1 DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS In the matter of: ) ) ) ISCR Case No. 12-09243 ) Applicant for Security Clearance ) Appearances For Government: Andrea M. Corrales, Esq., Department Counsel For Applicant: Pro se ______________ Decision ______________ HEINY, Claude R., Administrative Judge: Applicant contests the Department of Defense’s (DoD) intent to deny his eligibility for a security clearance to work in the defense industry. He is delinquent on three collection accounts and two charged-off accounts, which total more than $19,000. There is no showing of payments having been made on the debts. Applicant has failed to mitigate the financial considerations security concerns. Clearance is denied. History of the Case Acting under the relevant Executive Order and DoD Directive,1 on May 11, 2015, the DoD issued a Statement of Reasons (SOR) detailing security concerns. On June 12, 2015, Applicant answered the SOR and elected to have the matter decided without a hearing. Defense Office of Hearings and Appeals (DOHA) Department Counsel (DC) 1 Executive Order 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended; DoD Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines (AG) effective within the DoD on September 1, 2006. 2 submitted the Government's case in a File of Relevant Material (FORM), dated July 27, 2015. The FORM contained six attachments (Items). On August 31, 2015, Applicant received a copy of the FORM, along with notice of his opportunity to file objections and submit material to refute, extenuate, or mitigate the potentially disqualifying conditions. As of November 6, 2015, no response or documents had been received. On December 1, 2015, I was assigned the case. Findings of Fact In Applicant’s Answer to the SOR, he admitted two student loans had been placed for collection totaling more than $19,000. He also admitted one collection account and two charged-off accounts, which totaled approximately $500. I incorporate Applicant’s admissions as facts. After a thorough review of the pleadings, exhibits, and submissions, I make the following additional findings of fact. Applicant is a 36-year-old manager who has worked for a defense contractor since November 2005 and seeks to obtain a security clearance. (Item 2) From October 2000 through October 2005, he honorably served in the U.S. Marine Corps. (Item 3) From July 2002 until July 2003, he served in Japan and from February 2004 through July 2004, he served in Iraq. (Item 6) In 2004, Applicant obtained student loans for classes at a technical school. In his July 2012 Personal Subject Interview (PSI), he acknowledge the student loan debts had been turned over to a collection agency. (Item 6) He stated he planned to pay off the $22,000 delinquent debts in August 2012 or September 2012. (Item 6) In his June 2012 SOR answer, he stated he was preparing to challenge the amount owed. (Item 2) The school had closed and he did not believe the owed the amount claimed. (Item 2) In Applicants July 2012 PSI, the $260 collection debt (SOR 1.a), the $119 charged-off debt (SOR 1.b), and the $143 charged-off debt (SOR 1.c) were discussed. (Item 6) At that time, he indicated he planned to satisfy the $260 and $143 debts. (Item 6) He also recognized the $119 car loan debt which he asserted his former spouse paid. (Item 6) In his SOR answer, he asserted the $260 debt and the $119 debt had been paid. No documents were received establishing payment of these debts. Applicant was put on notice in the FORM that he could submit a documentary response setting forth objections, rebuttal, extenuation, mitigation, or explanations. The FORM also indicated that he had provided no supporting documentation as to his assertions of payment. He provided no information concerning financial counseling, payment of his delinquent debts, or documents showing his finances were under control. He provided no indication as to his annual income or expenses. Policies When evaluating an applicant’s suitability for a security clearance, the administrative judge must consider the adjudicative guidelines. In addition to brief introductory explanations for each guideline, the adjudicative guidelines list potentially 3 disqualifying conditions and mitigating conditions, which must be considered in evaluating an applicant’s eligibility for access to classified information. These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, these guidelines are applied in conjunction with the factors listed in the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. According to AG ¶ 2(c), the entire process is a conscientious scrutiny of a number of variables known as the “whole-person concept.” The administrative judge must consider all available, reliable information about the person, past and present, favorable and unfavorable, in making a decision. The protection of national security is the paramount consideration. AG ¶ 2(b) requires that “[a]ny doubt concerning personnel being considered for access to classified information will be resolved in favor of national security.” In reaching this decision, I have drawn only those conclusions that are reasonable, logical, and based on the evidence contained in the record. Under Directive ¶ E3.1.14, the Government must present evidence to establish controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, the applicant is responsible for presenting “witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by applicant or proven by Department Counsel. . . .” The applicant has the ultimate burden of persuasion to obtain a favorable security decision. A person who seeks access to classified information enters into a fiduciary relationship with the Government predicated upon trust and confidence. This relationship transcends normal duty hours and endures throughout off-duty hours. The Government reposes a high degree of trust and confidence in individuals to whom it grants access to classified information. Decisions include, by necessity, consideration of the possible risk the applicant may deliberately or inadvertently fail to safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation of potential, rather than actual, risk of compromise of classified information. Section 7 of Executive Order (EO) 10865 provides that decisions shall be “in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.” See also EO 12968, Section 3.1(b) (listing multiple prerequisites for access to classified or sensitive information). Analysis Guideline F, Financial Considerations Adjudicative Guideline (AG) ¶ 18 articulates the security concerns relating to financial problems: 4 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. Additionally, an individual who is financially irresponsible may also be irresponsible, unconcerned, negligent, or careless in properly handling and safeguarding classified information. Behaving responsibly or irresponsibly in one aspect of life provides an indication of how a person may behave in other aspects of life. A person’s relationship with his or her creditors is a private matter until evidence is uncovered demonstrating an inability or unwillingness to repay debts as agreed. Absent substantial evidence of extenuating or mitigating circumstances, an applicant with a history of serious or recurring financial difficulties is in a position of risk that is inconsistent with holding a security clearance. An applicant is not required to be debt free, but is required to manage their finances to meet their financial obligations. Applicant has two student loan collection debts totaling more than $19,000. He also has three other delinquent debts totaling approximately $500. Disqualifying Conditions AG ¶ 19(a), “inability or unwillingness to satisfy debts” and AG ¶ 19(c), “a history of not meeting financial obligations,” apply. Five financial considerations mitigating conditions under AG ¶ 20 are potentially applicable: (a) the behavior happened so long ago, was so infrequent, or occurred under such circumstances that it is unlikely to recur and does not cast doubt on the individual's current reliability, trustworthiness, or good judgment; (b) the conditions that resulted in the financial problem were largely beyond the person's control (e.g., loss of employment, a business downturn, unexpected medical emergency, or a death, divorce or separation), and the individual acted responsibly under the circumstances; (c) the person has received or is receiving counseling for the problem and/or there are clear indications that the problem is being resolved or is under control; (d) the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts; and (e) the individual has a reasonable basis to dispute the legitimacy of the past-due debt which is the cause of the problem and provides 5 documented proof to substantiate the basis of the dispute or provides evidence of actions to resolve the issue. None of the mitigating factors for financial considerations extenuate the security concerns. Applicant’s financial difficulties are both recent and multiple. He has been employed with his current employer for 10 years. In July 2012, he was made aware of the Government’s concerns about his delinquent debt when his delinquent obligations were discussed during an interview. At that time, he acknowledged his debt and said he was planning on paying his delinquent student loans in August or September 2012. There is no evidence he did so. He has not acted responsibly in addressing his debts. Applicant provided no evidence he has received credit or financial counseling. He has provided no information as to his annual income, annual expenses, or demonstrated that his financial problems are under control. He has not shown he has a plan to bring his delinquent obligations under control. Without any payments having been established, he has failed to show he has made a good-faith effort to satisfy his debts. AG ¶ 20(a) does not apply because the delinquent debts remain unpaid, and because they remain unpaid, they are considered recent. There is nothing in the record supporting that conditions under which the debts were incurred were unusual. In July 2012, he was notified of the Government’s concern over his delinquent obligations. Given sufficient opportunity to address his financial delinquencies, Applicant has failed to act timely or responsibly under the circumstances. Failing to pay the debts casts doubt on his current reliability, trustworthiness, and good judgment. AG & 20(b) does not apply. Applicant provided no information concerning factors beyond his control. The mitigating condition listed in AG ¶ 20(c) does not apply. There has been no evidence Applicant has received financial counseling. There is no clear showing that his financial obligations are being addressed. The mitigating condition listed in AG ¶ 20(d) does not apply because Applicant has failed to document payment on any of the delinquent accounts. The mitigating condition listed in AG ¶ 20(e) does not apply because none of the delinquent obligations have been denied. Whole-Person Concept Under the whole-person concept, the administrative judge must evaluate an applicant’s eligibility for a security clearance by considering the totality of the applicant’s conduct and all relevant circumstances. The administrative judge should consider the nine adjudicative process factors listed at AG ¶ 2(a): (1) the nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the conduct, to include knowledgeable participation; (3) the frequency and recency of the conduct; (4) the individual’s age and maturity at the time of the conduct; (5) the extent to which participation is voluntary; (6) the presence or absence of rehabilitation and other permanent behavioral changes; (7) the motivation 6 for the conduct; (8) the potential for pressure, coercion, exploitation, or duress; and (9) the likelihood of continuation or recurrence. Under AG ¶ 2(c), the ultimate determination of whether to grant eligibility for a security clearance must be an overall commonsense judgment based upon careful consideration of the guidelines and the whole-person concept. I considered the potentially disqualifying and mitigating conditions in light of all the facts and circumstances surrounding this case. Applicant honorably served five years in the U.S. Marine Corps, serving in Japan and Iraq. However, he has failed to document any payment on his delinquent accounts. He has been aware of the Government’s concern about his delinquent debts since his July 2012 PSI and his July 2015 SOR. No delinquent debts have been paid and there is no documentation Applicant has recently contacted his creditors. In requesting an administrative determination, Applicant chose to rely on the written record. In so doing, however, he failed to submit sufficient information or evidence to supplement the record with relevant and material facts regarding his circumstances and facts that would mitigate the financial considerations security concerns. He failed to offer evidence of financial counseling or provide documentation regarding his past efforts to address his delinquent debt. He failed to provide such information, and by relying solely on the scant explanation in response to the SOR, he failed to mitigate the financial considerations security concerns. This decision should not be construed as a determination that Applicant cannot or will not attain the state of true reform and rehabilitation necessary to justify the award of a security clearance. The awarding of a security clearance is not a once in a lifetime occurrence, but is based on applying the factors, both disqualifying and mitigating, to the evidence presented. Under Applicant=s current circumstances, a clearance is not recommended. In the future, if Applicant has paid his delinquent obligations, established compliance with a repayment plan, or otherwise substantially addressed his past-due obligations, he may well demonstrate persuasive evidence of his security worthiness. However, a clearance at this time is not warranted. Overall, the record evidence leaves me with substantial doubt as to Applicant’s eligibility and suitability for a security clearance. For all these reasons, I conclude Applicant has not mitigated the financial considerations security concerns. Formal Findings Formal findings for or against Applicant on the allegations set forth in the SOR, as required by Section E3.1.25 of Enclosure 3 of the Directive, are: Paragraph 1, Financial Considerations: AGAINST APPLICANT Subparagraphs 1.a – 1.e: Against Applicant 7 Conclusion In light of all of the circumstances presented by the record in this case, it is not clearly consistent with the national interest to grant Applicant a security clearance. Eligibility for access to classified information is denied. _______________________ CLAUDE R. HEINY II Administrative Judge