This guide outlines issues involved in U.S. government industrial security clearances and facility security clearances.
Federal Industrial Security Clearances
Individuals seeking employment with private government Contractors that contract to the Department of Defense, or DoD, often must secure an Industrial Security Clearance, known as an ISC. Sometimes the ISC is referred to as an Industrial Personnel Security Clearance, or PSC. Most applicants for a security clearance are approved after an investigation by the Defense Security Service, formerly known as the Defense Investigative Service. In some cases, the Office of Personnel Management, or OPM, conducts the investigation for an ISC. However, several thousand contractors annually are denied Industrial Security Clearances.
The United States Supreme Court in Greene v. McElroy held that applicants denied an Industrial Security Clearance as part of the Industrial Security Program must be provided with the opportunity for a Hearing to appeal the denial. DoD Directive 5220.6 and President's Executive Order 10865 governs the appeals process for a denial of an Industrial Security Clearance. President's Executive Order 12829 requires that federal agencies granting Security Clearances do so through the National Industrial Security Program, or NISP, which is maintained by the Department of Defense. Thus, all Industrial Security Clearance investigations, denials and appeals are processed through the Department of Defense program.
Once the Defense Security Service has completed its Personnel Security Investigation, or PSI, the findings were previously forwarded to the DOD Defense Industrial Security Clearance Office, known as DISCO. Now, the Consolidated Adjudication Facility, or CAF, issues the final determination on whether an Industrial Security Clearance will be issued or denied. If CAF denies the applicant an Industrial Security Clearance, the applicant may file an Appeal of the denial of the Industrial Security Clearance. The Statement of Reasons, or SOR, is the document that states the reasons for denial of the ISC. The Department of Defense's Department of Hearing Appeals, known as DOHA, administers the appeals process for denials of Industrial Security Clearances. The Department Counsel represents the Department of Defense. The applicant has 20 days to file a response to the Statement of Reasons that denies an Industrial Security Clearance. Failure to file an Answer to the SOR will result in a default against the applicant. Applicants can submit a written Appeal only, supported by documents and exhibits, or request a Hearing before a DOHA Administrative Law Judge.
A written Appeal of an Industrial Security Clearance denial is called a File or Relevant Material, or FORM case. The Department Counsel will provide the Administrative Law Judge and the applicant with the documents on which the DoD relied, to issue the denial of an Industrial Security Clearance. The applicant then has 30 days to respond to the FORM. The written Appeal can also include exhibits such as character letters and documents to support why the applicant should be granted an Industrial Security Clearance. However, statistics show that most applicants who file a written FORM Appeal do not receive an Industrial Security Clearance. Industrial Security Clearance denial applicants have a better chance of winning their Industrial Security Clearance denial Appeal if they attend a DOHA Hearing before an Administrative Law Judge.
Federal Facility Security Clearances
Pursuant to the National Industrial Security Program Operating Manual, or NISPOM, companies with a Facility Security Clearance, or FCL, must adhere to certain guidelines. All Key Management Personnel, or KMP, for an FCL must have an Industrial Security Clearance. Furthermore, each FCL must have a Facility Security Officer, or FSO. The Facility Security Officer must also obtain an Industrial Security Clearance.
Key Management Personnel is defined as company management, officers and senior leaders who exercise influence over decisions involving classified activity and classified contracts. Key Management Personnel must meet the same criteria required for regular applicants in obtaining an Industrial Security Clearance. Company managers, officers and leaders who are denied an Industrial Security Clearance cannot have any direct or indirect control or influence over classified activity and classified contracts. In some cases, Key Management Personnel Security Clearance denial may result in a denial of a Facility Security Clearance.
A Facility Security Officer, or FSO, is the point of contact between the company holding an FCL and the Department of Defense National Industrial Security Program, or NISP. The Facility Security Officer coordinates the Industrial Security Clearance applications for its employees and potential employees. The FSO is also responsible for implementing a Facility Security Program pursuant to DoD Directive 5220.22-M and the NISPOM. The failure of a Facility Security Officer to adhere to the duties of an FSO can result in the revocation of the Facility Security OFficer's Industrial Security Clearance and the revocation of the company's Facility Security Clearance, or FCL.
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