* The original of this document contains information which is subject to withholding from disclosure under 5 U.S.C. 552. Such material has been deleted from this copy and replaced with XXXXXXX’s.
May 29, 2002
DEPARTMENT OF ENERGY
OFFICE OF HEARINGS AND APPEALSHearing Officer's Decision
Name of Case: Personnel Security Hearing
Date of Filing: January 14, 2002
Case Number: VSO-0520
This Decision addresses the eligibility of XXXXX (the Individual) for access authorization. The regulations governing the Individual’s eligibility are found at 10 C.F.R. Part 710. As explained below, I find that the Individual should be granted access authorization.
The Individual applied for employment at a Department of Energy (DOE) facility. During an investigation of the Individual's background, the DOE obtained reliable information that cast doubt on his eligibility for access authorization. The information indicated that the Individual had demonstrated a pattern of financial irresponsibility. See 10 C.F.R. § 710.8(l).(1)
BACKGROUND
In 2001, as part of the access authorization application process, the Individual completed a Questionnaire for National Security Position (QNSP). Question 28(a) of the QNSP asked "in the last 7 years, have you been over 180 days delinquent on any debt(s)?" The Individual answered "yes" to this question, and specified that he had $23,000 in credit card debt that was over 180 days delinquent.(2)
The DOE then obtained the Individual's credit report. The report showed the following account data:(3)
Date
OpenedDate Last
ActiveStatus
Account "A"
08/90
11/96
Charged off, $9,071
Account "B"
08/94
09/96
Charged off, $3,029
Account "C"
02/90
09/96
Charged off, $12,700
Account "D"
01/93
03/96
Charged off, $3,578
Account "E"
11/88
01/94
Paid satisfactorily
Account "F"
09/85
04/93
Paid as agreed
Account "G"
02/91
05/91
In good standing
Later in 2001, the Individual was a given a Personnel Security Interview (PSI) to discuss the record of delinquent accounts. He admitted that the credit report was accurate and that he still owed the past due amounts listed on the report.(4) He attributed the delinquencies to a decline in family income following a divorce, and to living beyond his means.(5) He also acknowledged that he had made no effort during the previous five years to pay any of the delinquent accounts.(6) He admitted that he had been financially irresponsible in not paying his debts.(7)
In September 2001, the DOE issued a Notification Letter denying the Individual's application for access authorization. The Notification Letter cited the Individual's history of uncollected debt as the basis for the denial.(8) The Individual then requested a hearing to provide evidence in support of his eligibility for access authorization.(9)
HEARING TESTIMONY
At the hearing, the Individual presented the testimony of his wife and testified in his own behalf. He also submitted his income tax records for the previous eleven years, and documentation concerning a bankruptcy filing he made in late 2001. The DOE did not present any witness.
The Individual testified that in 1991, he was married to his first wife and the couple's joint income was $78,000.(10) In 1992, the Individual and his first wife were divorced. Also in 1992, his employer contracted out the section in which the Individual had worked, leaving the Individual unemployed.(11) Over the next two years, the Individual worked part time or drew unemployment compensation, earning a gross income of $8,700 in 1993 and $10,000 in 1994.(12)
In 1995, the Individual was employed by a firm that supplied support personnel to American embassies. The Individual was granted a top secret clearance and assigned to work in a foreign country.(13)
The Individual testified that, while working in the foreign country, he did not earn enough to support himself and had financial difficulties.(14) The Individual states that he became delinquent on his credit accounts during that period.(15) He stated that rather than using public transportation and the relatively inexpensive embassy dining facility, he purchased and repaired an automobile, and spent between $35 and $40 per day for food at stores for foreigners.(16) In addition, he testified that he did not resign because he did not want to pay for his transportation back to the United States, as was required of an employee resigning before his contractual term was up.(17)
While working at the embassy, the Individual married his second wife. At the end of the Individual's two-year employment contract, he returned to the United States, where he was unemployed for six months.(18) He testified that he found it difficult to get a job due to economic conditions.(19) He and his wife obtained a series of jobs, earning a joint income of $30,000 in 1999 and $33,000 in 2000.(20) He stated that he has not earned enough since returning to the United States to make payments on the delinquent accounts.(21)
In December 2001, the Individual filed for bankruptcy.(22) The bankruptcy petition listed all of the debts noted on his credit bureau report, which had been inactive since 1996, and no other accounts.(23) The attorney who represented the Individual at the hearing also represented him in the bankruptcy proceeding. The attorney stated during the hearing that the bankruptcy proceeding has been completed and the debts discharged.(24)
ANALYSIS
A DOE administrative review proceeding under Part 710 is not a criminal case, in which the burden is on the government to prove the defendant guilty beyond a reasonable doubt. Personnel Security Hearing, Case No. VSO-0078, 25 DOE ¶ 82,802 (1996). In a Part 710 case, the standard is designed to protect national security interests. Once the DOE has made a showing of derogatory information, the burden is on the individual to convince the DOE that restoring his access authorization "would not endanger the common defense and security and would be clearly consistent with the national interest." 10 C.F.R. § 710.27(d). This standard implies that there is a strong presumption against the granting or restoring of a security clearance. Department of Navy v. Egan, 484 U.S. 518, 531 (1988) ("clearly consistent with the interests of national security" standard for the granting of security clearances indicates that determinations should err, if they must, on the side of denials); Dorfmont v. Brown, 913 F.2d 1399, 1403 (9th Cir. 1990), cert. denied, 499 U.S. 905 (1991) (strong presumption against the issuance of a security clearance).
I find that the Individual's failure to keep current on his credit accounts to the extent discussed above, culminating in his bankruptcy, unquestionably demonstrates a pattern of financial irresponsibility. He has not disputed the existence of the delinquencies cited in the Notification Letter. Moreover, the Individual has acknowledged that he was financially irresponsible.(25)
Nevertheless, I find that the Individual has presented mitigating evidence. Most significantly, he has shown that his acts of financial irresponsibility were not recent. He testified that he has not incurred any debts in the last five years, and he corroborated this testimony by submitting a credit bureau report dated three days after the hearing.(26) The report showed no activity on any credit accounts for over five years. I therefore find that the Individual has demonstrated that his financial irresponsibility is not recent, and that he has learned to live within his means and not incur excessive debt.
In addition, I find that the Individual has demonstrated that his financial irresponsibility was an isolated occurrence. The Individual has been a working adult for over three decades. During that time, he has incurred delinquent debts only during the two year period that he lived in a foreign country. I am convinced that the Individual has not been financially irresponsible in any other period.
Finally, I believe that the Individual has testified with straightforwardness and candor about his financial problems. The Individual’s openness and honesty about his financial situation substantially mitigates the security concern. See Personnel Security Hearing, (Case No. VSO-0380) 28 DOE ¶ 82,770 (2000).
Once an individual has demonstrated a pattern of financial irresponsibility, he must demonstrate a new, sustained pattern of financial responsibility for a period of time that is sufficient to demonstrate that a recurrence of the past pattern is unlikely. Personnel Security Hearing (Case No. VSO-0108), 26 DOE ¶ 82,764 at 85,699 (1996). I find that the Individual in this case has demonstrated a pattern of financial responsibility for the past five years, and has thus established rehabilitation from his previous financial irresponsibility. Consequently, I find that the Individual has resolved the security concern raised by financial irresponsibility, and that he should be granted access authorization.
In regard to the Individual's declaration of bankruptcy, I note that bankruptcy is a legal means for resolution of financial problems. In considering eligibility for access authorization, the focus is on how that individual reached the point at which it became necessary for him to seek the help of the bankruptcy court in order to regain control of his financial situation through discharging his debts. Personnel Security Hearing, (Case No. VSO- 0288), 27 DOE ¶ 82,826 (1999). Because I have found, as discussed above, that the Individual's financial irresponsibility was confined to a limited period, and that he has established rehabilitation by living within his means for over five years, I believe that the chance of recurrence of financial irresponsibility is low. I therefore find that he has resolved security concerns raised by the bankruptcy filing.
CONCLUSION
I conclude that the Individual has resolved the security concerns identified by the DOE under 10 C.F.R. § 710.8(l). In view of the record before me, I am persuaded that granting the individual access authorization "will not endanger the common defense and security and will be clearly consistent with the national interest." Accordingly, I find that the Individual should be granted access authorization.
Warren M. Gray
Hearing Officer
Office of Hearings and AppealsDate: May 29, 2002
(1) 10 C.F.R. § 710.8(l) defines as derogatory information any information that indicates an individual has "engaged in any unusual conduct or is subject to any circumstances which tend to show that the individual is not honest, reliable, or trustworthy; or which furnishes reason to believe that the individual may be subject to pressure, coercion, exploitation, or duress which may cause the individual to act contrary to the best interests of the national security. Such conduct or circumstances include ... a pattern of financial irresponsibility."
(2) Hearing Exhibit (Exh.) 6, QNSP.
(3) Exh. 7, Credit Bureau report. Some accounts appear more than once, as the original retail account and as a collection agency account.
(4) Exh. 9, Transcript of PSI, at 5-6.
(5) Exh. 9, Transcript of PSI, at 7.
(6) Exh. 9, Transcript of PSI, at 8.
(7) Exh. 9, Transcript of PSI, at 9.
(8) Exh. 2, Notification Letter.
(9) Exh. 3, Individual's Request for Hearing.
(10) Transcript of Hearing (Tr.) at 7-8; Individual's Exhibit, 1991 Federal Income Tax Return.
(11) Tr., at 38.
(12) Tr., at 41; Individual's Exhibits, 1993 and 1994 Federal Income Tax Returns.
(13) Tr., at 10.
(14) Tr., at 16, 43. The Individual's Federal Income Tax returns show that he earned $19,000 in 1995 and $27,000 in 1996.
(15) Tr., at 43.
(16) Tr., at 10-14, 31.
(17) Tr., at 42-43.
(18) Tr., at 18.
(19) Tr., at 45.
(20) Individual's Exhibit, 1999 Federal Income Tax Return and 2000 State Tax Return.
(21) Tr., at 34.
(22) Ibid.
(23) Individual's Exhibit, Petition for Bankruptcy.
(24) Tr., at 47.
(25) Exh. 9, Transcript of PSI, at 9.
(26) The record contains no credit bureau reports for the Individual's wife.