PSH-16-0066

*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: July 14, 2016 ) Case No.: PSH-16-0066
)
__________________________________________)
Issued: November 30, 2016
__________________________
Administrative Judge Decision
__________________________
Wade M. Boswell, Administrative Judge:
This Decision concerns the eligibility of XXXX XXXX XXXX (hereinafter referred to as
“the individual”) to hold an access authorization1 under the Department of Energy’s (DOE)
regulations set forth at 10 C.F.R. Part 710, Subpart A, entitled, “General Criteria and
Procedures for Determining Eligibility for Access to Classified Matter or Special Nuclear
Material.” As fully discussed below, after carefully considering the record before me in
light of the relevant regulations and Adjudicative Guidelines, I have determined that the
individual’s access authorization should be restored.
I. Background
The individual has been employed by DOE contractors for approximately 30 years at a
DOE site in a position that requires him to hold access authorization. During this period of
time, the Local Security Office (LSO) has conducted several personal security interviews
(PSIs) with the individual on a variety of topics, including finances and workplace conduct.
Most recently, the LSO conducted a PSI with the individual in May 2015, in an interview
that focused on the individual’s mortgage delinquencies and his attempts to negotiate a
mortgage loan modification. See Exhibit 9.
1 Access authorization is defined as “an administrative determination that an individual is eligible for access
to classified matter or is eligible for access to, or control over, special nuclear material.” 10 C.F.R. § 710.5(a).
Such authorization will be referred to variously in this Decision as access authorization or security clearance.
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Approximately two months later, the individual’s employer advised the LSO that the
individual had been issued a written warning for a security infraction that occurred in July
2015. See Exhibit 3 and Exhibit 7. While evaluating this information, the LSO received a
credit report (August 2015) showing that the individual continued to be delinquent on his
mortgage and had filed a petition for bankruptcy. See Exhibit 5. The individual had failed
to report the bankruptcy petition to the LSO as required by DOE order. See DOE Order
472.2 at Attachment 4.
Subsequently, the LSO advised the individual in a letter (Notification Letter) dated June
16, 2016,2 that it possessed reliable information that created substantial doubt regarding his
eligibility to hold a security clearance. In an attachment to the Notification Letter (the
Summary of Security Concerns), the LSO explained that the derogatory information fell
within the purview of one potentially disqualifying criterion set forth in the security
regulations at 10 C.F.R. § 710.8, subsection (l) (hereinafter referred to as Criterion L).3 See
Exhibit 1.
Upon his receipt of the Notification Letter, the individual exercised his right under the Part
710 regulations by requesting an administrative review hearing. See Exhibit 2. The Director
of the Office of Hearings and Appeals (OHA) appointed me the Administrative Judge in
the case and, subsequently, I conducted an administrative hearing in the matter. The LSO
introduced 47 numbered exhibits into the record and presented the testimony of two
witnesses, both personnel security specialists. The individual, represented by counsel,
introduced 17 lettered exhibits (Exhibits A – Q) and presented the testimony of two
witnesses, including that of himself. The exhibits will be cited in this Decision as “Ex.”
followed by the appropriate numeric or alphabetic designation. The hearing transcript in
the case will be cited as “Tr.” followed by the relevant page number.4
II. Regulatory Standard
A. Individual’s Burden
A DOE administrative review proceeding under Part 710 is not a criminal matter, where
the government has the burden of proving the defendant guilty beyond a reasonable doubt.
Rather, the standard in this proceeding places the burden on the individual because it is
designed to protect national security interests. This is not an easy burden for the individual
to sustain. The regulatory standard implies that there is a presumption against granting or
restoring a security clearance. See Department of Navy v. Egan, 484 U.S. 518, 531 (1988)
(“clearly consistent with the national interest” standard for granting security clearances
2 The individual’s access authorization was apparently suspended in October 2015. Transcript at 140. The
record provides no explanation as to the eight-month delay in the issuance of the Notification Letter.
3 See Section III below.
4 OHA decisions are available on the OHA website at www.energy.gov/oha/office-hearings-and-appeals. A
decision may be accessed by entering the case number in the search engine at www.energy.gov/oha/security-
cases.
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indicates “that security determinations should err, if they must, on the side of denials”);
Dorfmont v. Brown, 913 F.2d 1399, 1403 (9th Cir. 1990), cert. denied, 499 U.S. 905 (1991)
(strong presumption against the issuance of a security clearance).
An individual must come forward with evidence to convince the DOE that granting or
restoring his or her 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).
The individual is afforded a full opportunity to present evidence supporting his or her
eligibility for an access authorization. The Part 710 regulations are drafted so as to permit
the introduction of a very broad range of evidence at personnel security hearings. Even
appropriate hearsay evidence may be admitted. 10 C.F.R. § 710.26(h). Thus, an individual
is afforded the utmost latitude in the presentation of evidence to mitigate the security
concerns at issue.
B. Basis for the Administrative Judge’s Decision
In personnel security cases arising under Part 710, it is my role as the Administrative Judge
to issue a Decision that reflects my comprehensive, common-sense judgment, made after
consideration of all the relevant evidence, favorable and unfavorable, as to whether the
granting or continuation of a person’s access authorization will not endanger the common
defense and security and is clearly consistent with the national interest. 10 C.F.R.
§ 710.7(a). I am instructed by the regulations to resolve any doubt as to a person’s access
authorization eligibility in favor of the national security. Id.
III. The Notification Letter and the Security Concerns at Issue
As previously noted, the LSO cited one criterion as the basis for suspending the
individual’s security clearance: Criterion L. Criterion L concerns information that an
individual has engaged in conduct “which tends to show that the individual is not honest,
reliable, or trustworthy….” 10 C.F.R. § 710.8(l). Conduct reflecting questionable
judgment, lack of candor, dishonesty, or unwillingness to comply with rules and
regulations raises questions about an “individual’s reliability, trustworthiness and ability
to protect classified information.” See Guidelines E and F of the Revised Adjudicative
Guidelines for Determining Eligibility for Access to Classified Information, issued on
December 29, 2005, by the Assistant to the President for National Security Affairs, The
White House (Adjudicative Guidelines). With respect to Criterion L, the LSO alleges,5
inter alia, that the individual: (1) violated workplace rules on four occasions; (2) has been
5 The Summary of Security Concerns attached to the Notification Letter is ten pages in length and alleges
security concerns relating to personal conduct, financial considerations, criminal conduct, and failure to
safeguard classified or sensitive information. See Ex. 1. On the day of the hearing, the LSO modified the
Summary of Security Concerns by striking nearly half of the allegations enumerated with respect to personal
conduct, the majority of the alleged financial concerns, and all of the allegations with respect to criminal
conduct and the failure to safeguard classified or sensitive materials. See Ex. 34. At the hearing, DOE counsel
confirmed that those items stricken from the Summary of Security Concerns were no longer concerns to be
considered during the administrative review hearing. Tr. at 6-7. Accordingly, this decision considers only
those allegations in the modified Summary of Security Concerns as set forth in Exhibit 34.
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delinquent on his home mortgage since at least 2011 (i.e., approximately five years as of
the date of the Notification Letter); and (3) failed to honor commitments he made to the
DOE during several PSIs between 2011 and 2015. Ex. 34 at 1-9.
In light of the information available to the LSO, the LSO properly invoked Criterion L.
IV. Findings of Fact and Analysis
I have thoroughly considered the record of this proceeding, including the submissions
tendered in this case and the testimony of the witnesses presented at the hearing. In
resolving the question of the individual’s eligibility for access authorization, I have been
guided by the applicable factors prescribed in 10 C.F.R. § 710.7(c)6 and the Adjudicative
Guidelines. After due deliberation, I have determined that the individual’s access
authorization should be restored. The specific findings that I make in support of this
decision are discussed below.
Preliminarily, I note that the individual and the LSO entered into a Stipulations of Fact,
dated October 10, 2016 (Stipulation or Stip.), with respect to many of the factual matters
alleged in the Summary of Security Concerns, as it was modified by the LSO on the
morning of the hearing (the Modified Summary of Security Concerns). See Ex. 34.
Additionally, the individual did not dispute several factual matters not addressed in the
Stipulation; however, in all instances where the individual contested the allegations, I have
carefully considered the totality of the individual’s testimony, the entirety of the written
record, and the arguments presented by both the individual and the LSO in reaching the
findings of fact set forth herein.
A. Administrative Judge Evaluation of the Evidence and Finding of Facts:
Criterion L Security Concerns with Respect to Individual’s Failure to
Honor Commitments
The Modified Summary of Security Concerns refers to four different PSIs in which the
individual is alleged to have made commitments, which he is then alleged to have not
honored. See Ex. 34 at 7-9. In the Modified Summary of Security Concerns, the relevant
PSIs are cited to substantiate that the individual made commitments to the LSO; however,
no citations are provided to support the LSO’s allegations that the individual failed to honor
such commitments.7 During the pre-hearing conference, DOE Counsel stated that the LSO
6 Those factors include the following: the nature, extent, and seriousness of the conduct, the circumstances
surrounding the conduct, to include knowledgeable participation, the frequency and recency of the conduct,
the age and maturity at the time of the conduct, the voluntariness of his participation, the absence or presence
of rehabilitation or reformation and other pertinent behavioral changes, the motivation for the conduct, the
potential for pressure, coercion, exploitation, or duress, the likelihood of continuation or recurrence, and
other relevant and material factors.
7 The Summary of Security Concerns did cite the conclusions contained in an LSO case evaluation sheet as
a separate factual support for this security concern. See Ex. 34 at 8 (item II.B.6). However, notwithstanding
that this case evaluation sheet was cited in the Notification Letter, the LSO failed to produce it (Ex. 37) until
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would provide witness testimony to evidence the individual’s alleged failures to honor his
commitments. At the hearing, the LSO presented the testimony of two personnel security
specialists. See Tr. at 16-113. As described below, the testimony of the personnel security
specialists was frequently vague, at times contradictory to the allegations set forth in the
Modified Summary of Security Concerns, and at times inconsistent with documents the
LSO had tendered to the record. Ultimately, there appeared to be a chasm between the
LSO’s security files (to the extent that they were produced) and the allegations set forth in
the Modified Summary of Security Concerns which, when combined with the overly broad
language of certain of the allegations, obscured any failures by the individual which may
have actually occurred.
At the hearing, the individual testified on his own behalf. Although the individual does not
appear to be financially sophisticated and he acknowledged having been confused by
aspects of the mortgage modification process, the individual was candid and direct at the
hearing and I concluded that his testimony was highly credible.
October 2011 PSI. The Modified Summary of Security Concerns states that during a PSI
in October 2011,8 the individual promised to address certain financial accounts and/or
provide certain financial documentation by November 30, 2011, and that “the individual
failed to do so.” Ex. 34 at 9 (items II.B.17, 18 and 19). However, on the morning of the
hearing, the LSO submitted into the record (and provided to the individual’s counsel at the
same time) copies of documents received by the LSO from the individual and dated-
stamped by the LSO on December 9, 2011. See Ex. 45. These documents relate to the
financial matters discussed with the individual during the PSI. The personnel security
specialist who conducted the PSI appeared at the hearing and testified that the documents
provided by the individual had been insufficient as to content and that the individual had
not provided proof of a certain cash payment referred to in his submission. Tr. at 19, 25.
At the hearing, the personnel security specialist was unable to state whether the individual
was advised of such deficiencies. Id. at 28-29. However, the LSO’s case evaluation sheet,9
signed by the testifying personnel security specialist on the date the individual submitted
the documents to the LSO in 2011, did not raise such concerns with respect to the
the morning of the hearing and, thereby, precluded both the individual and OHA from conducting a proper,
timely examination of the document.
8 With respect to these occurrences, the Summary of Security Concerns cites a PSI dated September 15,
2011. See Ex. 1 at 9 (items II.B.17 and 19). However, the LSO introduced into the record no PSI dated or
occurring on such date. On the morning of the hearing, the LSO modified the Summary of Security Concerns
by hand to change the citation to a PSI dated October 31, 2011 (which had been previously submitted). See
Ex. 34 at 9 (items II.B.17 and 19).
9 The case evaluation sheet prepared by the LSO with respect to the 2011 PSI and the individual’s subsequent
submissions was also first provided to the individual’s counsel and submitted into the record on the morning
of the hearing. See Ex. 43. This case evaluation contains relevant information that is exculpatory and, under
the Part 710 regulations, was required to be made available to the individual. See 10 C.F.R. § 710.26(d). It is
concerning that the LSO delayed delivery of such information until the morning of the hearing and it was
part of a package of 14 new exhibits. The commencement of the hearing was delayed as the individual and
his counsel attempted to review the late submissions on the morning of the hearing.
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individual’s submission and, instead, recommended continued access authorization for the
individual with a file review in 12 months. Ex. 43. During her testimony, the personnel
security specialist testified that she had not drafted the LSO’s security concerns but
“assumed” the individual’s failure cited as a concern was a reference to the documents
being submitted later than the date specified during the PSI.10 Tr. at 32-33. No concerns
regarding the timeliness of the individual’s submission were noted on the LSO’s case
evaluation sheet prepared contemporaneously with the individual’s submission. See Ex.
43. (The individual’s testimony suggests that the “late” submission was likely his second
submission of those documents. Tr. at 152.) To the extent that the personnel security
specialist is correct that the security concern alleging the individual’s “failure” to meet his
commitment is due to the individual’s submission being nine days late, the Modified
Summary of Security Concerns with respect to the October 2011 PSI is both confusing and
disingenuous, especially in light of the LSO’s failure to tender the documents received
from the individual in 2011 until the morning of the hearing.
February 2013 PSI. The Modified Summary of Security Concerns states that during a PSI
in February 2013, the individual promised to address certain financial accounts and/or
provide certain financial documentation by March 11, 2013, and that “the individual failed
to do so.” Ex. 34 at 8 (items II.B.11 and 15).
One allegation states that the individual “signed a Certification to furnish
document/information with a due date of March 11, 2013. The individual failed to do so.”
Ex. 34 at 8-9. That certification (again, first submitted by the LSO on the morning of the
hearing) lists three items on which the individual agreed to provide documentation. Two
of those items (a state tax lien and a medical account) were the bases of two separate
security concerns listed in the original Summary of Security Concerns alleging, in each
case, that the “individual had failed to” provide the promised information. Ex. 1 at 8 (items
II.B.13 and 14). Those security concerns were stricken from the Summary of Security
Concerns on the morning of the hearing, and were appropriate deletions in light of the
LSO’s own records reflecting that the individual had submitted the promised information
with respect to the satisfaction of the state tax lien two days after the PSI and with respect
to the medical account ten days prior to the date specified during the PSI. Ex. 23, Ex. 26.
The third item requested was “proof mortgage is being modified (new loan).” Ex. 42. With
respect to this item, the individual submitted to the LSO two general letters that he received
from his mortgage lender with respect to “loan assistance.” Ex. 24, Ex. 25. These letters
were dated-stamped as received by the LSO two days after the PSI. At the hearing, the
personnel security specialist who conducted the February 2013 PSI was vague when asked
whether the individual had provided the information requested during the PSI, responding
“I can’t recall exactly without going into – further in the record. I can’t recall if it was
provided by that date [March 11, 2013] or not.” Tr. at 46-47.
10 Although the testifying personnel security specialist testified that she had not “authored” the security
concerns, she was the reviewing official who concurred in commencing the administrative review
proceedings against the individual. See Tr. at 33, Ex. 37 at 2.
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A separate matter alleged as a security concern arising from the February 2013 PSI is that
“the individual was asked why he failed to address any of the accounts from the previous
interview … and the individual responded that he had no contact information.” Ex. 34 at 8
(item II.B.12) (emphasis added). However, the discussion in the PSI cited in the Modified
Summary of Security Concerns relates to the individual stating that he had previously
spoken with the LSO about not knowing how to contact one specific creditor, the medical
account referred to above. See Ex. 22 at 4-6. The personnel security specialist responds by
making recommendations as to how to identify the creditor. Less than three weeks later (as
reflected in the LSO’s own submissions), the individual provided the LSO with
documentation that he had paid the account. Ex. 26.
There is nothing in the record that indicates the LSO communicated with the individual
after his document submissions, all of which occurred before the deadline, to advise him
of any deficiency in his submissions. It also appears that the individual’s access
authorization was continued at that point; however, the LSO did not submit any case
evaluation summaries prepared with respect to the February 2013 PSI and the individual’s
subsequent submissions.
December 2013 PSI. The Modified Summary of Security Concerns states that during a PSI
in December 2013, the individual promised to address certain financial accounts and/or
provide certain financial documentation by January 30, 2013, and that “the individual
failed to do so.” Ex. 34 at 8 (items II.B.7 and 10). Although the language in the Modified
Summary of Security Concerns is very broad with respect to the individual’s commitments
and failures, it cites a section of PSI in which the LSO specified the date by which the
individual needed to provide “paperwork.” See Ex. 14 at 36; Ex. 34 at 8 (item II.B.7). Due
to the ambiguity of this allegation, I focused my inquiry on the three subsequent allegations
in the original Summary of Security Concerns, all of which relate to the December 2013
PSI and each relates to a specific commitment. Two of these allege that the individual
“failed” to provide documentation or take certain actions as he had committed to do during
the PSI; both were stricken from the Summary of Security Concerns on the morning of the
hearing. Ex. 34 at 8 (items II.B.8 and 9). The third specific allegation set forth with respect
to the December 2013 PSI (which allegation was not stricken from the Summary of
Security Concerns) states that the individual allegedly failed to honor his commitment
during the PSI to provide documentation with respect to a loan modification on his
mortgage. Ex. 34 at 8 (item II.B.10). The PSI included a specific discussion requesting the
individual to provide a letter to the LSO with respect to the loan modification that had been
completed. Ex. 14 at 23, 31. At the hearing, the personnel security specialist who had
conducted the PSI testified, in response to a question about whether the individual had
provided any documentation with respect to his mortgage modification,11 “We received
some paperwork, but I don’t know the date and I can’t – you know, testify to that without
referring to a document right now.” Tr. at 60. This testimony by the personnel security
specialist suggests that the allegation that the individual failed to provide documentation
with respect to his mortgage modification is inaccurate. The personnel security specialist
11 The question asked by the DOE Counsel referred to documents on a “re-modification”; however, all of
the portions of the PSI that were being referred to in the preceding questions related to the original loan
modification that had been completed. Tr. at 60. See Ex. 14 at 31-33.
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confirmed during his testimony that the individual’s access authorization was continued
after the PSI. Id.
While the personnel security specialist’s testimony acknowledged that the individual had
submitted “some paperwork” (seemingly undermining the allegation that the individual
failed to provide documentation with respect to his mortgage modification), the LSO’s
submissions into the record of the proceeding include a package of financial documents
received from the individual, which includes a copy of the individual’s completed
mortgage modification and associated correspondence from his lender. Ex. 13. These
appear to match the description of the documents requested by the LSO during the PSI.
(Other documents in the individual’s package appear to relate to the two other items
specifically addressed during the PSI, which the original Summary of Security Concerns
alleged had not been provided to the LSO. Id. As noted in the preceding paragraph, those
two allegations were stricken the morning of the hearing.) These documents were all dated-
stamped by the LSO as received on January 14, 2014, which was more than two weeks
prior to the deadline specified by the LSO during the PSI. Id.
May 2015 PSI. The Modified Summary of Security Concerns states that during a PSI in
May 2015, the individual promised to address certain financial accounts and/or provide
certain financial documentation by July 31, 2015. Ex. 34 at 7-8 (items II.B.1, 3 and 6). The
individual submitted documentation on the payment of certain accounts, which the LSO
date-stamped as received on July 29, 2015. Ex. 8, Ex. 11. The LSO’s case evaluation sheet
completed in August 2015 indicates that not all of the information requested was received
(although the two items specifically noted in the case evaluation sheet as omitted by the
individual were stricken as security concerns on the morning of the hearing and, therefore,
are not included in the Modified Summary of Security Concerns). Ex. 37 at 2. See Ex. 34
at 7-8 (items II.B.2 and 4).
With respect to the mortgage modification, the Modified Summary of Concerns states that
the LSO received documentation from the individual, however, it alleges that the
information did not provide the LSO with the “answers” it sought with respect to the status
of his mortgage. Ex. 34 at 7 (item 1). The LSO did not describe with any specificity, in
either the Modified Summary of Security Concerns or in the testimony of its personnel
security specialists, the information omitted from the individual’s submissions. The
information received by the LSO from the individual, also date-stamped July 29, 2015,
included a copy of a letter from the third party working with the individual on the mortgage
modification and a copy of the wire transfer of funds from the individual to the third party
for its fees. Ex. 11 at 2, 3. While the LSO contends this information did not answer its
questions, I note that it is as detailed as information submitted by the individual following
prior PSIs, which had been accepted by the LSO and was apparently deemed sufficient on
earlier occasions for the LSO to continue the individual’s access authorization. Cf. Ex. 24,
Ex. 25, Ex. 45. Following receipt of the individual’s documentation, the LSO did not advise
the individual that his submission had been deficient. Tr. at 234. According to the testimony
of the personnel security specialist who conducted the PSI and recommended
commencement of the administrative review proceedings, the individual’s access
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authorization would have been continued, as it had been in the past, had the individual’s
document submission been more complete. Id. at 88-89.
Analysis of Security Concerns with Respect to Commitments Made by the Individual. In the
Modified Summary of Security Concerns, the LSO alleges that the individual made
commitments in four separate PSIs which he failed to honor. As described above, the
allegations are frequently described very broadly; however, in almost every instance where
I could identify specific commitments made by the individual during a PSI, the LSO had
submitted documents into the record that it had received from the individual to honor his
commitments. Most of these documents were date-stamped as received by the LSO prior
to the deadlines specified during the PSIs. In the one instance where the documents were
received nine days after the deadline, the individual credibly testified that that was a
resubmission of documents previously submitted on a timely basis. Even to the extent that
he may have been mistaken on making a prior timely submission, a nine-day delay would
not support a Criterion L security concern brought five years after the submission,
particularly where the LSO had contemporaneously accepted the “late” submission and
continued the individual’s access authorization without comment as to any tardiness of the
individual’s submission. See Ex. 43.
In addition to the LSO’s own records undermining the validity of allegations set forth in
the Modified Summary of Security Concerns, the testimony of the personnel security
specialists did not substantiate the “failures” of the individual which were alleged in the
Modified Summary of Security Concerns. Instead, the testimony tended to equivocate, be
vague, or contradict the broad language of the Summary of Security Concerns. Based on
the foregoing, I conclude that the record as a whole does not support a finding that the
individual failed to honor his commitments to the LSO and, therefore, the individual has
sufficiently resolved the Criterion L security concerns alleged with respect such
allegations.
B. Administrative Judge Evaluation of the Evidence and Findings of Fact:
Criterion L Security Concerns with Respect to Financial
Considerations
Although the LSO interviewed the individual over the years with respect to various
financial matters, the financial matters raised in the Modified Summary of Security
Concerns relate solely to the individual’s delinquencies on his home mortgage. See Ex. 34
at 2-7. A personnel security specialist testifying on behalf of the LSO testified that the
individual’s most recent credit report contained no other current delinquencies of any
significance. Tr. at 53-54.
The individual acknowledges that he is delinquent on his mortgage. Stip. at 2-3. His
mortgage arrearages began during a period when he was unemployed (or under-employed)
and arbitrating the termination of his employment. At the time he was terminated, he had
outstanding loans from a retirement account which he did not have the ability to repay and
those loans were converted to taxable distributions from his retirement account. He also
withdrew additional amounts from his retirement account for living expenses during the
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period he was arbitrating his termination. By the time his employment was reinstated, he
had accrued state and federal tax liabilities in excess of $50,000, largely attributable to the
taxable distributions from his retirement account. The individual fell behind on his
mortgage as a result of his period of unemployment and decided, once he was reinstated
by his employer, to prioritize payment of his tax liabilities. He has subsequently paid in
full his state and federal tax liabilities. Ex. E.
Subsequent to becoming delinquent on his mortgage, the individual attempted to modify
his mortgage on several occasions. The individual initially paid a fee to a third party to
negotiate a loan modification and, after a significant period of time, discovered the third
party was not a legitimate business and had defrauded its clients. After discovering that he
had been a victim of a fraud, the individual continued to pursue a mortgage modification
and believed that he had obtained a modification; however, after making the first two
payments under the “modified” mortgage, the individual received notice that his home was
still in foreclosure and that there had been an error in the documentation to modify the
mortgage. Tr. at 145. The individual questioned the appropriateness of the increased
mortgage payments proposed by his lender as part of “correcting” the previously negotiated
modification and, subsequently, retained the services of another third party. Id. at 144-145,
180-182. This third party succeeded in negotiating a modification. To become effective,
this modification required that the individual make the first three “modified” payments on
time. The individual made the first payment and, thereafter, incurred a reduction in income
following the suspension of his access authorization and failed to make any other payments
under the offered loan modification (or on the existing mortgage itself). Stip. at 2-3; Tr. at
220. During the approximately six-year period preceding the hearing, the individual made
a total of three monthly mortgage payments. Id. at 229-230.
With respect to his failure to make any additional monthly mortgage payments, the
individual testified that the monthly statements he received from his mortgage lender
directed him not to make payments since his mortgage was in foreclosure. Id. at 147, 213.
See Ex. F. While I have concerns about the correctness of the individual’s interpretation of
his mortgage statement, the LSO’s personnel security specialist, who testified that he
handled the majority of the LSO’s financial cases, concurred that he understood the
language on the individual’s mortgage statement in the same way as the individual. Tr. at
78, 92-93, 107-108.
The individual credibly evidenced that his mortgage delinquency resulted from his
unemployment (both directly as a result of the reduction in his income during the period of
employment and indirectly as a result of his prioritizing payment of the tax debt that arose
from taxable distributions from a retirement account during his period of unemployment).
Further, he evidenced financial responsibility through his continual attempts to modify his
mortgage and by payment of over $50,000 in tax liabilities following the reinstatement of
his employment. His delinquency originated due to circumstances outside of his control
(i.e., his unemployment) and I cannot fault the individual for prioritizing payment of tax
liabilities. Cf. Adjudicative Guidelines, Guideline F at ¶ 20(b). His attempts to modify his
mortgage were frustrated when he fell victim to fraud by an organization which purported
to assist distressed homeowners and, later, by his mortgage lender repudiating a fully
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completed loan modification. The individual was on course to complete another mortgage
modification when he incurred a reduction in income following the suspension of his access
authorization. Tr. at 140. His continual attempts to effectuate a mortgage modification
evidence a good faith effort to resolve his mortgage debt. Cf. Adjudicative Guidelines,
Guideline F at ¶ 20(d).
Based upon the foregoing, I find that the individual has sufficiently resolved the Criterion
L security concerns with respect to financial irresponsibility.
C. Administrative Judge Evaluation of the Evidence and Finding of Facts:
Criterion L Security Concerns with respect to Violations of Work Rules
The Modified Summary of Security Concerns enumerates four instances in which the
individual is alleged to have violated work rules and, with respect to these instances, the
individual does not dispute the facts cited in the Notification Letter. See Ex. 34; Stip. at 1,
3. The individual does, however, argue that the facts cited in the Notification Letter do not
fairly reflect the events which occurred nor do they sustain an adverse finding with respect
to his honesty, reliability or trustworthiness.
Letter of Termination (2006). The individual acknowledges that his employer terminated
his employment in 2006, citing the individual’s violation of company work rules as the
basis for the termination. Stip. at 1. The individual has consistently denied the allegations
made against him and he contested his termination in an arbitration proceeding. Prior to
the arbitrator issuing a ruling, the employer rehired the individual with the period during
which he was contesting his termination being converted to an unpaid suspension. Tr. at
228-229. Upon his return to work (2007), the individual’s access authorization was
reinstated and, after one year, the incident was purged from his personnel file. Stip. at 1.
The LSO cites the issuance of termination letter to evidence that the individual has a history
of violating work rules; however, the individual’s alleged workplace violation was set forth
in two different sections in the original Summary of Security Concerns and was stricken
from both. Ex. 34 at 1 (item I.A.4), 1-2 (item I.A.5), 10 (item IV.A.1). Since the LSO
removed the underlying conduct from consideration as security concern, I need not further
consider this issue. This is especially true in this case where the individual’s employment
and access authorization were reinstated nine years ago, without recurrence of similar
alleged behavior.
Mistakenly Allowing Unauthorized Access (2013). The individual acknowledges receiving
a written warning from his employer for mistakenly allowing a site employee access to a
limited area. Stip. at 1. From the time the individual was initially asked about the incident,
he has acknowledged his error. Following his employer’s evaluation of the incident, his
employer reconfigured the area where this incident occurred to reduce the chance of a
reoccurrence; such reconfiguration of the physical space also suggests that the original
configuration contributed to the individual’s error. Ex. 16 at 2, 4; Ex. 17 at 3. The individual
has not repeated the error. Tr. at 227. He has subsequently received an “excellence”
nomination from his employer for confiscating two expired badges, which supports his
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contention that he is diligent in protecting restricted areas from unauthorized access. Stip.
at 3; Ex. C. For these reasons, the behavior which led to the individual receiving a written
warning is unlikely to recur.
Possession of Government-Issued Cell Phone Within a Restricted Area (2015). In the
performance of his duties, the individual sometimes carries a government-issued cell phone
which is prohibited in sections of his work site. The individual acknowledges having
mistakenly entered a restricted area with a government cell phone in his pocket. Stip. at 1.
He credibly testified that that was the only instance that he had committed such a violation
in the prior nine years and he described the actions that he takes to prevent such incidents.
Tr. at 225-227.
Failure to Report Bankruptcy Filing to Security (2015). The individual acknowledges that
he filed a bankruptcy petition and, although he was aware of the requirement to report to
such filings to DOE, he failed to do so. Stip. at 3. Throughout his PSIs, the individual had
consistently stated that he wanted to resolve his financial issues without filing for
bankruptcy; this was collaborated by the personnel security specialist who testified at the
hearing on behalf of the LSO. Tr. at 93. However, when the individual commenced
working with a debt relief group in 2015 with respect to the modification of his mortgage,
his home was already in foreclosure and he was advised that he needed to file a “skeleton”
bankruptcy petition to stop the foreclosure. He filed the initial petition without the intent
to file any subsequent documents. This filing apparently stopped the mortgage foreclosure
in order that the individual could continue negotiating a mortgage modification. After the
filing, the individual continued to pay all of his financial obligations, other than his
mortgage which was already in foreclosure. Tr. at 204-209, 222-224. Since the individual
filed no subsequent documents, the bankruptcy court dismissed his petition (as was the
individual’s expectation) approximately three weeks after he filed the petition. Ex. 5 at 1.
The individual testified that he was aware of the requirements to report bankruptcy filings
to DOE; however, he did not understand that his “skeleton” filing, with no intent to file
subsequent documents or proceed towards bankruptcy relief, required DOE notification.
Tr. at 224.
The individual’s interpretation of the notification requirement is erroneous. See DOE Order
472.2 at Attachment 4. However, there is no indication that he was attempting to deceive
the LSO, which was regularly interviewing him with respect to his mortgage, or that he
was attempting to avoid or discharge any other indebtedness. As previously noted, I found
the individual highly credible, although not financially sophisticated. For these reasons, I
have concluded that the individual’s failure to notify DOE of his bankruptcy filing occurred
as a result of a genuine misunderstanding of the application of the requirement in his
atypical circumstances and, having been properly informed, is unlikely to recur.
Analysis of Security Concerns with Respect to Violations of Work Rules. As noted above,
I have concluded that the individual violated work rules in three instances – mistakenly
permitting unauthorized access (2013), possession a government cell phone in a restricted
area (2015), and failure to notify DOE of a bankruptcy filing (2015). Each incident
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occurred under unique circumstances, as described above, and it is unlikely that such
behavior will recur. Cf. Adjudicative Guidelines, Guideline E at ¶ 17(c). Although even a
single incident of violation of work rules, if sufficiently severe, could warrant termination
of access authorization, the individual has brought forward sufficient evidence and
testimony to resolve the concern that these incidents, whether considered individually or
in the aggregate, cast doubt on the individual’s honesty, reliability or trustworthiness. Cf.
Adjudicative Guidelines, Guideline F at ¶ 17(c).
Based upon the foregoing, I find that the individual has resolved the Criterion L security
concerns with respect to violations of work rules.
V. Conclusion
In the above analysis, I have found that there was sufficient derogatory information in the
possession of the DOE that raised serious security concerns under Criterion L. After
considering all the relevant information, favorable and unfavorable, in a comprehensive
common-sense manner, including weighing all the testimony and other evidence presented
at the hearing, I have found that the individual has brought forth sufficient evidence to
resolve the security concerns associated with Criterion L. Accordingly, I have determined
that the individual’s access authorization should be restored. The parties may seek review
of this Decision by an Appeal Panel under the regulations set forth at 10 C.F.R. § 710.28.
Wade M. Boswell
Administrative Judge
Office of Hearings and Appeals
Date: November 30, 2016