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ISCR Case 05-03559.h1 — CASE

ISCR Case 05-03559.h1denied

Case Headnote

ISCR Case No. 05-03559.h1

deniedJan 26, 2006· Hon. James A. Young· hearing

Summary

A 43-year-old transportation supervisor was denied a security clearance under Guideline F (Financial Considerations) due to over $18,000 in delinquent debts. The Statement of Reasons detailed multiple financial issues, including several debts totaling more than $13,900 that were in collection status, and multiple debts totaling more than $4,400 that had been charged off.

The applicant's financial history indicated a pattern of not meeting obligations. While payments were being made on one of the larger debts, the remaining debts were not resolved or addressed with a clear plan.

Ultimately, the decision concluded that the applicant was unable or unwilling to satisfy his debts. Only one mitigating condition was applied to a single debt, leaving the majority of the financial concerns unmitigated, leading to the denial of the security clearance.

Why the Applicant Was Denied

Applicant has a history of not meeting financial obligations.
Applicant is unable or unwilling to satisfy his debts.
Only one mitigating condition applied to one debt, while the others remained unresolved.

Conditions Referenced

Disqualifying

E2.A6.1.2.1raisedFinancial Considerations - History of Not Meeting Financial Obligations
E2.A6.1.2.3raisedFinancial Considerations - Unable or Unwilling to Satisfy Debts

Mitigating

E2.A6.1.3.6appliedFinancial Considerations - Good Faith Effort to Repay Overdue DebtsApplicant established a payment plan for one debt.

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 issuedJul 27, 2005
Answer filedAug 9, 2005
Hearing heldDec 8, 2005
Decision dateJan 26, 2006

Cite For

Financial Overextension as a Security Concern Under Guideline F
Importance of Resolving Delinquent Debts for Security Clearance
Good Faith Efforts in Debt Repayment as a Mitigating Factor

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 multiple delinquent debts totaling over $18,000, with only one debt being addressed through a payment plan. The judge found that the applicant failed to mitigate the financial concerns, resulting in a denial of the security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Delinquent debts totaling more than $13,900 that were in collection status	Against Applicant	Unspecified Financial	Admitted	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.b	Delinquent debts totaling more than $4,400 that had been charged off	Against Applicant	Unspecified Financial	Admitted	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.c	Delinquent debts totaling more than $4,400 that had been charged off	Against Applicant	Unspecified Financial	Admitted	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.d	Delinquent debts totaling more than $4,400 that had been charged off	Against Applicant	Unspecified Financial	Admitted	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.e	Delinquent debts totaling more than $13,900 that were in collection status	Against Applicant	Unspecified Financial	Admitted	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.f	Making payments on one of the larger debts $5,720	For Applicant	Unspecified Financial	Admitted	—	(c) received/receiving counseling; problem being resolved	Credited Payment Plan with Creditor
1.g	Delinquent debts totaling more than $13,900 that were in collection status	Against Applicant	Unspecified Financial	Admitted	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.h	Delinquent debts totaling more than $4,400 that had been charged off	Against Applicant	Unspecified Financial	Admitted	(b) unwillingness to satisfy debts regardless of ability (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 and his wife overextended themselves financially in 2001. They have eight delinquencies from that period totaling more than $18,000. They are making payments on one of the larger debts, but failed to resolve or make plans to resolve the others. Clearance is denied.

CASENO: 05-03559.h1

DATE: 01/26/2006

DATE: January 26, 2006

In re:

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

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

Applicant for Security Clearance

ISCR Case No. 05-03559

DECISION OF ADMINISTRATIVE JUDGE

JAMES A. YOUNG SYNOPSIS

Applicant and his wife overextended themselves financially in 2001. They have eight delinquencies from that period totaling more than $18,000. They are making payments on one of the larger debts, but failed to resolve or make plans to resolve the others. Clearance is denied.

STATEMENT OF CASE

The Defense Office of Hearings and Appeals (DOHA) declined to grant or continue a security clearance for Applicant. In accordance with Department of Defense Directive 5220.6 ¶ E3.1.2 (Jan 2. 1992), as amended, DOHA issued a Statement of Reasons (SOR) on 27 July 2005 detailing the basis for its decision-security concerns raised under Guideline F (Financial Considerations) of the Directive. Applicant answered the SOR in writing on 9 August 2005 and elected to have a hearing before an administrative judge. The case was assigned to me on 27 October 2005. On 8 December 2005, I convened a hearing to consider whether it is clearly consistent with the national interest to grant or continue a security clearance for Applicant. DOHA received the hearing transcript (Tr.) on 19 December 2005.

I kept the record open until 21 December to give Applicant an opportunity to submit additional documents. He did not submit any.

FINDINGS OF FACT

Applicant is a 43-year-old transportation supervisor for a defense contractor. He is in charge of shipping/receiving and all of the company's vehicles. He is married and has two stepchildren at home. His wife works as an administrative assistant at a bank. Applicant currently holds a security clearance.

Applicant and his wife married in 1995. In 2001, they found themselves unable to pay their outstanding debts after their monthly expenses were paid. In 2002, they began coordinating their expenses, but still had difficulty paying their debts. In August 2004, they came to a new arrangement and are now effectively managing their monthly expenses. Applicant makes about $45,000 a year. His wife makes approximately $30,000 a year. Applicant's wife's ex-husband pays them about $300 a month in child support.

In the SOR, DOHA alleged Applicant had four delinquent debts totaling more than $13,900 in collection status and four delinquencies totaling more than $4,400 that had been charged off as bad debts. Applicant suspects the debt in 1.gand 1.fare the same, but presented nothing to corroborate his belief. In 2004, Applicant entered an installment repayment plan with one of his creditors to whom he owes $5,720. He pays $193 each month for 36 months. Although other creditors have offered settlements, Applicant doesn't feel able to afford them and has made no arrangements to pay off his other debts.

Applicant and his wife bought a new vehicle in 2005, on which they pay approximately $600 a month. He thinks his mortgage is $725 a month.

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 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 with the national interest to do so." Exec. Or. 10865, Safeguarding Classified Information within 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.

Enclosure 2 of the Directive sets forth personnel 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 the applicant has not met the strict guidelines the President and the Secretary of Defense have established for issuing a clearance.

CONCLUSION

In the SOR, DOHA alleged Applicant had delinquent debts totaling more than $13,900 that were in collection status (¶¶ 1.a, 1.e, 1.f, 1.g) and delinquent debts totaling more than $4,400 that had been charged off (¶¶ 1.b-1.d, 1.h). In his Answer, Applicant admitted each of the allegations. An applicant who is financially overextended is at risk of having to engage in illegal acts to generate funds. Directive ¶ E2.A6.1.1.

The evidence established the existence of each of the debts alleged in the SOR. The Government established potentially disqualifying conditions under Guideline F. Applicant has a history of not meeting his financial obligations (DC E2.A6.1.2.1.) and is unable or unwilling to satisfy his debts (DC E2.A6.1.2.3.). After carefully considering all of the information, I find only one mitigating condition listed under the guideline applies-Applicant has made a good faith effort to repay overdue debts (MC E2.A6.1.3.6)-and that applies to only one of his eight debts valued at $5,720. Paying off his debts does not appear to be a very high priority for Applicant. He has three fairly small debts; one for $369, a second for $564, and a third for $694. Yet he has taken no action to try to resolve these debts by either paying them off or setting up a payment plan. Although he suspects the debt alleged in ¶ 1.gmay be the same as alleged in ¶ 1.f, he did not even investigate to find out if that was the case. Under all the circumstances of this case, I conclude Applicant failed to mitigate the financial security concerns, except for the debt alleged in ¶ 1.f, for which he established a payment plan and has been paying.

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: For Applicant

Subparagraph 1.g: Against Applicant

Subparagraph 1.h: Against Applicant

Subparagraph 1.d: Against Applicant

Subparagraph 1.e: Against Applicant

DECISION

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

James A. Young

Administrative Judge

FOOTNOTES

APPEARANCES

FOR GOVERNMENT Robert E. Coacher, Esq., Department Counsel file:///usr.osd.mil/...yComputer/Desktop/DOHA%20transfer/DOHA-Kane/dodogc/doha/industrial/Archived%20-%20HTML/05-03559.h1.htm[7/2/2021 3:46:00 PM] FOR APPLICANT Pro Se