1 DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS In the matter of: ) ) ) ADP Case No. 16-03657 ) Applicant for Position of Trust ) Appearances For Government: Caroline E. Heintzelman, Department Counsel For Applicant: Pro se __________ Decision __________ DAM, Shari, Administrative Judge: Applicant mitigated the trustworthiness concerns raised under the guidelines for financial considerations and personal conduct. National security eligibility for a position of trust is granted. History of the Case On April 15, 2016, Applicant submitted an Electronic Questionnaires for Investigations Processing (e-QIP). On January 25, 2017, the Department of Defense Consolidated Adjudications Facility (DoD CAF) issued to Applicant a Statement of Reasons (SOR), alleging security concerns under Guideline F, Financial Considerations, and Guideline E, Personal Conduct. The action was taken under DoD Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive); and the previous Adjudicative Guidelines (AG) effective on September 1, 2006. This decision applies the new AGs that became effective on June 8, 2017.1 Applicant answered the SOR in writing on February 4, 2017 (Answer), and requested a hearing before an administrative judge. The Defense Office of Hearings and 1 I considered the previous AG, as well as the new AG, in reaching this Decision. My decision would be the same under either set of guidelines. 2 Appeals (DOHA) assigned the case to me on March 20, 2017. It issued a Notice of Hearing on May 2, 2017, scheduling the hearing for May 16, 2017. Applicant confirmed receipt of the Notice of Hearing on May 2, 2017, by email.2 The hearing convened as scheduled. Department Counsel offered Government Exhibits (GE) 1 through 5 into evidence. Applicant testified, but did not present any exhibits. The GE were admitted without objection. DOHA received the hearing transcript (Tr.) on May 24, 2017. The record remained open until August 21, 2017, to give Applicant an opportunity to provide exhibits and any other relevant information. Applicant timely submitted 30 pages of documents that I marked as Applicant Exhibits (AE) A through E, and admitted without objection from Department Counsel. Findings of Fact Applicant admitted the eight financial allegations in the SOR and denied the two personal conduct allegations. Her admissions are incorporated into these findings. Applicant is 32 years old and unmarried. She has two children, ages 13 and 16. She is the sole provider for her children. Applicant earned an associate’s degree in 2009. She started working for a defense contractor in 2014. (Tr. 11-13.) She has been employed for the past ten years at full and part-time positions. (Tr. 36; GE 1.) Applicant began experiencing financial problems after her first child was born and she was unable to pay child care costs. She does not recall if she was employed at the time, as she was about 15 years old. She explained that she came from a poor background and had no education in managing finances. She did not begin to become financially aware until her late 20’s, when she enrolled in a government program that provided some financial counseling. (Tr. 14-16.) In 2011, she was homeless for a few months and lived in a shelter with her children, which added to her financial delinquencies. (Tr. 18.) Applicant submitted a draft budget. She earns $15.75 per hour. Her bi-weekly net income is between $1,100 and $1,300. She does not receive child support. She lives in a single household. She has a couple hundred dollars left at the end of the month after paying expenses. (Tr. 29-32; AE D.) She has periodically sought financial counseling with a debt management company, once in March 2014 when she used the company’s services for several months to pay debts, and then again in early 2017, when she again sought help resolving debts. She deposits about $60 a month into the debt management program. Since starting her current position, she has some money in a savings account and started contributing to a retirement fund in 2016. (Tr. 32-35.) Based on credit bureau reports (CBR) from March 2017 and May 2016, the SOR alleged eight delinquent debts that became delinquent between 2010 and 2015. They total $27,260, of which $23,260 are for three medical debts. (GE 3, GE 4.) The status of each debt is as follows: 2 Applicant’s email is attached as Hearing Exhibit (HE) 1. 3 1. (SOR ¶ 1.a) Applicant stated that the $2,449 cell phone debt is not her debt. She said that her former boyfriend stole her personal information and used it for identify theft. She is trying to get help resolving the debt through the debt management company. (Tr. 39-41.) 2. (SOR ¶ 1.b) The $356 debt is owed to a utility company. (Tr. 42.) 3. (SOR ¶ 1.c) The $690 debt is an old debt owed to a child care center. Applicant has made payments on the debt in 2014, 2015, 2016, and 2017. The balance is $465. It is now being resolved through monthly payments. (Tr. 42; AE B, AE C.) 4. (SOR ¶ 1.d) The $499 debt is to a payday loan. It became delinquent in 2013. She intends to resolve it. (Tr. 32, 43.) 5. (SOR ¶ 1.e) The $256 debt is owed to a gas company. Applicant denies that she owes the debt. She said it was resolved, and she is a current customer of that company and has no balance. (Tr. 32.) 6-8. (SOR ¶¶ 1.f, 1.g, 1.h) These three medical debts for $4,825, $18,435, and $345 arose in 2015 when she was in a car accident and did not have medical insurance. She thought she qualified for medical assistance at that time, but learned that she did not. In September 2016, she completed a financial statement for the creditor, and is asking for a forgiveness agreement for these medical bills. She said she faxed the information to the creditor twice. (Tr. 38, 45-46, 55; AE C.) Applicant provided information that she paid a $440 educational loan (not alleged in the SOR) in November 2015 through monthly payments beginning in 2014. (AE B.) In April 2017, she started making monthly payments of $30 on a $1,229 medical debt, which may be separate from the SOR-alleged medical debts or included in them. (AE C.) Applicant’s student loans are in a “deferred” or “pays as agreed” status. (GE 3.) In her March 2017 CBR, a new medical debt for $1,590 from May 2016 is listed. Applicant is unfamiliar with that debt.3 (Tr. 56-57; GE 3.) When she completed “Section 22: Police Record” of her 2016 e-QIP, Applicant failed to disclose a 2002 arrest for battery, disorderly conduct, and use of dangerous weapon. She stated that the incident occurred when she was 17 years old, and she did not know she was arrested. She and two other young girls became embroiled in an altercation when a policeman came to the scene. All of them were given disorderly conduct tickets. She answered the question accurately, based on her recollection of the circumstances and because the incident was not a felony. She denied that she had a dangerous weapon with her. She has not been involved in any criminal conduct since that incident. (Tr. 59-64.) 3 The SOR did not allege this debt and it will not be considered for disqualifying conditions. However, it may be considered in the analysis of the mitigating conditions, the whole-person concept, and the evaluation of Applicant’s credibility. 4 When she completed “Section 26: Financial” in her 2016 e-QIP, Applicant failed to disclose any of her delinquent SOR debts. She explained that she knew she had some debts when she was filling out the e-QIP, but could not remember the specifics. She did not intentionally mislead the Government. During a subsequent background interview, she volunteered information about her delinquent debts. (Tr. 57- 58.) Applicant submitted emails from her supervisor complimenting her on her work and customer service. She was also congratulated for having met or exceeded her goals for some months. (AE E.) Policies When evaluating an applicant’s national security eligibility, the administrative judge must consider the disqualifying and mitigating conditions in the AGs. 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 AG ¶ 2, describing the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. 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 the national security is the paramount consideration. AG ¶ 2(b) requires that “[a]ny doubt concerning personnel being considered for national security eligibility 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. Likewise, I have avoided drawing inferences grounded on mere speculation or conjecture. Under Directive ¶ E3.1.14, the Government must present evidence to establish controverted facts alleged in the SOR. Directive ¶ E3.1.15 states that an “applicant is responsible for presenting witnesses and other evidence to rebut, explain, extenuate, or mitigate facts admitted by the applicant or proven by Department Counsel, and has the ultimate burden of persuasion as to obtaining a favorable clearance decision.” A person who applies for national security eligibility seeks to enter 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 national security eligibility. Decisions include, by necessity, consideration of the possible risk the applicant may deliberately or inadvertently fail to protect or safeguard sensitive information. Such decisions entail a certain degree of legally permissible extrapolation as to potential, rather than actual, risk of compromise of sensitive information. Finally, as emphasized in Section 7 of Executive Order 10865, “[a]ny determination under this order adverse to an applicant 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.” See also 5 Executive Order 12968, Section 3.1(b) (listing multiple prerequisites for access to classified or sensitive information.) Analysis Guideline F: Financial Considerations AG ¶ 18 sets out the trustworthiness concerns pertaining to financial considerations: 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. Affluence that cannot be explained by known sources of income is also a security concern insofar as it may result from criminal activity, including espionage. This concern is broader than the possibility that an individual might knowingly compromise sensitive information in order to raise money. It encompasses concerns about an individual’s self-control, judgment, and other qualities essential to protecting sensitive information. An individual who is financially irresponsible may also be irresponsible, unconcerned, or negligent in handling and safeguarding classified or sensitive information.4 AG ¶ 19 describes two conditions that could raise trustworthiness concerns and may be disqualifying in this case: (a) inability to satisfy debts; and (c) a history of not meeting financial obligations. Applicant has a history of being unable to satisfy delinquent debts that began accumulating in 2010 and remain unresolved. The evidence raised the above disqualifying conditions. AG ¶ 20 provides four conditions that could mitigate the trustworthiness concerns raised under this guideline: 4 See ISCR Case No. 11-05365 at 3 (App. Bd. May 1, 2012). 6 (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, a death, divorce or separation, clear victimization by predatory lending practices, or identity theft), and the individual acted responsibly under the circumstances; (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; and (d) the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts. The evidence does not establish mitigation under AG ¶ 20(a) because Applicant’s financial problems are ongoing. There is sufficient evidence to establish partial mitigation under AG ¶ 20(b) because Applicant’s family background and lack of financial resources were conditions that contributed to her delinquent debts and beyond her control. However, full mitigation under this condition is not established as she failed to submit sufficient evidence that she attempted to responsibly manage the debts as they were accumulating. The evidence establishes some mitigation under AG ¶ 20(c). Applicant has been working with a debt management company to resolve debts and there are early indications that her debts and finances are slowly being addressed. She presented evidence that between 2014 and 2017 she made some good-faith efforts to pay delinquent debts through that debt management company. The evidence establishes limited mitigation under AG ¶ 20(d). Guideline E: Personal Conduct AG ¶ 15 sets out the trustworthiness concerns pertaining to personal conduct: 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 or sensitive information. Of special interest is any failure to cooperate or provide truthful and candid answers during national security investigative or adjudicative processes. AG ¶ 16 describes a condition that could raise trustworthiness concerns and may be disqualifying in this case: (a) deliberate omission, concealment, or falsification of relevant facts from any personnel security questionnaire, personal history statement, or similar 7 form used to conduct investigations, determine employment qualifications, award benefits or status, determine national security eligibility or trustworthiness, or award fiduciary responsibilities. Applicant failed to disclose a 2002 arrest and delinquent debts in her 2016 e-QIP. She denied that she intentionally attempted to mislead the government about these issues. She testified that she was 17-years old at the time of the incident. She did not think she was required to disclose the 2002 incident because she was not arrested, but received a citation for disorderly conduct. Although she knew she had delinquent debts when she was completing the e-QIP, she did not disclose any because she did not know the specifics about them. When she met with an investigator, she promptly told him about her undisclosed debts. Based on her credible testimony, this guideline is found in her favor. Hence, a discussion of mitigating conditions is unnecessary. Whole-Person Concept Under the whole-person concept, the administrative judge must evaluate an applicant’s national security eligibility by considering the totality of the applicant’s conduct and all relevant circumstances. The administrative judge should also consider the following nine adjudicative process factors listed at AG ¶ 2(d): (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 for the conduct; (8) the potential for pressure, coercion, exploitation, or duress; and (9) the likelihood of continuation or recurrence. According to AG ¶ 2(c), the ultimate determination of whether to grant national security eligibility 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 relevant facts and circumstances surrounding this case. Applicant is a 32-year-old woman, who has successfully worked for an employer since 2014. She readily admitted that she has debts, which she has been unable to pay, the largest ones relating to medical bills she incurred after 2015 car accident for which she did not have insurance or qualify for public assistance. They represent $23,260 of the $27,855 amount alleged in the SOR. She applied for a forgiveness agreement with the medical creditor for those debts but has not received a response. At this time Applicant is making small payments on one SOR debt and one non-alleged debt through a debt management program. She previously resolved an educational loan through monthly payments into the program. Her student loans are current. She started a savings account and is contributing to a retirement fund. 8 After listening to her testimony and observing her demeanor, I believe Applicant understands the importance of financial responsibility and the affect that it will have on her employment. She is aware of her debts, but does not have the financial ability to promptly resolve all of them and remain current on expenses. She appears to be committed to working with a debt management company to manage her finances and resolve her obligations. She is slowly demonstrating that she is addressing them on a limited budget. A trustworthiness adjudication is not a debt collection procedure. It is a procedure designed to evaluate an applicant’s judgment, reliability, and trustworthiness. See ISCR Case No. 09-02160 (App. Bd. Jun. 21, 2010). An applicant is not required, as a matter of law, to establish resolution of every debt alleged in the SOR. An applicant need only establish a plan to resolve the financial problems and take significant actions to implement the plan. There is no requirement that an applicant make payments on all delinquent debts simultaneously, nor is there a requirement that the debts alleged in the SOR be paid first. See ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008). There is also no requirement that an applicant pay every debt listed in the SOR, only that she remove concerns about her reliability and trustworthiness raised by those debts. See ISCR Case No. 14-00504 at 3 (App. Bd. August 4, 2014). Based on the record, I find that Applicant’s unresolved debts no longer raise financial trustworthiness concerns. Overall, the record evidence leaves me without doubts as to Applicant’s present reliability and national security eligibility. Applicant mitigated the financial and personal conduct trustworthiness concerns. Formal Findings Formal findings for or against Applicant on the allegations set forth in the SOR, as required by ¶ E3.1.25 of Enclosure 3 of the Directive, are: Paragraph 1, Guideline F: FOR APPLICANT Subparagraphs 1.a through 1.h: For Applicant Paragraph 2, Guideline E: FOR APPLICANT Subparagraphs 2.a and 2.b: For Applicant Conclusion In light of all of the circumstances presented by the record in this case, it is clearly consistent with the national interest to continue Applicant’s eligibility for a position of trust. National security eligibility is granted. _________________ Shari Dam Administrative Judge