1 DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS In the matter of: ) ) [Redacted] ) ISCR Case No. 16-01238 ) Applicant for Security Clearance ) Appearances For Government: Philip J. Katauskas, Esq., Department Counsel For Applicant: Pro se ______________ Decision ______________ FOREMAN, LeRoy F., Administrative Judge: This case involves security concerns raised under Guideline F (Financial Considerations). Eligibility for access to classified information is denied. Statement of the Case Applicant submitted a security clearance application on September 30, 2015. On June 20, 2016, the Department of Defense (DOD) sent him a Statement of Reasons (SOR), alleging security concerns under Guideline F. The DOD acted under Executive Order (Exec. Or.) 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended; Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines (AG) implemented by DOD on September 1, 2006.1 1 Security Executive Agent Directive 4 (SEAD 4), was issued on December 10, 2016, revising the 2006 adjudicative guidelines. The SEAD 4 guidelines apply to all adjudicative decisions issued on or after June 8, 2017. My decision is based on the guidelines in SEAD 4, referred to in this decision as “AG.” The changes resulting from issuance of SEAD 4 did not affect my decision in this case. 2 Applicant answered the SOR on July 16, 2016, and requested a decision on the record without a hearing. Department Counsel submitted the Government’s written case on August 25, 2016. A complete copy of the file of relevant material (FORM) was sent to Applicant, who was given an opportunity to file objections and submit material to refute, extenuate, or mitigate the Government’s evidence. He received the FORM on August 31, 2016, but did not respond. The case was assigned to me on June 1, 2017. Findings of Fact2 In his answer to the SOR, Applicant admitted the allegations in SOR ¶¶ 1.a, 1.b, and 1.d. He denied the allegation in SOR ¶ 1.c. His admissions in are incorporated in my findings of fact. Applicant is a 57-year-old logistics management analyst employed by a defense contractor since November 2003. He graduated from college in May 1994 with a bachelor’s degree. He married in July 1994. He and his wife have four children, ages 23, 20, 16, and 14. He received a security clearance in August 2004. Applicant’s October 2015 credit bureau report (CBR) reflected two judgments filed against him in July 2012 for $4,883 (SOR ¶ 1.b) and in June 2014 for $2,770 (SOR ¶ 1.a). Both judgments were obtained by the homeowners’ association for Applicant’s neighborhood, and both are unsatisfied. In his answer to the SOR, he stated that he had a payment agreement for both judgments and that a copy of the payment agreement was attached to his answer. No documents were attached to his answer. In the FORM, Department Counsel specifically pointed out that no payment agreements were attached to the answer. Applicant did not respond to the FORM. Applicant’s March 2015 and June 2016 CBRs reflect a delinquent medical bill for $148 (SOR ¶ 1.c). In the March 2015 CBR, the creditor is not named and the collection agency is not identified. In the June 2016 CBR, the creditor is listed as “Medical/Health Care” and the account owner is listed as “Individual account.” There is no contact information listed in either CBR. The debt became delinquent in March 2010 and was referred for collection in November 2010. In his answer to the SOR, Applicant denied this debt and stated that he was unable to find this debt in his credit report. He stated his intention to pay it if he receives a bill for it. There is no evidence that he has disputed the debt with any of the credit bureaus or has attempted to identify the creditor. Applicant’s October 2015 CBR listed a credit-card account charged off for $6,555 in April 2010 (SOR ¶ 1.d). He admitted the debt, stated that the account was opened without his knowledge, and stated that he “had been back and forth with the original account holder.” The March 2015 and June 2016 CBRs reflect that he is an authorized user on this account. 2 Applicant’s personal information is extracted from his security clearance application (GX 1) unless otherwise indicated by a parenthetical citation to the record. 3 Policies “[N]o one has a ‘right’ to a security clearance.” Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). As Commander in Chief, the President has the authority to “control access to information bearing on national security and to determine whether an individual is sufficiently trustworthy to have access to such information.” Id. at 527. The President has authorized the Secretary of Defense or his designee to grant applicants eligibility for access to classified information “only upon a finding that it is clearly consistent with the national interest to do so.” Exec. Or. 10865 § 2. Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the adjudicative guidelines. These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, an administrative judge applies these guidelines in conjunction with an evaluation of the whole person. An administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. An administrative judge must consider all available and reliable information about the person, past and present, favorable and unfavorable. The Government reposes a high degree of trust and confidence in persons with access to classified information. This relationship transcends normal duty hours and endures throughout off-duty hours. Decisions include, by necessity, consideration of the possible risk that the applicant may deliberately or inadvertently fail to safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation about potential, rather than actual, risk of compromise of classified information. Clearance decisions must be made “in terms of the national interest and shall in no sense be a determination as to the loyalty of the applicant concerned.” Exec. Or. 10865 § 7. Thus, a decision to deny a security clearance is merely an indication the applicant has not met the strict guidelines the President and the Secretary of Defense have established for issuing a clearance. Initially, the Government must establish, by substantial evidence, conditions in the personal or professional history of the applicant that may disqualify the applicant from being eligible for access to classified information. The Government has the burden of establishing controverted facts alleged in the SOR. See Egan, 484 U.S. at 531. “Substantial evidence” is “more than a scintilla but less than a preponderance.” See v. Washington Metro. Area Transit Auth., 36 F.3d 375, 380 (4th Cir. 1994). The guidelines presume a nexus or rational connection between proven conduct under any of the criteria listed therein and an applicant’s security suitability. See ISCR Case No. 92-1106 at 3, 1993 WL 545051 at *3 (App. Bd. Oct. 7, 1993). Once the Government establishes a disqualifying condition by substantial evidence, the burden shifts to the applicant to rebut, explain, extenuate, or mitigate the facts. Directive ¶ E3.1.15. An applicant has the burden of proving a mitigating condition, 4 and the burden of disproving it never shifts to the Government. See ISCR Case No. 02- 31154 at 5 (App. Bd. Sep. 22, 2005). Applicants have the “ultimate burden” of demonstrating that they meet the qualifications for a security clearance. ISCR Case No. 01-20700 at 3 (App. Bd. Dec. 19, 2002). “[S]ecurity clearance determinations should err, if they must, on the side of denials.” Egan, 484 U.S. at 531; see AG ¶ 2(b). Analysis Guideline F, Financial Considerations The security concern under this guideline is set out in AG ¶18: Failure 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 or sensitive information. Financial distress can also be caused or exacerbated by, and thus can be a possible indicator of, other issues of personnel security concern such as excessive gambling, mental health conditions, substance misuse, or alcohol abuse or dependence. An individual who is financially overextended is at greater risk of having to engage in illegal or otherwise questionable acts to generate funds . . . . This concern is broader than the possibility that a person might knowingly compromise classified information to raise money. It encompasses concerns about a person’s self-control, judgment, and other qualities essential to protecting classified information. A person who is financially irresponsible may also be irresponsible, unconcerned, or negligent in handling and safeguarding classified information. See ISCR Case No. 11-05365 at 3 (App. Bd. May 1, 2012). The evidence shows that Applicant is an authorized user on the account alleged in SOR ¶ 1.d. As such he is not legally liable for payment of the amount due. However, his admissions and the evidence in the FORM establish the debts alleged in SOR ¶¶ 1.a-1.c and raise the three disqualifying conditions: AG ¶ 19(a) (“inability to satisfy debts”); AG ¶ 19(b) (“unwillingness to satisfy debts regardless of the ability to do so”); and AG ¶ 19(c) (“a history of not meeting financial obligations”). The following mitigating conditions are potentially relevant: AG ¶ 20(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; 5 AG ¶ 20(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, a death, divorce or separation, clear victimization by predatory lending practices, or identity theft), and the individual acted responsibly under the circumstances; AG ¶ 20(c): the individual has received or is receiving financial counseling for the problem from a legitimate and credible source, such as a non-profit credit counseling service, and there are clear indications that the problem is being resolved or is under control; AG ¶ 20(d): the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts; and AG ¶ 20(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 documented proof to substantiate the basis of the dispute or provides evidence of actions to resolve the issue. AG ¶ 20(a) is not established. Applicant’s delinquent debts are recent, numerous, and were not incurred under circumstances making them unlikely to recur. AG ¶ 20(b) is not established. Applicant has not submitted sufficient information to determine whether any of the debts alleged in the SOR were due to conditions beyond his control. AG ¶ 20(c) is not established. Applicant submitted no evidence of financial counseling and his financial situation is not under control AG ¶ 20(d) is not established. Applicant submitted no evidence of payments on the debts alleged in SOR ¶ 1.c and 1.d. In his answer to the SOR, he claimed that he had a payment arrangement for the judgments alleged in SOR ¶ 1.a and 1.b, but his answer did not include any documents reflecting an agreement. Applicant had an opportunity to document any payment agreements when he received the FORM, which specifically pointed out the lack of documentation, but he did not avail himself of this opportunity. Although pro se applicants are not expected to act like lawyers, they are expected to take timely and reasonable steps to protect their rights under the Directive. ISCR Case No. 12-10810 at 2 (App. Bd. Jul. 12, 2016). Applicants who claim that debts have been resolved are expected to present documentary evidence supporting their claims. See, e.g., ISCR Case No. 15-03363 at 2 (App. Bd. Oct. 19, 2016). AG ¶ 20(e) is not established. Although Applicant denied the debt alleged in SOR ¶ 1.c, he has not attempted to identify the creditor and he has not disputed the debt with any of the credit bureaus. He claimed that the account alleged in SOR ¶ 1.d was opened without his knowledge, and he admitted it in his answer to the SOR. His March 2015 and June 2016 CBRs reflect that he is an authorized user on the account and not 6 legally liable for the debt. However, he has not disputed it with the creditor or any of the credit bureaus. Whole-Person Concept 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. Because Applicant requested a determination on the record without a hearing, I had no opportunity to evaluate his credibility and sincerity based on demeanor. See ISCR Case No. 01-12350 at 3-4 (App. Bd. Jul. 23, 2003). After weighing the disqualifying and mitigating conditions under Guideline F, and evaluating all the evidence in the context of the whole person, I conclude Applicant has not mitigated the security concerns raised by his delinquent debts. Accordingly, I conclude he has not carried his burden of showing that it is clearly consistent with the national security interests of the United States to grant him eligibility for access to classified information. Formal Findings I make the following formal findings on the allegations in the SOR: Paragraph 1, Guideline F (Financial Considerations): AGAINST APPLICANT Subparagraphs 1.a-1.c: Against Applicant Subparagraph 1.d: For Applicant Conclusion I conclude that it is not clearly consistent with the national security interests of the United States to grant Applicant eligibility for access to classified information. Clearance is denied. LeRoy F. Foreman Administrative Judge