the nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the conduct, and the extent of knowledgeable participation; (3) how recent and frequent the behavior was; (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 pertinent 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 (See Directive, Section E2.2.1. of Enclosure 2). Based upon a consideration of the evidence as a whole, I find the following adjudicative guidelines most pertinent to an evaluation of the facts of this case: Guideline F - Financial Considerations E2.A6.1.1. The Concern: An individual who is financially overextended is at risk of having to engage in illegal acts to generate funds. Unexplained affluence is often linked to proceeds from financially profitable criminal acts. E2.A6.1.2. Conditions that could raise a security concern and may be disqualifying include: E2.A6.1.2.1. A history of not meeting financial obligations. E2.A6.1.2.3 Inability or unwillingness to satisfy debts. E2.A6.1.3. Condition that could mitigate security concerns include: E2.A6.1.3.3. The conditions that resulted in the behavior were largely beyond the person's control (e.g., loss of employment, a business downturn, unexpected medical emergency, or a death, divorce or separation). BURDEN OF PROOF Initially, the Government must prove controverted facts alleged in the Statement of Reasons. If the Government meets that burden, the burden of persuasion then shifts to Applicant to establish his security suitability through evidence of refutation, extenuation or mitigation sufficient to demonstrate that, despite the existence of disqualifying conduct, it is nevertheless clearly consistent with the national interest to grant or continue the security clearance. Assessment of Applicant's fitness for access to classified information requires evaluation of the whole person, and consideration of such factors as the recency and frequency of the disqualifying conduct, the likelihood of recurrence, and evidence of rehabilitation. A person who seeks access to classified information enters into a fiduciary relationship with the U.S. Government that is predicated upon trust and confidence. Where facts proven by the Government raise doubts about Applicant's judgment, reliability, or trustworthiness, Applicant has a heavy burden of persuasion to demonstrate that he is nonetheless security worthy. As noted by the United States Supreme Court in Department of the Navy v. Egan, 484 U.S. 518, 531 (1988), "the clearly consistent standard indicates that security-clearance determinations should err, if they must, on the side of denials."

CONCLUSION

Having considered the evidence of record in light of the appropriate legal precepts and factors, I conclude the following with respect to guideline F: The Government has established its case under Guideline F. The record evidence clearly establishes Applicant's indebtedness and his current non-payment of all of the debts listed on the SOR. Applicant's overall conduct pertaining to his financial obligations falls within Financial Considerations Disqualifying Condition (DC) E2.A6.1.2.1., and DC E2.A6.1.2.3., because of Applicant's history of not meeting financial obligations and his inability to satisfy his debts. Regarding Mitigating Condition (MC) E2.A6.1.3.3, which regards debts that result from circumstances beyond the person's control, I find it applicable to this case, but not controlling. While Applicant's indebtedness was partially due to circumstances beyond his control, specifically Applicant's career problems and the fact that his three step children came to live with Applicant and his was wife, Applicant's debts also occurred as a result of his own conduct of financial irresponsibility. Until Applicant can satisfy his overdue debts and establish a record of financial responsibility and stability, security concerns will continue to exist under Guideline F. I resolve Guideline F. against Applicant, and I conclude Applicant has not established, at this time, that it is "clearly consistent with the national interest" that he should be granted the privilege of a security clearance.

FORMAL FINDINGS

Formal Findings as required by Section E3.1.25 of Enclosure 3 of the Directive are hereby rendered as follows: Paragraph 1, Financial Considerations: Against the Applicant Subparagraph 1.a.: Against the Applicant Subparagraph 1.b.: Against the Applicant Subparagraph 1.c.: Against the Applicant Subparagraph 1.d.: Against the Applicant Subparagraph 1.e.: Against the Applicant Subparagraph 1.f.: Against the Applicant Subparagraph 1.g.: Against the Applicant Subparagraph 1.h.: Against the Applicant Subparagraph 1.i.: Against the Applicant Subparagraph 1.j.: Against the Applicant Subparagraph 1.k.: Against the Applicant Subparagraph 1.l.: Against the Applicant Subparagraph 1.m.: Against the Applicant

DECISION

In light of all the circumstances and facts 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. Martin H. Mogul Administrative Judge

FOOTNOTES

02-23925.h1 FOR GOVERNMENT Jennifer I. Campbell, Department Counsel FOR APPLICANT Pro Se file:///usr.osd.mil/...omputer/Desktop/DOHA%20transfer/DOHA-Kane/dodogc/doha/industrial/Archived%20-%20HTML/02-23925.h1.html[6/24/2021 11:05:30 AM] 02-23925.h1