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ISCR Case 04-09051.h1 — CASE

ISCR Case 04-09051.h1denied

Case Headnote

ISCR Case No. 04-09051.h1

deniedApr 28, 2006· Hon. Philip S. Howe· hearing

Summary

A 49-year-old divorced defense contractor was denied a security clearance under Guideline F (Financial Considerations) due to 15 delinquent debts totaling $161,544. The Statement of Reasons (SOR) detailed these obligations, which included various credit cards, bank loans, and financial lender debts. One significant debt of $44,386 was noted as being in the foreclosure process.

The applicant's net monthly income remainder was $1,683. Disqualifying conditions E2.A6.1.2.1 and E2.A6.1.2.3 were raised, indicating a history of not meeting financial obligations and an inability or unwillingness to satisfy debts.

The denial was based on the applicant's failure to provide any evidence addressing the resolution of these 15 delinquent debts. He did not meet his burden of proof regarding his financial obligations, leading to the final decision to deny his security clearance.

Why the Applicant Was Denied

Applicant has 15 delinquent debts totaling $161,544, which he did not address or resolve.
He provided no evidence directly related to the debts listed in the Statement of Reasons (SOR).
The applicant failed to meet his burden of proof regarding financial obligations.

Conditions Referenced

Disqualifying

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

Key Rule Quoted

“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.

Procedural Posture

SOR issuedJun 2, 2005
Answer filedSep 23, 2005Applicant requested decision on written record.
Hearing held—No hearing; decided on written record.
Decision dateApr 28, 2006

Cite For

Failure to Mitigate Financial Obligations Under Guideline F
Burden of Proof on Applicant Regarding Financial Issues
Lack of Evidence Addressing Specific Debts in SOR

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 15 delinquent debts totaling $161,544, which he failed to address adequately in his response. The judge found that the applicant did not provide sufficient evidence to mitigate the financial concerns, resulting in a denial of his security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	$10,205 credit card $10,205	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	$3,990 financial lender $3,990	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	$1,439 credit card $1,439	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	$5,192 financial lender $5,192	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	$3,411 bank $3,411	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	$9,357 financial lender $9,357	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	$3,229 financial lender $3,229	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	$4,629 collector for financial lender $4,629	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	$11,323 credit corporation lender $11,323	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.j	$3,474 bank lender $3,474	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.k	$51,717 financial lender $51,717	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.l	$3,211 bank lender $3,211	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.m	$2,046 bank lender $2,046	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.n	$3,935 finance company lender $3,935	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.o	$44,386 financial lender now in foreclosure process $44,386	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.p	$1,683 net monthly income remainder $1,683	Against Applicant	Personal Loan Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—

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

SYNOPSIS

KEYWORD: Financial

DIGEST: Applicant is 49 years old, divorced, and works for a defense contractor. He has 15 delinquent debts alleged in the SOR, with a total value of $161,544. Applicant did not submit any evidence specifically addressing his resolution, if any, of these 15 debts. Applicant failed in his burden of proof and did not mitigate the financial considerations security concern. Clearance is denied.

CASENO: 04-09051.h1

DATE: 04/28/2006

DATE: April 28, 2006

In re:

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

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

Applicant for Security Clearance

ISCR Case No. 04-09051

DECISION OF ADMINISTRATIVE JUDGE

PHILIP S. HOWE SYNOPSIS

Applicant is 49 years old, divorced, and works for a defense contractor. He has 15 delinquent debts alleged in the SOR, with a total value of $161,544. Applicant did not submit any evidence specifically addressing his resolution, if any, of these 15 debts. Applicant failed in his burden of proof and did not mitigate the financial considerations security concern. 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 June 2, 2005, DOHA issued a Statement of Reasons (1) (SOR) detailing the basis for its decision-security concerns raised under Guideline F (Financial Considerations) of the Directive. Applicant answered the SOR in writing on September 23, 2005. Applicant requested his case be decided on the written record in lieu of a hearing.

On November 7, 2005, Department Counsel submitted the Department's written case. A complete copy of the file of relevant material (FORM) was provided to the Applicant. He was given the opportunity to file objections and submit material in refutation, extenuation, or mitigation. Applicant filed a response to the FORM on or before December 23, 2005, within the 30 day time allowed. On March 6 and 13, 2006, Applicant submitted additional documentation in support of his response. The case was assigned to me on March 23, 2005.

FINDINGS OF FACT

Applicant's admissions to the SOR allegations are incorporated here as findings of fact. After a complete and thorough review of the evidence in the record, and full consideration of that evidence, I make the following additional findings of fact: Applicant is 49 years old, divorced, and works for a defense contractor. Applicant has 15 delinquent debts totaling $161,544 due and owing. He hired an attorney in 2004 to represent him in his various debt resolution matters. (Items 2 and 3)

Applicant's response includes copies of his attorney's letters to various creditors not listed in the SOR, copies of checks not related to the SOR alleged debts, and other documents pertaining to delinquent debts not listed on the SOR. Applicant denied owing the debts listed in subparagraphs 1.a, 1.f, 1.h, 1.n., 1.o, 1p. He admitted the other 10 delinquent debts. (Answer in Item 2, Response and attached exhibits)

Applicant did not submit any documentation or statement directly responding to any of the delinquent debts listed in the SOR. All the listed debts remain delinquent. The debt amounts, types of creditors, and evidence showing the debt and current delinquency are as follows:

DEBT AMOUNT CREDITOR RECORD TYPE EVIDENCE 1.a. $10,205 credit card Credit reports, Items 6, 7 1.b. $3,990 financial Applicant's lender statement and credit reports, Items 5, 7, 8 1.c. $1,439 credit card Applicant's statement, credit reports, Items 5-8 1.d. $5,192 financial Applicant's lender statement, credit reports, Items 5-8, Applicant's exhibit H 1.e. $3,411 bank Applicant's statement, credit reports, Items 5-8 1.f. $9,357 financial Credit reports, Items lender 6, 7 1.g. $3,229 financial Applicant's lender statement, credit reports, Items 5-7 1.h. $4,629 collector for Credit reports, Items financial 6, 7 lender 1.i. $11,323 credit Credit reports, Items corporation 6-8 lender 1.j. $3,474 bank lender Credit reports, Items 6-8 1.k. $51,717 financial Credit reports, Items lender 6, 7; Applicant's exhibit F 1.l. $3,211 bank lender Credit reports, Item 8, Applicant's statement, Item 5 l.m. $2,046 bank lender Credit reports, Items 6-8; Applicant's statement, Item 5 1.n. $3,935 finance Credit report Item 8; company Applicant's lender statement, Item 5 1.o. $44,386 financial Credit reports, Items lender now in 6, 7 foreclosure process 1.p. $1,683 net monthly income remainder, showing Applicant paying only one personal Applicant's debt at that time. His remainder could have paid several smaller debts over a one financial statement, Item 5 or two year period, but he did not submit any evidence he used that money to statement of make those payments. February 18, 2004

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 authorized the Secretary of Defense or his designee to grant applicants eligibility for access to classified information "only upon a finding that it is clearly consistent the national interest to do so." Exec. Or. 10865, Safeguarding Classified Information with Industry

§ 2 (Feb. 20, 1960). Eligibility for a security clearance is predicated upon the applicant meeting the security guidelines contained in the Directive. 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.

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. Enclosure 2 of the Directive sets forth personnel security guidelines, as well as the disqualifying conditions (DC) and mitigating conditions (MC) under each guideline that must be carefully considered in making the overall common sense determination required.

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. Those assessments include: (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). Because each security case presents its own unique facts and circumstances, it should not be assumed that the factors exhaust the realm of human experience or that the factors apply equally in every case. Moreover, although adverse information concerning a single condition may not be sufficient for an unfavorable determination, the individual may be disqualified if available information reflects a recent or recurring pattern of questionable judgment, irresponsibility, or other behavior specified in the Guidelines.

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. 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. ay 2, 1996). All that is required is proof of facts and circumstances that indicate an applicant is at risk for mishandling classified information, or that an applicant does not demonstrate the high degree of judgment, reliability, or trustworthiness required of persons handling classified information. ISCR Case No. 00-0277, 2001 DOHA LEXIS 335 at **6-8 (App. Bd. 2001). Once the Government has established a prima facie case by substantial evidence, the burden shifts to the applicant to rebut, explain, extenuate, or mitigate the facts. See Directive ¶ E3.1.15. An applicant "has the ultimate burden of demonstrating that is clearly consistent with the national interest to grant or continue his security clearance. ISCR Case No. 01-20700 at 3 (App. Bd. 2002). "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 Exec. Or. 12968 § 3.1(b).

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: The Concern: An individual who is financially overextended is at risk of having to engage in illegal acts to generate funds. E2.A6.1.1

CONCLUSION

The Government established by substantial evidence and Applicant's admissions each of the allegations in the SOR. Applicant provided no evidence directly related to any of the SOR allegations. The evidence he submitted pertained to debts not listed in the SOR.

The Disqualifying Conditions (DC) 1 (A history of not meeting financial obligations E2.A6.1.2.1) and DC 3 (Inability or unwillingness to satisfy debts E2.A6.1.2.3) apply. Applicant has 15 delinquent debts alleged in the SOR. He provided no evidence addressing those specific debts and his plan to pay, settle, or otherwise resolve them. He provided documents pertaining to delinquent debts not alleged in the SOR.

The burden of proof is on Applicant, and nothing he provided persuaded me that the 15 delinquent debts about which the Government is concerned have been paid in full, settled, or subject to an installment agreement. He ignored those 15 debts in his Answer to the SOR and his Response to the FORM. I examined each of his documents before I came to this conclusion. Therefore, I conclude no Mitigating Conditions apply, and resolve this financial considerations security concern 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: Against Applicant

Subparagraph 1.b: Against Applicant Subparagraph 1.c: Against Applicant

Subparagraph 1.d: Against 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.k: Against Applicant

Subparagraph 1.l: Against Applicant

Subparagraph 1.m: Against Applicant

Subparagraph 1.n: Against Applicant

Subparagraph 1.o: Against Applicant

Subparagraph 1.p: Against Applicant

DECISION

In light of all of the circumstances presented by the record in this case, it is not clearly consistent with the interests of national security to grant or continue a security clearance for Applicant. Clearance is denied.

Philip S. Howe

Administrative Judge

1. Pursuant to Exec. Or. 10865, Safeguarding Classified Information within Industry (Feb. 20, 1960), as amended and modified, and Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (Jan. 2, 1992), as amended and modified (Directive).

FOOTNOTES

APPEARANCES

FOR GOVERNMENT Eric H. Borgstrom, Esq., Department Counsel file:///usr.osd.mil/...yComputer/Desktop/DOHA%20transfer/DOHA-Kane/dodogc/doha/industrial/Archived%20-%20HTML/04-09051.h1.htm[7/2/2021 3:34:58 PM] FOR APPLICANT Pro Se