By John V. Berry, Esq., www.berrylegal.com
A good example of one of the major issues faced by federal employees and federal contractors with respect to security clearance cases involves issues arising under Guideline F, Financial Considerations. Guideline F is the portion of the Adjudicative Guidelines which involve financial considerations and their impact on an individual’s ability to maintain a security clearance.
Guideline F issues usually come into play when a federal employee or contractor has build up significant debts or is overextended in their ability to make monthly debts. The obvious concern with these types of cases is that an individual may be more vulnerable to foreign or other influence if they are in financial debt or cannot meet their bills.
This type of case is best illustrated by a recent ruling of the Defense Office of Hearings and Appeals (DOHA), in ISCR Case No. 10-040008 (DOHA Jan. 31, 2011) issued in late January, 2011. In this case, DOHA Administrative Judge Carol Ricciardello reviewed a security clearance denial that involved a federal contractor who had run into difficulties under Guideline F, Financial Considerations.
In particular, the case (ISCR Case No. 10-040008) at issue involved a federal contractor that had gotten into security clearance difficulties when a close family friend had sought the contractor’s help in co-signing for a mortgage in order to help them qualify for the home purchase. The contractor ultimately agreed to help out the family friend, on a temporary basis, in order to help them secure the mortgage.
Unfortunately, the family friend experienced financial difficulties after a number of months and was unable to make payments on the home, causing the federal contractor to become liable for making these payments. Eventually, the contractor had to assume full responsibility for the close family friend’s financial obligations. This, ultimately, led to having to sell the home through a short sale, and ultimately a dispute between the contractor and the mortgage company about the amount that she owed.
The federal contractor eventually received a Statement of Reasons (SOR), relating to the disputed debt owed to the mortgage company as she attempted to negotiate a settlement with the creditor. The case eventually was assigned to the DOHA and an administrative judge was assigned to hear it. The federal contractor had sought the restoration of her clearance.
LEGAL REASONING BY JUDGE IN GRANTING CLEARANCE
The Administrative Judge, in granting the federal contractor’s security clearance, made several key observations about her actions in the case, which are important to note by others facing issues under Guideline F, Financial Considerations. The positive factors in the case that mitigated the concerns regarding the federal contractor’s security clearance included:
* That the contractor had a record of paying her bills on time;
* That the contractor had a record of keeping a savings account;
* That the contractor had kept up the funding her retirement accounts;
* That despite the fact that she was attempting to help a family friend, and that the mortgage was not for her own home, that she assumed the debt and took full responsibility for the matter;
* That the contractor was financially solvent and lived within her means;
* That the contractor had a provided evidence to show her good character and honesty;
* That despite the difficult situation that the contractor faced, that the contractor attempted to confront the issues head on and acted with responsibility.
LESSONS TO TAKE FROM CASE
In security clearance cases involving Guideline F, Financial Considerations, it is very important to understand just how critical it is to demonstrate that the federal employee or contractor involved has been responsible regarding their finances or has made specific changes in their conduct to eliminate any future security concerns. In this case, the contractor was able to demonstrate this in the hearing process before the Administrative Judge and thereby obtain her security clearance.
These cases can involve many differing types of variables and a number of mitigating factors specific to each case so hiring counsel to represent and advise the person involved is critical because each case is different.