DATE: July 28, 2004

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SSN: -----------

Applicant for Security Clearance

DECISION OF ADMINISTRATIVE JUDGE

ROBERT ROBINSON GALES

APPEARANCES

FOR GOVERNMENT

Marc Curry, Esquire, Department Counsel

FOR APPLICANT

Pro Se

SYNOPSIS

Forty-four-year-old Applicant with a lengthy history (going back two decades) of ignoring his financial obligations--largely attributed to varied periods of unemployment, underemployment, and temporary employment--made no effort whatsoever to address those obligations, even after this security clearance review process commenced. He filed for bankruptcy under Chapter 13 on two separate occasions, only to have both such actions dismissed for his failure to follow through with payments. The absence of efforts to resolve his debts, too many unfulfilled promises to do so, and his lack of candor, raise grave questions and doubts as to his security eligibility and suitability. Clearance is denied.

STATEMENT OF THE CASE

On December 31, 2003, the Defense Office of Hearings and Appeals (DOHA), pursuant to Executive Order 10865, Safeguarding Classified Information Within Industry, dated February 20, 1960, as amended and modified, and Department of Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (Directive), dated January 2, 1992, as amended and modified, issued a Statement of Reasons (SOR) to Applicant. The SOR detailed reasons why DOHA could not make the preliminary affirmative finding under the Directive that it is clearly consistent with the national interest to grant or continue a security clearance for Applicant, and recommended referral to an administrative judge to determine whether a clearance should be granted, continued, denied, or revoked.

In a sworn written statement, dated February 2, 2004, Applicant responded to the allegations in the SOR and requested a hearing. The case was assigned to me on May 11, 2004. A notice of hearing was issued on May 12, 2004, and the hearing was held before me on May 28, 2004. During the hearing, four government exhibits, and one Applicant exhibit, and the testimony of one Applicant witness (the Applicant), were received. The transcript (Tr.) was received on June 8, 2004.

RULINGS ON PROCEDURE

During the proceeding, Department Counsel moved to amend two allegations to correct typographical errors and to conform to the expected evidence. Specifically, in subparagraph 1.c. the name of the creditor was corrected, and in subparagraph 2.a. the date was corrected from "January 22, 2002," to "January 18, 2002." There being no objection by Applicant, the motions were granted, and the changes were made.

Applicant has admitted all of the factual allegations pertaining to financial matters under Guideline F (subparagraphs 1.a. through 1.f.). Those admissions are incorporated herein as findings of fact. He denied the factual allegations pertaining to personal conduct under Guideline E (subparagraph 2.a.).

After a complete and thorough review of the evidence in the record, and upon due consideration of same, I make the following additional findings of fact:

Applicant is a 44-year-old employee of a defense contractor seeking to obtain a security clearance. He had previously been granted a TOP SECRET security clearance in March 1987, ⁽¹⁾ following a favorable decision issued by DOHA. ⁽²⁾

Applicant has a lengthy history reflecting outstanding financial obligations which were either charged off, turned over to collection, or became adverse judgments. Some bills were simply ignored and remained unpaid. During the early 1980s, while still residing in his mother's residence and not required to contribute rent or be responsible for household expenses or food on a regular basis, his debts were not yet a financial burden. ⁽³⁾ However, he became financially overextended in the mid-1980s when he established his own household and had to undertake responsibility for those household expenses for which he had not previously been responsible. ⁽⁴⁾ Faced with substantial adverse actions by creditors, Applicant eventually sought debt consolidation assistance through a Consumer Credit Counseling Service (CCCS). ⁽⁵⁾ At the time of his first DOHA hearing in August 1986, Applicant was purportedly abiding by the payment arrangements set up by CCCS. ⁽⁶⁾ While the judge in that case found Applicant had not made any serious effort to come to grips with his deteriorating financial situation until his security clearance was in jeopardy, it was decided that Applicant's irresponsibility had been mitigated because he "had made no attempt to evade or hide from his creditors and he did make an occasional payment when he had extra funds." ⁽⁷⁾ As a result, Applicant received his security clearance.

Applicant's employment history since the late 1980s has been marked by lengthy and brief periods of unemployment and underemployment as well as periods of temporary employment and permanent employment. The employment account which follows is a summarized version distilled from a variety of inconsistent information furnished by Applicant. He was employed as a communications technician during 1987-88 and 1988-89 by government contractors, and was released when their respective contracts had been completed. ⁽⁸⁾ He held a similar position with a federal agency from November 1990 until January 1992, ⁽⁹⁾ but was fired for being less than candid about his prior criminal conduct on his initial employment application. ⁽¹⁰⁾ Applicant was unemployed from January 1992 for one and one-half years until about June 1993. ⁽¹¹⁾ He worked for another company for nine months during 1993-94, ⁽¹²⁾ followed by another period of unemployment, and in November 1994 obtained another job which he held until August 1996. ⁽¹³⁾ In October 1996, Applicant obtained another job as a technician, and held that job until January 1998. ⁽¹⁴⁾ He held three different temporary positions from January 1998 until July 1998. ⁽¹⁵⁾ He again reverted to an unemployment status in July 1998, and remained in that status until October 1998. ⁽¹⁶⁾ Applicant was employed as an engineering technician by another company in two different locations from October 1998 until August 1999, ⁽¹⁷⁾ but again became unemployed from August to November 1999. ⁽¹⁸⁾ He held another job from November 1999 until April 2001, when he again reverted to unemployment, and remained in that status until October 2001. ⁽¹⁹⁾ Applicant has been employed by his current employer--a government contractor--since October 2001. ⁽²⁰⁾ His current gross weekly compensation is approximately $878.00, ⁽²¹⁾ of which he receives approximately $464.00 after deductions. ⁽²²⁾

In late 1996, during a period of unemployment, Applicant received food stamps from the county board of social services. At some point in 1997, the board learned that Applicant had wrongfully continued to collect food stamps after he had accepted temporary employment and was no longer eligible to do so. ⁽²³⁾ In September 1997, a civil judgment in the amount of $956.00--considered by the board to be the amount overpaid to Applicant--was entered against him in favor of the county board of social services. ⁽²⁴⁾ As of November 3, 2003, Applicant had not made any payments to, nor entered into any arrangements with, the creditor (more fully identified in subparagraph 1.d. of the SOR). ⁽²⁵⁾ Furthermore, Applicant has not paid off the judgment as of the date of the hearing. ⁽²⁶⁾

Applicant purchased a new residence for $73,679.00 ⁽²⁷⁾ in about June 1997. ⁽²⁸⁾As a result of being laid-off six months later, he was unable to make the required monthly mortgage payments or homeowners association dues. ⁽²⁹⁾ In November 2001, a civil judgment for past due homeowner dues, interest, and costs, in the amount of $3,023.00 was entered against him in favor of the homeowners association. ⁽³⁰⁾ As of November 3, 2003, Applicant had not made any payments to, nor entered into any arrangements with, the creditor. ⁽³¹⁾ Furthermore, Applicant has not paid off the judgment, nor entered into any payment arrangements, as of the date of the hearing. ⁽³²⁾ While he doesn't have sufficient funds to make any payments at this time, Applicant hopes to be able to commence making payments in September 2004. ⁽³³⁾

In May 2000, Applicant filed a petition for bankruptcy under Chapter 13. ⁽³⁴⁾ Under that proposed plan, Applicant was to have made payments to the homeowners association and his mortgage company, as well as to other creditors. ⁽³⁵⁾ While he claimed to have made some initial payments to the bankruptcy trustee, ⁽³⁶⁾ he has offered no documentation to support his contention. Moreover, he has denied making any payments through the bankruptcy plan. ⁽³⁷⁾ The bankruptcy was dismissed. ⁽³⁸⁾

In August 2001, Applicant again filed for bankruptcy under Chapter 13. ⁽³⁹⁾ At that time he listed total liabilities of $98,484.99 ⁽⁴⁰⁾ and total assets of $83,700.00, ⁽⁴¹⁾ of which his real property was worth $80,000.00. ⁽⁴²⁾ The bankruptcy was dismissed in February 2002 for failure to make all required pre-confirmation payments to the trustee or attend the confirmation hearing. ⁽⁴³⁾

In May 2002, a tax lien in the amount of $5,150.00 was filed on behalf of the state (more fully identified in subparagraph 1.b. of the SOR) against Applicant for back taxes from 2001. ⁽⁴⁴⁾ As of November 3, 2003, Applicant had not made any payments to, nor entered into any arrangements with, the creditor. ⁽⁴⁵⁾ Furthermore, Applicant has not paid off the lien, nor entered into any payment arrangements, as of the date of the hearing because he is "taking [his debts] one at a time." ⁽⁴⁶⁾

In September 2002, because of his inability to eliminate his mortgage payment arrearage in its entirety, Applicant lost his residence to foreclosure. ⁽⁴⁷⁾

In late 2003, Applicant purchased a previously owned 1999 Ford Expedition for $19,000.00 in cash. ⁽⁴⁸⁾ He had borrowed the money from his father. ⁽⁴⁹⁾

In April 2003, a tax lien in the amount of $6,198.00 was filed on behalf of the Internal Revenue Service (IRS) against Applicant for unpaid 1999 federal income taxes. ⁽⁵⁰⁾ Applicant's salary was subsequently garnished and $100.00 per weekly pay period is sent to the creditor. ⁽⁵¹⁾ As of May 14, 2004, during 2004 alone, Applicant had paid the creditor $2,000.00 towards resolving the indebtedness. ⁽⁵²⁾ The remaining balance has not been specified, and Applicant is unsure as to what it might be.

In January 2002, Applicant completed a Security Clearance Application (SF 86), ⁽⁵³⁾ and in response to a finance-related inquiry: ("In the last 7 years, have you had any judgments against you that have not been paid?"), ⁽⁵⁴⁾responded "no." ⁽⁵⁵⁾ He certified his response was true, complete, and accurate. It was obviously false. Applicant denied intending to falsify his response and explained he had simply forgotten about his two civil judgments. ⁽⁵⁶⁾

Applicant was never married, but has custody of, and resides with, his teenage son.

The quality of Applicant's work performance is not known.

Enclosure 2 of the Directive sets forth adjudicative guidelines which must be considered in the evaluation of security suitability. In addition to brief introductory explanations for each guideline, the adjudicative guidelines are divided into those that may be considered in deciding whether to deny or revoke an individual's eligibility for access to classified information (Disqualifying Conditions) and those that may be considered in deciding whether to grant an individual's eligibility for access to classified information (Mitigating Conditions).

An administrative judge need not view the adjudicative guidelines as inflexible ironclad rules of law. Instead, acknowledging the complexities of human behavior, these guidelines, when applied in conjunction with the factors set forth in the Adjudicative Process provision in Section E2.2., Enclosure 2, of the Directive, are intended to assist the administrative judge in reaching fair and impartial common sense decisions.

Because the entire process is a conscientious scrutiny of a number of variables known as the "whole person concept," all available, reliable information about the person, past and present, favorable and unfavorable, should be considered in making a meaningful decision. The Adjudicative Process factors which an administrative judge should consider are: (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 voluntariness of participation; (6) the presence or absence of rehabilitation and other pertinent 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.

Based upon a consideration of the evidence as a whole, I find the following adjudicative guidelines most pertinent to an evaluation of the facts of this case:

Financial Considerations - Guideline F: An individual who is financially overextended is at risk of having to engage in illegal acts to generate funds. Unexplained affluence is often linked to proceeds from financially profitable criminal acts.

Personal Conduct - Guideline E: Conduct involving questionable judgment, untrustworthiness, unreliability, lack of candor, dishonesty, or unwillingness to comply with rules and regulations could indicate that the person may not properly safeguard classified information.

Conditions that could raise a security concern and may be disqualifying, as well as those which could mitigate security concerns, pertaining to both adjudicative guidelines are set forth and discussed in the Conclusions section below.

Since the protection of the national security is the paramount consideration, the final decision in each case must be arrived at by applying the standard the issuance of the clearance is "clearly consistent with the interests of national security," ⁽⁵⁷⁾ or "clearly consistent with the national interest." For the purposes herein, despite the different language in each, I have concluded both standards are one and the same. 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.

In the decision-making process, the burden of producing evidence initially falls on the government to establish a case which demonstrates, in accordance with the Directive, it is not clearly consistent with the national interest to grant or continue an applicant's access to classified information. If the government meets its burden, the heavy burden of persuasion then falls upon the applicant to present evidence in refutation, explanation, extenuation or mitigation sufficient to overcome the doubts raised by the government's case, and to ultimately demonstrate it is clearly consistent with the national interest to grant or continue the applicant's clearance.

A person who seeks access to classified information enters into a fiduciary relationship with the Government predicated upon trust and confidence. It is a relationship that transcends normal duty hours and endures throughout off-duty hours as well. It is because of this special relationship the Government must be able to repose a high degree of trust and confidence in those individuals to whom it grants access to classified information. Decisions under this Directive include, by necessity, consideration of the possible risk an applicant may deliberately or inadvertently fail to protect or safeguard classified information. Such decisions entail a certain degree of legally permissible extrapolation as to potential, rather than actual, risk of compromise of classified information.

One additional comment is worthy of note. Applicant's allegiance, loyalty, and patriotism are not at issue in these proceedings. Section 7 of Executive Order 10865 specifically provides industrial security clearance 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." Security clearance decisions cover many characteristics of an applicant other than allegiance, loyalty, and patriotism. Nothing in this Decision should be construed to suggest I have based this decision, in whole or in part, on any express or implied decision as to Applicant's allegiance, loyalty, or patriotism.

Upon consideration of all the facts in evidence, an assessment of the witness credibility, and after application of all appropriate legal precepts, factors, and conditions, including those described briefly above, I conclude the following with respect to each allegation set forth in the SOR:

The government has established its case under Guideline F. Applicant's long-standing financial difficulties, since the mid 1980s, have been attributed to a variety of reasons, including: lengthy and brief periods of unemployment and underemployment as well as periods of temporary employment; having to undertake responsibility for household expenses for which he had not previously been responsible; the normal everyday expenses of raising a child as a single parent; and being confronted with the illness of a parent. Some of his unemployment was caused by reasons over which he had no control, such as the expiration of a contract or lack of work, and at least one period of unemployment was because he had failed to be candid on one of his employment applications.

In addition, his deteriorating financial position was further exacerbated by his apparent vacillation regarding bankruptcy, having filed for bankruptcy under Chapter 13 on two separate occasions, only to have both such actions dismissed for his failure to follow through with payments. Applicant incurred too many consumer debts and fell behind in his monthly payments. Eventually he stopped making payments altogether, and various creditors either charged off their losses, transferred or sold the accounts, repossessed a residence, obtained civil judgments, or referred the overdue accounts to collection.

Despite being aware of his debts, as well as DOHA's repeated official interest in them, Applicant took little if any action to resolve any of them, despite the impression he had conveyed during the earlier DOHA hearing. Instead, over the period of two decades, commencing in the mid-1980s, and continuing until this day, Applicant simply ignored his creditors and kept stringing along the authorities by relating his intentions for resolving them. His stories are reminiscent of the comment, "the check is in the mail."

Applicant's varying positions on several aspects of his debts-the nature of the debt, whether or not he was aware of the debt, whether or not he intended to pay the debt, or whether or not he intended to declare bankruptcy-furnish me with little if any confidence in his credibility or candor. Aside from those varying renditions, one factor stands clear. Applicant has not even made superficial efforts to resolve his outstanding financial obligations, and his varying statements seem to be nothing more than perpetual promises made and broken, followed by additional promises made and broken. Not even the renewed security clearance review process could motivate him to take some positive action with regard to his debts. It is additionally significant that Applicant borrowed $19,000.00 to pay cash for a automobile, but set nothing aside to make even a token payment towards any of his outstanding financial obligations. Thus, his conduct pertaining to his financial obligations falls within Financial Considerations Disqualifying Condition (FC DC) E2.A6.1.2.1. (history of not meeting financial obligations), and FC DC E2.A6.1.2.3. (inability or unwillingness to satisfy debts).

Applicant's periods of unemployment, underemployment, and temporary employment--some of the conditions attributed by him to be the causes of his financial problems--fall within Financial Considerations Mitigating Condition (FC MC) E2.A6.1.3.3. (the conditions that resulted in the behavior were largely beyond the person's control (e.g., loss of employment, a business turndown, unexpected medical emergency, or a death, divorce or separation)). However, the overall impact of those conditions is minimized because of when they occurred and the rather lengthy period since then when he should have recovered from them. Applicant was largely unmotivated by the security clearance review process to take meaningful corrective action, and preferred to ignore his outstanding debts as long as he could. Under these circumstances, I can find no evidence of positive action on his part to resolve his outstanding debts.

It is apparent that Applicant's current finances are presently still not in the best of shape, ostensibly unchanged from the way they had been earlier. His financial problems continue to exist. Moreover, his persistent problem is not, and has never been, solely the result of conditions beyond his control. Periods of unemployment, underemployment, and temporary employment have coincided with periods of permanent employment, and, but for Applicant's seeming intransigence regarding timely resolution of his debts, steps should have already been taken by him to enter into payment arrangements with the creditors. Instead, Applicant has ignored most of the debts, lost a home to foreclosure, commenced two aborted attempts at bankruptcy under Chapter 13, and been forced to relinquish $100.00 per week from his paycheck due to the garnishment action by the IRS. Applicant contends he intends to commence paying his first debt in September 2004. Other than that promise, and the involuntary garnishment, he has made no efforts to resolve his debts. Under these circumstances, I believe Applicant has failed to mitigate or overcome the government's case, for the evidence leaves me with grave questions and doubts as to Applicant's continued security eligibility and suitability with respect to his financial considerations. Accordingly, allegations 1.a. through 1.f. of the SOR are concluded against Applicant.

The government has established its case under Guideline E. Examination of Applicant's actions reveals conduct involving questionable judgment, untrustworthiness, unreliability, and unwillingness to comply with rules and regulations. There is little dispute surrounding Applicant's deceptive actions. Applicant continuously furnished differing stories regarding the specifics of his outstanding financial obligations and provided constantly changing misinformation pertaining to his intentions relative thereto. Likewise, when he completed his SF 86, he again lied, willfully falsified, omitted, concealed, and minimized his history of financial difficulties. Applicant is steadfast in his position he did not intend to falsify or omit the correct information. Instead, his explanation is that he simply forgot the two civil judgments. I cannot accept those deceptions. In this instance, I have no credible evidence of inadvertent or accidental oversight, but rather seemingly a calculated and deliberate omission of information which Applicant chose not to reveal.

Complete honesty and candor on the part of applicants for access to classified information is essential to make an accurate, meaningful security clearance determination. Without all the relevant and material facts, a clearance decision is susceptible to error, thus jeopardizing the nation's security. The nature of Applicant's actions therefore pose a serious potential risk to the nation's security precautions which go to the very heart of the nation's security system.

Applicant's overall questionable personal conduct in this regard clearly falls within Personal Conduct Disqualifying Condition (PC DC) E2.A5.1.2.2. (the deliberate omission, concealment, or falsification of relevant and material facts from any personnel security questionnaire, personal history statement, or similar form used to conduct investigations, determine employment qualifications, award benefits or status, determine security clearance eligibility or trustworthiness, or award fiduciary responsibilities). None of the Mitigating Conditions apply.

I do not take this position lightly, but based on the law, as set forth in Department of Navy v. Egan, 484 U.S. 518 (1988), my evaluation of the evidence, and my application of the pertinent conditions and factors under the Adjudicative Process, Applicant has failed to mitigate or overcome the government's case. The evidence leaves me with grave questions and doubts as to Applicant's continued security eligibility and suitability. Accordingly, allegation 2.a. of the SOR is concluded against Applicant.

For the reasons stated, I conclude Applicant is not eligible for access to classified information.

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. Guideline F: AGAINST THE APPLICANT

Subparagraph 1.a.: Against the Applicant

Subparagraph 1.b.: Against the Applicant

Subparagraph 1.c.: Against the Applicant

Subparagraph 1.d.: Against the Applicant

Subparagraph 1.e.: Against the Applicant

Subparagraph 1.f.: Against the Applicant

Paragraph 2. Guideline E: AGAINST THE APPLICANT

Subparagraph 2.a.: Against the Applicant

In light of all the circumstances presented by the record in this case, it is not clearly consistent with the national interest to grant or continue a security clearance for Applicant. Clearance is denied.

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