PSH-13-0034

* The original of this document contains information which is subject to withholding from disclosure under
5 U.S.C. 552. Such material has been deleted from this copy and replaced with XXXXXX’s.
United States Department of Energy
Office of Hearings and Appeals
In the Matter of Personnel Security Hearing )
)
Filing Date: March 18, 2013 ) Case No.: PSH-13-0034
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Issued: June 13, 2013
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Decision and Order
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Robert B. Palmer, Hearing Officer:
This Decision concerns the eligibility of XXXXXXXX (hereinafter referred to as “the
individual”) for access authorization under the regulations set forth at 10 C.F.R. Part 710,
entitled "Criteria and Procedures for Determining Eligibility for Access to Classified
Matter or Special Nuclear Material.” 1 For the reasons set forth below, I conclude that the
individual’s security clearance should not be restored at this time. 2
I. BACKGROUND
The individual is employed by a Department of Energy (DOE) contractor, and was
granted a security clearance in connection with that employment. During a routine re-
investigation in 2012, the local security office (LSO) obtained information about the
individual’s finances that raised security concerns. The LSO summoned the individual for
an interview with a personnel security specialist. After this Personnel Security Interview
(PSI) failed to adequately address these concerns, the LSO determined that derogatory
1An access authorization is an administrative determination that an individual is eligible
for access to classified matter or special nuclear material. 10 C.F.R. § 710.5. Such
authorization will also be referred to in this Decision as a security clearance.
2 Decisions issued by the Office of Hearings and Appeals (OHA) are available on the
OHA website located at http://www.oha.doe.gov . The text of a cited decision may be
accessed by entering the case number of the decision in the search engine located at
http://www.oha.doe.gov/search.htm.
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information existed that cast into doubt the individual’s eligibility for access
authorization. It informed the individual of this determination in a letter that set forth the
DOE’s security concerns and the reasons for those concerns. I will hereinafter refer to
this letter as the Notification Letter. The Notification Letter also informed the individual
that she was entitled to a hearing before a Hearing Officer in order to resolve the
substantial doubt concerning her eligibility for access authorization.
The individual requested a hearing on this matter. The LSO forwarded this request to the
Office of Hearings and Appeals, and I was appointed the Hearing Officer. The DOE
introduced six exhibits into the record of this proceeding. The individual introduced eight
exhibits and testified at the hearing, as did her daughter.
II. THE NOTIFICATION LETTER AND THE DOE’S SECURITY CONCERNS
As indicated above, the Notification Letter included a statement of derogatory
information that created a substantial doubt as to the individual’s eligibility to hold a
clearance. This information pertains to paragraph (l) of the criteria for eligibility for
access to classified matter or special nuclear material set forth at 10 C.F.R. § 710.8.
Criterion (l) defines as derogatory information indicating that the individual has engaged
in unusual conduct or is subject to circumstances which tend to show that he is not
honest, reliable or trustworthy; or which furnishes reason to believe that he may be
subject to pressure, coercion, exploitation or duress which may cause him to act contrary
to the best interests of national security. Such conduct or circumstances include, but are
not limited to, a pattern of financial irresponsibility. As support for its invocation of this
criterion, the Letter alleges that the individual has $25,101 in delinquent debt, including:
 14 collection accounts totaling $6,656;
 Four charged-off accounts totaling $9,070;
 $9,000 for three years of unpaid lot rental fees; and
 $375 owed to her credit union.
The Letter also cites statements made by the individual during her January 2013 PSI
indicating that:
 She has not contacted any of her creditors despite previous statements during her
reinvestigation that she intended to do so;
 She has ignored $3,544 in medical-related debts for seven years, hoping that they
would “go away;”
 She opened four of the collection or charged-off accounts on her 30 year-old
daughter’s behalf, and is responsible for the corresponding debt. However, she
has made no effort to resolve the debt, and continues to open accounts for her
daughter because the individual “doesn’t learn;” and
 She received a $42,000 settlement in 2005 following a 2004 car accident;
however, she spent the money on things other than paying off delinquent debt
because of “greed.”
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Finally, the Letter refers to the individual’s acknowledgement during a 2008 PSI of the
DOE’s concerns regarding financial irresponsibility. Despite this acknowledgement, the
individual proceeded to accrue over $25,000 in new delinquent debt.
The individual generally does not dispute these allegations, and they adequately justify
the DOE’s invocation of criterion (l). They also raise significant security concerns.
Failure or inability to live within one’s means, satisfy debts, and meet financial
obligations may indicate poor self-control, lack of judgment, or unwillingness to abide by
rules and regulations, all of which can raise questions about an individual’s reliability,
trustworthiness, and ability to protect classified information. Also, an individual who is
financially overextended is at risk of having to engage in illegal acts to generate funds.
See Revised Adjudicative Guidelines for Determining Eligibility for Access to Classified
Information, The White House (December 19, 2005), Guideline F.
III. REGULATORY STANDARDS
The criteria for determining eligibility for security clearances set forth at 10 C.F.R. Part
710 dictate that in these proceedings, a Hearing Officer must undertake a careful review
of all of the relevant facts and circumstances, and make a “common-sense judgment . . .
after consideration of all relevant information.” 10 C.F.R. § 710.7(a). I must therefore
consider all information, favorable or unfavorable, that has a bearing on the question of
whether granting or restoring a security clearance would compromise national security
concerns. Specifically, the regulations compel me to consider the nature, extent, and
seriousness of the individual’s conduct; the circumstances surrounding the conduct; the
frequency and recency of the conduct; the age and maturity of the individual at the time
of the conduct; the absence or presence of rehabilitation or reformation and other
pertinent behavioral changes; the likelihood of continuation or recurrence of the conduct;
and any other relevant and material factors. 10 C.F.R. § 710.7(c).
A DOE administrative proceeding under 10 C.F.R. Part 710 is “for the purpose of
affording the individual an opportunity of supporting his eligibility for access
authorization.” 10 C.F.R. § 710.21(b)(6). Once the DOE has made a showing of
derogatory information raising security concerns, the burden is on the individual to
produce evidence sufficient to convince the DOE that granting or restoring access
authorization “will not endanger the common defense and security and will be clearly
consistent with the national interest.” 10 C.F.R. § 710.27(d). See Personnel Security
Hearing, Case No. VSO-0013, 24 DOE ¶ 82,752 at 85,511 (1995) (affirmed by OSA,
1996), and cases cited therein. The regulations further instruct me to resolve any doubts
concerning the individual’s eligibility for access authorization in favor of the national
security. 10 C.F.R. § 710.7(a).
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IV. FINDINGS OF FACT AND ANALYSIS
A. Findings of Fact
The record in this matter indicates that circumstances over which the individual had little
or no control, and the individual’s irresponsibility, both contributed to her current
financial dilemma. The individual testified that her financial problems began in 1999,
when she divorced her husband. Hearing transcript (Tr.) at 45. She was working at a
convenience store at the time, and although her husband had custody of their children and
the individual was not required to pay child support, she was not making enough money
to support herself. DOE Exhibit (DOE Ex.) 5 at 14-15. Consequently, she lived with her
parents for several months, Tr. at 45, before they helped her purchase a trailer. With a car
note and a mortgage, she began to fall behind in paying her bills. Some of these were
medical bills that the individual incurred because she did not have health insurance. DOE
Ex. 5 at 16. In 2004, the individual was in an automobile accident, and later that year, she
received a $42,000 settlement as a result. DOE Ex. 5 at 22. Although the individual did
pay off some of her debts with this money (including $7,000 owed to her parents and
$4,000 owed in lot rental payments for her trailer), she also spent $17,000 on a car,
bought furniture for her trailer, and gave her daughters money to pay their bills, but did
not use it to pay some of her overdue bills. DOE Ex. 5 at 24, 30, 42; Tr. at 36.
In 2008, the individual was summoned by the LSO for a PSI, during which her finances
were the primary topic of discussion. At that time, she had at least seven collection
accounts and her credit report showed overdue debt in the amount of $8,000. DOE Ex. 5
at 52. Her wages had been garnished. Id. at 32. She was also delinquent in paying her
state and local taxes. The individual explained that she would falsely claim 10 deductions
on her taxes, which would result in less money being withheld from her paycheck.
However, the amount withheld would be insufficient to pay her taxes, and she would
have to set up a repayment plan with the state and federal tax authorities to satisfy her
debts. Id. at 45-47. The LSO explained the DOE’s security concerns regarding personal
finances to the individual, and she promised to stop claiming an incorrect number of
deductions, and to make a more concerted effort to satisfy her debts. Id. at 58-65.
In 2012, the individual’s trailer burned down. Although the dwelling itself was covered
by insurance, the individual testified, its contents were not, and the expenses associated
with this event appear to have adversely affected the individual’s ability to meet her
financial obligations. Tr. at 46.
As previously indicated, in 2013, the LSO again summoned the individual for a PSI about
her finances. At that time, the individual had 18 collection or charged-off accounts,
totaling in excess of $15,000 in delinquent debt, and $9,000 in unpaid lot rental fees. She
had made repayment agreements with some of her medical creditors, but stopped paying
because “something always [came] up.” DOE Ex. 6 at 17. Despite this inability to satisfy
her own financial obligations, she opened at least four accounts in her own name for the
benefit of one of her adult daughters, including accounts for the purchase of cars in 2007
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and 2011. Id. at 32, 50. The understanding between the two of them was that the daughter
was to pay these bills, but when she got laid off, that duty fell to the individual. Tr. at 48.
Despite her assurances during the 2008 PSI, some of the debts covered during that
Interview remained unpaid as of January 2013. DOE Ex. 6 at 41.
At the hearing, the individual testified that she has made a concerted effort to pay her
delinquent debt. She has paid off 12 of the collection and charged-off accounts, she has
arranged for payment plans for five other such accounts and for her overdue lot rental
payments, and her ex-husband is paying off one of the accounts. Tr. at 18-30. She further
stated that she has told her adult daughter that she can no longer help the daughter out
financially, that she now has a budget, and that she is now behaving in a financially
responsible manner and has been doing so since she contacted her creditors to formulate
repayment plans “a few months” before the hearing. Tr. at 48-49, 51-52.
B. Analysis
Notwithstanding the individual’s recent efforts to address her outstanding financial
obligations, I continue to harbor substantial doubts about the individual’s finances. As an
initial matter, although I recognize that factors that were largely outside of the
individual’s control, such as her 1999 divorce and the 2012 fire, contributed to the
individual’s financial difficulties, I conclude that they were primarily caused by the
individual’s poor financial decisions. In 2004, the individual chose to give money to her
daughters, buy furniture, and spend $17,000 for an automobile, rather than devote more
of her $42,000 windfall to meeting her own financial obligations. She also opened
accounts for cable and cell phone service, and for two cars, in her own name, but for her
adult daughter’s benefit, at a time when she had accrued a number of collection or
charged-off accounts, and had $9,000 in unpaid lot rental fees. As of the date of the
Notification Letter, the overdue debt for these four accounts totaled over $11,000, almost
half of the individual’s total debt of $25,101. As of the date of the hearing, the overdue
debt for these accounts totaled $7,805, approximately 43 percent of the individual’s total
remaining overdue debt of $18,100. The individual opened a second account for the
purchase of an automobile for her daughter in 2011, even though the first car that she
bought for her had been repossessed in 2007 after her daughter had failed to remain
current on the car payments.
Furthermore, the individual has not established a pattern of financially responsible
behavior that is of sufficient duration and effect to offset the years of financial
irresponsibility that have led to the individual’s current situation. Assuming that the
individual contacted her creditors to establish payment plans right after her January 2013
PSI, it appears that she has been behaving in a financially responsible manner for
approximately four months. During that time, she has reduced her indebtedness to these
creditors by approximately $7,000. Although she has made progress in extricating herself
from her difficulties, a substantial amount of overdue debt remains, and four months of
good decision-making regarding money is insufficient to convince me that a return to her
previous pattern of poor judgment is unlikely.
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Finally, the record in this matter indicates that the individual’s recent financial progress
has been made with substantial financial support from her ex-husband, and there is
nothing in the record that guarantees that that support will continue. The individual
borrowed $6,000 from her ex-husband to pay off some of her creditors; in effect,
exchanging one debt for another. Furthermore, after the individual’s trailer was damaged
by fire in 2012, she moved in with her ex-husband with the agreement that she would pay
for the groceries, but that he would not charge her rent and would pay all of the other
domestic expenses. Tr. at 55. The individual’s current budget (which does not include a
monthly figure for groceries for herself, her ex-husband, and the two daughters who live
with them) shows a monthly surplus of $631. However, the individual’s trailer is being
renovated, and she plans to move back into it once work is complete. Tr. at 54.
Presumably, at that time, the individual will have to assume the domestic expenses that
are now paid by her ex-husband. The extent to which this will affect the individual’s
budget is unclear, and, accordingly, I cannot be certain that the individual will be able to
continue to service her debts while incurring these new expenses. Significant security
concerns remain regarding the individual’s finances.
V. CONCLUSION
For the reasons set forth above, I find that the individual has not adequately addressed the
DOE’s concerns under criterion (l). Consequently, she has failed to convince me that
restoring her access authorization would not endanger the common defense and would be
clearly consistent with the national interest. Accordingly, I find that the DOE should not
restore the individual’s security clearance at this time. Review of this decision by an
Appeal Panel is available under the procedures set forth at 10 C.F.R. § 710.28.
Robert B. Palmer
Hearing Officer
Office of Hearings and Appeals
Date: June 13, 2013