DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
---------------------------------- )       ISCR Case No. 12-03451
           )
Applicant for Security Clearance )
Appearances
For Government: Daniel F. Crowley, Department Counsel
For Applicant: Pro se
May 9, 2014
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Decision
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LOKEY ANDERSON, Darlene D., Administrative Judge:
The Applicant submitted his Electronic Questionnaire for Investigations
Processing (e-QIP) on November 11, 2011.  (Government Exhibit 4.)  On September
11, 2013, the Department of Defense (DoD), pursuant to Executive Order 10865 and
Department of Defense Directive 5220.6 (Directive), dated January 2, 1992, (as
amended), issued a Statement of Reasons (SOR) to the Applicant, which 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 the Applicant and recommended referral to an Administrative
Judge to determine whether clearance should be denied or revoked.
The Applicant responded to the SOR in writing on October 12, 2013, in which he
elected to have the case determined on a written record in lieu of a hearing.
Department Counsel submitted the Government’s File of Relevant Material (FORM) to
the Applicant on or about December 9, 2013.  The Applicant received the FORM on
December 18, 2013.  The Applicant was instructed to submit information in rebuttal,
extenuation or mitigation within 30 days of receipt.  The Applicant submitted a reply to
the FORM on January 16, 2014.  This case was assigned to the undersigned on April
11, 2014.  Based upon a review of the pleadings and exhibits, eligibility for access to
classified information is denied.   
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 FINDINGS OF FACT
The Applicant is 52 years old, and although he was separated from his second
wife, they have reconciled.  He has a Master’s Degree.  He is employed with a defense
contractor as a Desktop Support Specialist and is seeking to obtain a security clearance
in connection with this employment.
The Government opposes the Applicant's request for a security clearance, on the
basis of allegations set forth in the Statement of Reasons (SOR).  The following findings
of fact are entered as to each paragraph and guideline in the SOR:
Paragraph 1 (Guideline F - Financial Considerations)  The Government alleges that the
Applicant is ineligible for clearance because he is financially overextended and at risk of
having to engage in illegal acts to generate funds.      
The Applicant admitted each of the allegations set forth in the SOR under this
guideline.  (Government Exhibit 2.)  Credit Reports of the Applicant dated November 3,
2009; November 23, 2011; and July 5, 2013, reflect that the Applicant is indebted to
nine separate creditors in an amount totaling in excess of $32,000.  (Government
Exhibits 6, 9 and 10.)  Most of the delinquencies are credit cards and consumer debt.  
Applicant served on active duty in the United States Navy from August 1979 to
May 1983.  Following that, Applicant worked for several employers before he began
working for his current employer in January 2007.  He has held a security clearance
with his current employer since 2010.  
Applicant fell behind on his bills, and accumulated credit card and consumer debt
that he could not afford to pay.  The following debts remain outstanding:  1.(a) a medical
debt owed to a creditor in the amount of $11,397.  1.(b) a debt owed to a creditor in the
amount of $2,346. 1.(c) a debt owed  to a bank in the amount of $4,786.  1.(d) a debt
owed to a creditor in the amount of $2,125; 1.(e) a judgment entered against the
Applicant by a bank in the amount of $5,564.  1.(f) a judgement entered against the
Applicant by a bank in the amount of $3,615.  1.(g) a debt owed to a creditor in the
amount of $711.  1.(h) a debt owed to a gasoline company in the amount of $1,377.
1.(i) a debt owed to a creditor in the amount of $811.  
Applicant gives no explanation as to why or how he became indebted in the first
place.  He hired a debt management service to negotiate reduced balances and make
payments to resolve his delinquent debts.  (Government Exhibit 11.)  He explained that
instead of having to make several payments toward various creditors, his objective was
to consolidate his debt into one source, and make one payment that is easier to
manage.  He paid $177 monthly for them to handle his delinquent accounts for him.  At
some point, he began receiving collection calls from creditors, and learned that the
monthly payments that he was sending to the company were not being used to resolve
his debts.  He stopped paying the debt management firm.    
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In August 2013 Applicant sent each of his creditors a letter with a settlement
offer.  A few of the creditors responded while others did not.  Applicant claims that he is
still working on resolving his delinquent accounts.  (Applicant’s Reply to the FORM.)
Even so, Applicant has failed to submit any evidence beyond this to show that he has
started making payments toward the debt or that he has resolved it.  He has not
produced a receipt or statement from a creditor confirming that the debt has been paid
or a settlement reached, a cancelled check, or a new credit bureau report showing final
payment.   
Applicant’s personal financial statement dated July 28, 2013, indicates that after
paying his regular monthly expenses, he has a net monthly remainder of $553, which
could be used to pay his delinquent debt.  Applicant states that his intention is to pay his
debt off.  There is no evidence, however, demonstrating that he has paid off anything, or
that he has made any payments to reduce his debt. 
Paragraph 2 (Guideline E - Personal Conduct).  The Government alleges that the
Applicant is ineligible for clearance because he has engaged in conduct involving
questionable judgment, lack of candor, dishonesty, or unwillingness to protect classified
information.  Of special interest is any failure to provide truthful and candid answers
during the security clearance process or any other failure to cooperate with the security
clearance process.  
Applicant denied allegation 2.(a), but admitted 2.(b) set fort in the SOR under this
guideline.  Applicant completed a security clearance application dated September 11,
2011, and answered, “NO,” to a series of questions concerning his finances.
(Government Exhibit 4.)  Section 26: have any of the following happened? In the past
seven years, have you had bills or debts turned over to a collection agency? Have you
had any account or credit card suspended, charged off or cancelled for failing to pay as
agreed? Have you been over 120 days delinquent on any debt?  The Applicant
answered, “NO,” to each of the questions.  (Government Exhibit 4.)  These were false
responses.  He failed to list seven of the nine delinquent debts set forth in 1.b., 1.c.,
1.d., 1.e., 1.,g.,1.h., and 1.i., of the SOR.  (See Applicant’s Answer to SOR.)  
Applicant claims that at the time he completed the security clearance application,
he did not know that his debt had become so negative.  He believed that because he
had hired the debt management company, his financial matters were being handled.
He further claims that he had not received notices from the creditors to indicate that his
credit had become seriously delinquent.  (Applicant’s Reply to the FORM.)    
In November 2003, Applicant was charged with two counts of Grand Larceny, a
felony.  Applicant stated that he was in serious financial crisis with student loans and
other bills at the time.  He was working as a part-time security guard in the evenings,
when he and a coworker decided to steal a video projector from work with the intention
of obtaining a small loan on it or selling it outright for profit.  Applicant and his coworker
took it to a pawn shop and each received $700.  Applicant then paid the remainder of
rent that was due and several insistent creditors.  Before he was able to buy back the
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projector, it was noticed missing and he was arrested.  He pled guilty to one count of
Grand Larceny, a felony, in October 2004. He was sentenced to three years probation,
ordered to complete 100 hours of community service and ordered to pay $4,500 in
restitution.  (Government Exhibit 8.)  Applicant has since satisfied all of his sentencing
requirements associated with this conviction.  Applicant contends that he disclosed this
information to the investigators in 2009, and on his 2009 security clearance application.
POLICIES
Enclosure 2 of the Directive sets forth adjudication policies divided into
"Disqualifying Factors" and "Mitigating Factors."  The following Disqualifying Factors
and Mitigating Factors are found to be applicable in this case:
Guideline F (Financial Considerations)
18.  The Concern.  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.  An individual who
is financially overextended is at risk of having to engage in illegal acts to generate
funds. 
Conditions that could raise a security concern:
19.(a) inability or unwillingness to satisfy debts; and
19.(c) a history of not meeting financial obligation. 
Conditions that could mitigate security concerns:
None.
Guideline E (Personal Conduct)
15.  The Concern.  Conduct involving questionable judgment, lack of candor,
dishonesty, or unwillingness to comply with rules and regulations can raise questions
about an individual’s reliability, trustworthiness and ability to protect classified
information.  Of special interest is any failure to provide truthful and candid answers
during the security clearance process or any other failure to cooperate with the security
clearance process.
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Conditions that could raise a security concern:
16.(a) deliberate omission, concealment, or falsification of relevant facts from any
personnel security questionnaire, personal history statement, or similar form used to
conduct investigations, determine employment qualifications, award benefits or status,
determine security clearance eligibility or trustworthiness, or award fiduciary
responsibilities;
16.(c) credible adverse information in several adjudicative issue areas that is not
sufficient for an adverse determination under any other single guideline, but which,
when considered as a whole, supports a whole-person assessment of questionable
judgement, untrustworthiness, unreliability, lack of candor, questionable judgment,
untrustworthiness, unreliability, lack of candor, unwillingness to comply with rules and
regulations, or other characteristics indicating that the person may not properly
safeguard protected information.
Conditions that could mitigate security concerns:
None.
In addition, as set forth in Enclosure 2 of the Directive at pages 18-19,  in
evaluating the relevance of an individual’s conduct, the Administrative Judge should
consider the following general factors:
a.  The nature, extent, and seriousness of the conduct and surrounding
circumstances;
     b.  The circumstances surrounding the conduct, to include knowledgeable
participation;
c.  The frequency and recency of the conduct;
d.  The individual’s age and maturity at the time of the conduct;
e.  The extent to which participation is voluntary;
f.  The presence or absence of rehabilitation and other permanent behavior
changes;
 
g.  The motivation for the conduct; 
h. The potential for pressure, coercion, exploitation or duress; and
 i.  The likelihood of continuation or recurrence.
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The eligibility criteria established in the DoD Directive identify personal
characteristics and conduct, which are reasonably related to the ultimate question,
posed in Section 2 of Executive Order 10865, of whether it is “clearly consistent with the
national interest” to grant an Applicant’s request for access to classified information.
The DoD Directive states, “The adjudicative process is an examination of a
sufficient period of a person’s life to make an affirmative determination that the person is
an acceptable security risk.  Eligibility for access to classified information is predicated
upon the individual meeting these personnel security guidelines.  The adjudicative
process is the careful weighing of a number of variables known as the whole-person
concept.  Available, reliable information about the person, past and present, favorable
and unfavorable should be considered in reaching a determination.” The Administrative
Judge can draw only those inferences or conclusions that have reasonable and logical
basis in the evidence of record.  The Judge cannot draw inferences or conclusions
based on evidence, which is speculative or conjectural in nature.  Finally, as
emphasized by President Eisenhower in Executive Order 10865, “Any determination
under this order . . . shall be a determination in terms of the national interest and shall in
no sense be a determination as to the loyalty of the Applicant concerned.”
CONCLUSIONS
In the defense industry, the security of classified industrial secrets is entrusted to
civilian workers who must be counted upon to safeguard such sensitive information
twenty-four hours per day, seven days per week.  The Government is therefore
appropriately concerned when available information indicates that an Applicant for
clearance may be involved in instances of financial irresponsibility, dishonesty or
conduct  which demonstrates poor judgment or unreliability.
It is the Government’s responsibility to present substantial evidence to support
the finding of a nexus, or rational connection, between the Applicant’s conduct and the
holding of a security clearance.  If such a case has been established, the burden then
shifts to the Applicant to go forward with evidence in rebuttal, explanation or mitigation,
which is sufficient to overcome or outweigh the Government’s case.  The Applicant
bears the ultimate burden of persuasion in proving that it is clearly consistent with the
national interest to grant him or her a security clearance.
In regard to his personal conduct, Applicant sought to conceal his financial
history from the Government by intentionally omitting this information from his security
clearance application.  At the time he completed the application in 2011, he knew or
should have known that he had a number of delinquent debts of concern.  In fact he
knew that he had delinquent debt since he took it upon himself to hire the debt
consolidation firm.  He also knew at the time he completed the application that his debts
were not fully resolved since he was still making monthly payments to the debt
consolidation firm.  The only reasonable conclusion for not revealing the truth
concerning his delinquent debts is that he did not want the Government to know about
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them.  There is no excuse for this misconduct.  I find that he deliberately concealed the
information from the Government on the application.  
Applicant’s felony conviction for Grand Larceny shows poor judgment,
unreliability and untrustworthiness.  Applicant worked for his employer as a security
guard and was hired for the specific purpose of protecting his employer’s property.
Applicant was entrusted to protect the premises, not to steal from them.  He took
advantage of his privileges and stole from his employer because he had financial
problems he could not resolve lawfully.  Since 2003, little has changed with respect to
the Applicant’s finances.  He had financial problems in 2003, and he continues to have
them now.  There is nothing in the record that demonstrates any change in his financial
habits.  This type of misconduct is what the Government is trying to protect against by
placing such strict requirements on security clearance eligibility.  Although Applicant’s
conviction occurred in 2004, almost ten years ago, and has not recurred, the conduct is
so egregious in nature, and since the Applicant remains excessively indebted, the
conduct has not been mitigated.     
 
Under Guideline E (Personal Conduct), Disqualifying Condition 16.(a) deliberate
omission, concealment, or falsification of relevant facts from any personnel security
questionnaire, personal history statement, or similar form used to conduct
investigations, determine employment qualifications, award benefits or status,
determine security clearance eligibility or trustworthiness, or award fiduciary
responsibilities, and 16.(c) credible adverse information in several adjudicative issue
areas that is not sufficient for an adverse determination under any other single
guideline, but which, when considered as a whole, supports a whole-person
assessment of questionable judgement, untrustworthiness, unreliability, lack of candor,
unwillingness to comply with rules and regulations, or other characteristics indicating
that the person may not properly safeguard protected information apply.  None of the
mitigating conditions are applicable.  Accordingly, I find against the Applicant under
Guideline E (Personal Conduct).
Furthermore, the Government has met its initial burden of proving that the
Applicant has been financially irresponsible (Guideline F).  The evidence indicates poor
judgment, unreliability, and untrustworthiness on the part of the Applicant.  Because of
the scope and nature of the Applicant's conduct, I conclude there is a nexus or
connection with his security clearance eligibility.
Applicant’s history of financial indebtedness has not been mitigated.  He remains
excessively indebted.  Applicant has not started the process of resolving his debts and
has a long way to go to demonstrate that he is fiscally responsible.           
   It is acknowledged that the debt management firm caused the Applicant some
delay in resolving his debts.  However, several years have passed since then, and not
much has been done.  Applicant must show that he can and will resolve his debts.  In
this case, there is no evidence that he can do so.  He has not shown an ability to pay all
of his delinquent debts or live within his means.  At this time, there is insufficient
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evidence of financial rehabilitation.  Applicant has not demonstrated that he can
properly handle his financial affairs. 
Applicant has not met his burden of proving that he is worthy of a security
clearance.  Assuming that he continues to work to resolve his debts, and then shows
that he has not acquired any new debt that he is unable to pay, he may be eligible for a
security clearance in the future.  However, not at this time.  Considering all of the
evidence, the Applicant has not introduced persuasive evidence in rebuttal, explanation
or mitigation that is sufficient to overcome the Government's case. 
Under Guideline F (Financial Considerations), Disqualifying Conditions 19.(a)
inability or unwillingness to satisfy debts; and 19.(c) a history of not meeting financial
obligations, apply.  None of the mitigating conditions are applicable.  There are simply
too many delinquent debts that are not being addressed.  Accordingly, I find against the
Applicant under Guideline F (Financial Considerations).    
I have also considered the “whole-person concept” in evaluating the Applicant’s
eligibility for access to classified information.  Under the particular facts of this case, the
totality of the conduct set forth above, when viewed under all of the guidelines as a
whole, support a whole-person assessment of poor judgement, untrustworthiness,
unreliability, a lack of candor, an unwillingness to comply with rules and regulations,
and/or other characteristics indicating that the person may not properly safeguard
classified information.
  
I have considered all of the evidence presented.  It does not mitigate the negative
effects of his financial indebtedness and his personal conduct, and the effects it can
have on his ability to safeguard classified information.  On balance, it is concluded that
the Applicant has not overcome the Government's case opposing his request for a
security clearance.  Accordingly, the evidence supports a finding against the Applicant
as to the factual and conclusionary allegations expressed in Paragraphs 1 and 2 of the
SOR.   
     FORMAL FINDINGS
Formal findings For or Against the Applicant on the allegations in the SOR, as
required by Paragraph 25 of Enclosure 3 of the Directive are:
Paragraph 1:       Against the Applicant.
Subpara.  1.a.          Against  the Applicant.   
Subpara.  1.b.         Against the Applicant.
Subpara.  1.c.           Against  the Applicant. 
Subpara.  1.d.          Against  the Applicant.   
Subpara.  1.e.         Against the Applicant.
Subpara.  1.f.           Against  the Applicant. 
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Subpara.  1.g.          Against  the Applicant.   
Subpara.  1.h.         Against the Applicant.
Subpara.  1.i.           Against  the Applicant. 
Paragraph 2:                  Against the Applicant.
    Subpara.  2.a.               Against the Applicant.
Subpara.  2.b.               Against the Applicant.
DECISION
In light of all the circumstances presented by the record in this case, it is not
clearly consistent with the national interest to grant or continue a security clearance for
the Applicant.
  Darlene Lokey Anderson
Administrative Judge