1 DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS In the matter of: ) ) -------------------------------------- ) ISCR Case No. 16-00887 ) Applicant for Security Clearance ) Appearances For Government: Benjamin R. Dorsey, Esq., Department Counsel For Applicant: Pro se ______________ Decision ______________ LEONARD, Michael H., Administrative Judge: Applicant contests the Defense Department’s intent to deny or revoke her eligibility for access to classified information. She failed to present sufficient evidence to explain, extenuate, or mitigate the security concern stemming from a history of financial problems or difficulties. Accordingly, this case is decided against Applicant. Statement of the Case Applicant completed and submitted a Questionnaire for National Security Positions (SF 86 format) on September 30, 2015. This document is commonly known as a security clearance application. Thereafter, on October 11, 2016, after reviewing the application and the information gathered during a background investigation, the Department of Defense Consolidated Adjudications Facility, Fort Meade, Maryland, sent Applicant a statement of reasons (SOR), explaining it was unable to find that it was clearly consistent with the national interest to grant her eligibility for access to classified information. The SOR is similar to a complaint. It detailed the factual reasons for the action under the security guideline known as Guideline F for financial considerations. 2 Applicant answered the SOR on November 7, 2016. She requested a decision based on the written record in lieu of a hearing. Her response consisted of a three-page memorandum and one enclosure. On December 13, 2016, Department Counsel submitted all relevant and material information that could be adduced at a hearing. The file of relevant material (FORM) consists of Department Counsel’s written brief and supporting documentation, some of which are identified as evidentiary exhibits in this decision. The FORM was mailed to Applicant on December 19, 2016, who received it December 27, 2016. She did not reply within 30 days from receipt of the information as required. The case was assigned to me October 1, 2017. Procedural Matters Department Counsel’s FORM includes Exhibit 4, which is a report of investigation (ROI) summarizing Applicant’s interview that took place during the December 2015 background investigation. The ROI is not authenticated by a witness, which is required under ¶ E3.1.20 of the Directive.1 Likewise, Section 5(a) of Executive Order 10865 prohibits receipt and consideration of “investigative reports” without authenticating witnesses. The Directive provides no exception to the authentication requirement. Indeed, the authentication requirement is the exception to the general rule that prohibits consideration of an ROI. Department Counsel’s written brief includes a footnote advising Applicant that the summary was not authenticated and that failure to object may constitute a “waiver” of the authentication requirement. In my view, Department Counsel is conflating or confusing the terms waiver and forfeiture. In the law of evidence, errors are preserved by timely objections, and relief on appeal is granted from a preserved error unless it is harmless (the harmless-error doctrine). Waiver is the voluntary relinquishment or abandonment of a legal right or advantage. When there is a legitimate waiver there is no error to correct on appeal and no relief to grant. On the other hand, failure to make a timely objection usually forfeits any error, and relief on appeal is appropriate from a forfeited error only upon a showing that the error was plain, obvious, and prejudicial (the plain-error doctrine). Here, the written record does not demonstrate that Applicant, who has not replied to the FORM, understood the concepts of authentication, waiver, and admissibility. It also does not demonstrate that she understood the implications of waiving an objection. Accordingly, given the lack of an authenticating witness, I have not considered the ROI in reaching my decision. 1 See generally ISCR Case No. 12-10933 (App. Bd. Jun. 29, 2016) (In a concurring opinion, Judge Ra’anan notes the historical concern about reports of investigation in that they were considered by some to present a heightened problem in providing due process in security clearance cases. Judge Ra’anan raises a number of pertinent questions about using an unauthenticated ROI in a non-hearing case with a pro se applicant.). 3 Findings of Fact Applicant is a 59-year-old employee who requires a security clearance for her employment as a federal contractor. She has worked as an executive administrative assistant since at least 2004. She had a full-time job from October 2004 to April 2008, when moved to another position. She had a full-time job from April 2008 to September 2012, when she was laid off due to non-renewal of a contract. She was then unemployed for about two months. She resumed full-time employment in November 2012, but was laid off in October 2013 due to non-renewal of a contract. She began her current full-time job in October 2013. She has never married and has no children. In her September 2015 security clearance application, Applicant disclosed four delinquent financial accounts. The SOR alleges a history of financial problems or difficulties consisting of 11 collection or charged-off accounts for a total of about $10,408. The accounts include two medical collection accounts for a total of $327, and the rest appear to be consumer accounts. All 11 delinquent accounts are established by credit reports from October 2015 and July 2016.2 There is no documentation in the written record to establish that the any of the 11 delinquent accounts were paid, settled, in a payment arrangement, cancelled, forgiven, or otherwise resolved. In her answer to the SOR, Applicant explained that her indebtedness was caused by the job loss and two-month period of unemployment in 2012 and subsequent underemployment. In particular, she stated that she went from earning about $70,000 annually to earning about $40,000, a loss of about $30,000 in annual income. She also stated that she is working with a financial counselor, and provided a one-page client action plan, dated October 24, 2016, as an enclosure to her answer. That document reflects a gross annual income of about $39,000. Law and Policies This case is adjudicated under Executive Order (E.O.) 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 National Security Adjudicative Guidelines for Determining Eligibility for Access to Classified Information or Eligibility to Hold a Sensitive Position (AG), effective June 8, 2017.3 It is well-established law that no one has a right to a security clearance.4 As noted by the Supreme Court in Department of the Navy v. Egan, “the clearly consistent standard indicates that security clearance determinations should err, if they must, on the 2 Exhibits 5, 6, and 7. 3 The 2017 AG are available at http://ogc.osd.mil/doha. 4 Department of the Navy v. Egan, 484 U.S. 518, 528 (1988) (“it should be obvious that no one has a ‘right’ to a security clearance”); Duane v. Department of Defense, 275 F.3d 988, 994 (10th Cir. 2002) (no right to a security clearance). 4 side of denials.”5 Under Egan, Executive Order 10865, and the Directive, any doubt about whether an applicant should be allowed access to classified information will be resolved in favor of protecting national security. A favorable clearance decision establishes eligibility of an applicant to be granted a security clearance for access to confidential, secret, or top-secret information.6 An unfavorable clearance decision (1) denies any application, (2) revokes any existing security clearance, and (3) prevents access to classified information at any level.7 There is no presumption in favor of granting, renewing, or continuing eligibility for access to classified information.8 The Government has the burden of presenting evidence to establish facts alleged in the SOR that have been controverted.9 An applicant is responsible for presenting evidence to refute, explain, extenuate, or mitigate facts that have been admitted or proven.10 In addition, an applicant has the ultimate burden of persuasion to obtain a favorable clearance decision.11 In Egan, the Supreme Court stated that the burden of proof is less than a preponderance of evidence.12 The Appeal Board has followed the Court’s reasoning, and a judge’s findings of fact are reviewed under the substantial-evidence standard.13 Discussion Under Guideline F for financial considerations, the suitability of an applicant may be questioned or put into doubt when that applicant has a history of excessive indebtedness or financial problems or difficulties. The overall concern is: 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 or sensitive information.14 5 484 U.S. at 531. 6 Directive, ¶ 3.2. 7 Directive, ¶ 3.2. 8 ISCR Case No. 02-18663 (App. Bd. Mar. 23, 2004). 9 Directive, Enclosure 3, ¶ E3.1.14. 10 Directive, Enclosure 3, ¶ E3.1.15. 11 Directive, Enclosure 3, ¶ E3.1.15. 12 Egan, 484 U.S. at 531. 13 ISCR Case No. 01-20700 (App. Bd. Dec. 19, 2002) (citations omitted). 14 AG ¶ 18. 5 The concern is broader than the possibility that a person might knowingly compromise classified or sensitive information to obtain money or something else of value. It encompasses concerns about a person’s self-control, judgment, and other important qualities. A person who is financially irresponsible may also be irresponsible, unconcerned, or negligent in handling and safeguarding classified information. In analyzing the facts of this case, I considered the following disqualifying and mitigating conditions as most pertinent: AG ¶ 19(a) inability to satisfy debts; AG ¶ 19(c) a history of not meeting financial obligations; 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; and AG ¶ 20(d) the individual initiated and is adhering to a good-faith effort to repay overdue creditors or otherwise resolve debts. The evidence supports a conclusion that Applicant has a problematic financial history sufficient to raise a security concern under Guideline F. She is indebted on 11 delinquent accounts for about $10,408, and none of delinquent debts are resolved. The failure to meaningfully address her delinquent accounts suggests she may be irresponsible, unconcerned, or negligent in handling and safeguarding classified information. What’s missing here is documentation in support of Applicant’s case. Although she met with a financial counselor in October 2016, shortly after the SOR was issued to her, there is no documentation from Applicant or her financial counselor to establish that there are clear indications that the problem is being resolved or is under control. Likewise, there is no documentation to establish that she has initiated and is adhering to a good-faith effort to repay her delinquent accounts. Finally, although her financial problems are connected to her unemployment and underemployment, I cannot conclude that she has acted responsibly under the circumstances given the state of the written record. Applicant’s history of financial problems or difficulties creates doubt about her reliability, trustworthiness, good judgment, and ability to protect classified information. In reaching this conclusion, I weighed the evidence as a whole and considered if the 6 favorable evidence outweighed the unfavorable evidence or vice versa. I also considered the whole-person concept. Accordingly, I conclude that she did not meet her ultimate burden of persuasion to show that it is clearly consistent with the national interest to grant her eligibility for access to classified information. Formal Findings The formal findings on the SOR allegations are: Paragraph 1, Guideline F: Against Applicant Subparagraphs 1.a – 1.k: Against Applicant Conclusion In light of the record as a whole, it is not clearly consistent with the national interest to grant Applicant access to classified information. Michael H. Leonard Administrative Judge