1 DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS In the matter of: ) ) --------------------------- ) ISCR Case No. 16-01927 ) Applicant for Security Clearance ) Appearances For Government: Carroll J. Connelly, Esq., Department Counsel For Applicant: Pro se ______________ Decision ______________ KATAUSKAS, Philip J., Administrative Judge: Applicant contests the Defense Department’s intent to deny her eligibility for access to classified information. Applicant failed to mitigate the security concern raised by her problematic financial history. 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 December 20, 2015. This document is commonly known as a security clearance application. On September 19, 2016, after reviewing the application and the information gathered during a background investigation, the Department of Defense Consolidated Adjudications Facility 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.1 It detailed the factual reasons for 1 This action was taken under Executive Order (E.O.) 10865, Safeguarding Classified Information within Industry (February 20, 1960), as amended, as well as Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (January 2, 1992), as amended (Directive). In addition, the Adjudicative Guidelines for Determining Eligibility for Access to Classified Information (AG), 2 the action under the security guideline known as Guideline F for financial considerations. Applicant answered the SOR, but the Answer is undated. She requested a decision based on the written record without a hearing. On February 10, 2017, Department Counsel submitted a file of relevant material (FORM).2 The FORM was mailed to Applicant on February 13, 2017, and she received it on February 27, 2017. She was given 30 days to file objections and submit material to refute, extenuate, or mitigate the Government’s evidence.3 Applicant did not respond to the FORM. The case was assigned to me on October 1, 2017. Procedural Matters Included in the FORM were four items of evidence, which are marked as Government Exhibits (GE) 1 through 3.4 Exhibits 1 and 3 are admitted into evidence without objection. GE 2 is a report of investigation (ROI) summarizing Applicant’s interview that took place during the February 2016 background investigation. The ROI is not authenticated, as required under ¶ E3.1.20 of the Directive.5 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. Nevertheless, I am not persuaded that a pro se applicant’s failure to respond to the FORM, which response is optional, equates to a knowing and voluntary waiver of the authentication requirement. The record does not demonstrate that Applicant understood the concepts of authentication, waiver, and admissibility. It also does not demonstrate that he understood the implications of waiving an objection to the admissibility of the ROI. Accordingly, Exhibit 2 is inadmissible, and I have not considered the information in the ROI. effective within the Defense Department on June 8, 2017, apply here. The AG were published in the Federal Register and codified in 32 C.F.R. § 154, Appendix H (2016). In this case, the SOR was issued under Adjudicative Guidelines effective within the Defense Department on September 1, 2006. My decision and formal findings under the revised Guideline F would not be different under the 2006 Guideline F. 2 The file of relevant material consists of Department Counsel’s written brief and supporting documentation, some of which are identified as evidentiary exhibits in this decision. 3 The Defense Office of Hearings and Appeals’ (DOHA) transmittal letter is dated February 13, 2017, and Applicant’s receipt is dated February 27, 2017. The DOHA transmittal letter informed Applicant that she had 30 days after receiving it to submit information. 4 The first item in the FORM is the SOR and Applicant’s Answer. Because the SOR and the Answer are the pleadings in this case, they are not marked as Exhibits. Items 2 through 4 are marked as Exhibits 1 through 3. 5 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 46 years old and married with an adult son and a minor daughter. Since November 2015 she has worked for a defense contractor. Applicant had two periods of unemployment, one from June 2015 to August 2015 (caused when she relocated to another state), and one from June 2006 to October 2013 (when she was a “stay at home mom”).6 The SOR alleged 18 delinquent debts totaling approximately $40,099.7 Applicant admitted all allegations, except for SOR ¶¶ 1.j, 1.n, 1.o, and 1.p. Those debts that Applicant denies, however, are supported by the record.8 In sum, I find that all allegations of delinquent debts are supported by Applicant’s admissions or by record evidence. Law and Policies It is well-established law that no one has a right to a security clearance.9 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 side of denials.”10 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.11 An unfavorable clearance decision (1) denies any application, (2) revokes any existing security clearance, and (3) prevents access to classified information at any level.12 There is no presumption in favor of granting, renewing, or continuing eligibility for access to classified information.13 The Government has the burden of presenting evidence to establish facts alleged in the SOR that have been controverted.14 An 6 GE 1. 7 SOR ¶¶ 1.a-1.s. 8 GE 3, pp. 8, 16. Applicant has not submitted any evidence to support her denials. 9 Department of 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). 10 484 U.S. at 531 11 Directive, ¶ 3.2. 12 Directive, ¶ 3.2. 13 ISCR Case No. 02-18663 (App. Bd. Mar. 23, 2004). 14 Directive, Enclosure 3, ¶ E3.1.14. 4 applicant is responsible for presenting evidence to refute, explain, extenuate, or mitigate facts that have been admitted or proven.15 In addition, an applicant has the ultimate burden of persuasion to obtain a favorable clearance decision.16 In Egan, the Supreme Court stated that the burden of proof is less than a preponderance of evidence.17 The Appeal Board has followed the Court’s reasoning, and a judge’s findings of fact are reviewed under the substantial-evidence standard.18 Discussion Under Guideline F for financial considerations,19 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 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.20 The concern is broader than the possibility that a person might knowingly compromise classified 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: AG ¶ 19(a) inability to satisfy debts; AG ¶ 19(b) unwillingness to satisfy debts regardless of the ability to do so; AG ¶ 19(c) a history of not meeting financial obligations; 15 Directive, Enclosure 3, ¶ E3.1.15. 16 Directive, Enclosure 3, ¶ E3.1.15. 17 Egan, 484 U.S. at 531. 18 ISCR Case No. 01-20700 (App. Bd. Dec. 19, 2002) (citations omitted). 19 AG ¶¶ 18, 19, and 20 (setting forth the concern and the disqualifying and mitigating conditions). 20 AG ¶ 18. 5 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; 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 ¶(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 the conclusion that Applicant has a problematic financial history. AG ¶¶ 19(a), (b), and (c) apply. The next inquiry is whether any of the mitigating conditions apply. Since Applicant’s answer to the SOR was bare-bones, she has shed no light on the causes of her delinquent indebtedness. Nor did her Answer inform us about how she was addressing that indebtedness, if at all. Likewise, because Applicant did not respond to the FORM, the record is barren of any explanations for how she incurred the delinquent indebtedness and what efforts, if any, she has undertaken to address that indebtedness. Applicant’s period of delinquent indebtedness continues to the present, and there are 18 delinquencies. The period of indebtedness was not so long ago, nor was it infrequent. Thus, AG ¶ 20(a) does not apply. I did consider the two periods of unemployment Applicant experienced, two to three months in 2015 and just over seven years, from 2006 to 2013. Applicant attributed the 2015 unemployment to having relocated to another state. Without more, I cannot conclude that this was a circumstance largely beyond her control. Similarly, the lengthy, seven-year period of unemployment she attributed to electing to be a stay-at-home-mom, hardly a circumstance largely beyond her control. Thus, AG ¶ 20(b) does not apply. There is nothing in the record to show that Applicant has received financial counseling or that she has made good-faith efforts to repay her overdue creditors or otherwise resolve her debts. Thus, AG ¶¶ 20(c) and (d) do not apply. 6 The record raises doubts about Applicant’s 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 favorable evidence outweighed the unfavorable evidence or vice versa. I also gave due consideration to the whole-person concept.21 Accordingly, I conclude that Applicant failed to 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 As required by section E3.1.25 of Enclosure 3 of the Directive, I make the following formal findings on the SOR allegations: Paragraph 1, Guideline F: Against Applicant Subparagraphs 1.a-1.s: 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. Philip J. Katauskas Administrative Judge 21 AG ¶¶ 2(d)(1)-(9) and 2(f)(1)-(6).