KEYWORD: Financial 
DIGEST: Applicant is a highly regarded claims associate for a defense contractor who accumulated
a number of delinquent debts during periods her husband was out of work and unable to contribute
to the payment of their family debts. With little financial help from her husband and barely enough
income to support her family, she has been unable to make any meaningful inroads in paying her old
acknowledged debts, many of which are apparently barred by applicable statutes of limitation. While
she submitted a debt consolidation proposal after the hearing, she failed to certify to counseling or
approve the proposal in writing.   Although she is regarded as reliable and trustworthy by her friends
and colleagues, her manifest reluctance to address her finances unconditionally precludes her from
mitigating trustworthiness concerns at this time.  Eligibility for an ADP I/II/III position is denied.
CASENO: 06-08625.h1
DATE: 03/30/2007
DATE: March 30, 2007
In re:
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SSN: -----------
Applicant for Trustworthiness Determination
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ADP Case No. 06-08625
DECISION OF ADMINISTRATIVE JUDGE
ROGER C. WESLEY
APPEARANCES
FOR GOVERNMENT
Ray T. Blank, Jr., Department Counsel
FOR APPLICANT
Pro Se
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SYNOPSIS
Applicant is a highly regarded claims associate for a defense contractor who accumulated a
number of delinquent debts during periods her husband was out of work and unable to contribute to
the payment of their family debts. With little financial help from her husband and barely enough
income to support her family, she has been unable to make any meaningful inroads in paying her old
acknowledged debts, many of which are apparently barred by applicable statutes of limitation. While
she submitted a debt consolidation proposal after the hearing, she failed to certify to counseling or
approve the proposal in writing.   Although she is regarded as reliable and trustworthy by her friends
and colleagues, her manifest reluctance to address her finances unconditionally precludes her from
mitigating trustworthiness concerns at this time.  Eligibility for an ADP I/II/III position is denied.
STATEMENT OF THE CASE
On August 17, 2006, the Defense Office of Hearings and Appeals (DOHA), pursuant to
Department of Defense Directive 5220.6 (Directive), dated January 2, 1992, and Department of
Defense (DoD) Regulation 5200.2-R, issued a Statement of Reasons (SOR) to Applicant, which
detailed reasons why DOHA could not make the preliminary affirmative determination of
Applicant’s eligibility for occupying an ADP I/II/III position, and recommended referral to an
administrative judge to determine whether a trustworthiness determination clearance should be
granted, continued, denied or revoked.
Applicant responded to the SOR on October 11, 2006, and requested a hearing.  The case was
assigned to me on November 22, 2006, and was scheduled for hearing on December 6, 2006.  A
hearing was convened on December 6, 2006, for the purpose of considering whether it would be
clearly consistent with the national interest to grant, continue, deny, or revoke Applicant’s
application for a trustworthiness determination.  At hearing, the Government's case consisted of four
exhibits.  Applicant relied on two witnesses (including herself) and one exhibit.  The transcript
(R.T.) was received on December 21, 2006.
PROCEDURAL ISSUES
At hearing, Department Counsel moved to amend the Statement of Reasons (SOR).  This
proposed amendment entailed changing the reference from Department of Defense (DoD) Regulation
5200.2-R, Personnel Security Program (Regulation), dated January 1987, as amended to DoD
Directive 5220.6, Defense Industrial Personnel Security Clearance Review Program (Directive),
dated January 2, 1992, as amended and modified.  In support of its proposed amendment,
Department Counsel relied on a memorandum from the Deputy Under Secretary of Defense
(Counterintelligence and Security) to Director, Defense Office of Hearings and Appeals (DOHA),
dated November 19, 2004 that directs DOHA to utilize provisions of the Directive to resolve
contractor cases involving trustworthiness determinations.  The motion was granted.  As construed,
the procedural rules of the Directive will apply; while the substantive guidelines of the Regulation
 ADP III positions are not characterized as sensitive ones in DoD 5200.2-R (Appendix 10).  To make ADP III1
positions subject to trustworthiness determinations, the Deputy Under Secretary of Defense approved  use of the procedures in
DoD Directive 5220.6 to resolve referred ADP III contractor cases for trustworthiness determinations. To apply the Directive’s
substantive guidelines to ADP III cases would require at least some covered nexus in the Directive itself, which neither Executive
Order 10865 nor the procedural guidance in the Directive addresses.   While not a perfect blend of procedural/substantive
guidance, the combining of the Directive’s procedures with the substantive guidelines in DoD 5200.2-R provides the best
available framework under the circumstances for ensuring due process to ADPIII applicants seeking trustworthiness
determinations.
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will continue to control.   Although, in financial cases, there are no material differences in the1
treatment of financial considerations between the guidelines in the Directive and those in the
Regulation. 
Before the close of the hearing, Applicant asked for leave to keep the record open to afford
her the opportunity to supplement the record with accreditation documentation of her online medical
transcription school.  There being no objection from the Government, and good cause being shown,
Applicant was granted 14 days to supplement the record.  The Government was, in turn, afforded
seven days to respond.  Applicant timely requested an additional 14 days to document her
accreditation certification, as well as credit counseling assistance.  This request for additional time
was not objected to and was granted for good cause demonstrated.  Applicant timely provided
additional documentation covering her account of her ongoing efforts to repair her finances, her
accreditation certification, and her credit counseling arrangements, to which the Government did not
object.  Applicant’s post-hearing submissions are accepted as Applicant’s exhibits H through K. 
Because the submitted credit counsel proposal was not executed by Applicant, on February
5, 2007, I afforded her an additional ten days to provide an executed version and documented up-
front fees and payments she made to the credit counseling firm.  Department Counsel, in turn, was
granted seven days to respond to any submission.  Applicant did not supplement the record.
Informed by Department Counsel that Applicant never received my February 5, 2007 at her
new address, I wrote to Applicant on February 27, 2007 at her new address with the same extended
opportunity to provide an executed version of her credit counseling proposal and documented front
fees and payments, and afforded her an additional ten days to provide the information.
By e-mail dated March 12, 2007, Applicant confirmed her receipt of my February 27, 2007
letter and acknowledged she had not executed the credit counsel proposal or made any up-front
payments to the counseling firm.  Applicant indicated she is still endeavoring to obtain account
information on her creditors, and that her counseling contact can’t do anything on the consolidation
proposal until he obtains all of the original account numbers.  Applicant confirmed, too, that she has
not initiated any counseling with the debt counseling firm, presumably because she has not as yet
formally enrolled in the program.
After reviewing Applicant’s response, I provided her an additional week to provide an
executed debt consolidation plan and documentation of any fee and debt payments to the
consolidation firm.  Applicant did no provide any additional documentation or progress updates, and
 Department Counsel’s efforts to telephonically reach her concerning any additional documents were
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not successful.  With this confirmation from Department Counsel, I closed the record on March 28,
2007.
Applicant waived her procedural entitlement to 15 days advance notice of the hearing.  She
received the notice within 15 days of the hearing (R.T., at 15).
SUMMARY OF PLEADINGS
Under Guideline F, Applicant is alleged to have incurred numerous delinquent debts: She is
alleged to have incurred 12 delinquent debts altogether (with several charged off before 2002), which
exceed $12,000.00 in total.  For her response to the SOR,  Applicant admitted most of her debt-
related allegations, and provided explanations about several of her debts.
FINDINGS OF FACT
Applicant is a 37-year-old claims associate of a defense contractor who seeks a
trustworthiness determination.  The allegations covered in the SOR and admitted to by Applicant
are incorporated herein by reference and adopted as relevant and material findings.  Additional
findings follow.
Applicant is married and has three children.  Her husband worked for a local manufacturer
for 13 to 14 years before losing his job in 2001.  He was out of work for over two years before
finding new employment in October 2003 (R.T., at 26).  During the two years her husband was
unemployed, Applicant was the lone  financial supporter of her household with her current job and
had to make up for the 50 per cent contributions from her husband (R.T., at 26, 28-29).  By the time
her husband lost his job, Applicant already had two debts that had been charged off: credit card debt
for $1,562.00 (creditor 1.a) and loan for $1,469.00 (creditor 1.b). Unable to stay current with her
bills on her single income, she fell behind with her debts as well.  Altogether, she accumulated 12
debts exceeding $12,000.00, which were either charged off, or placed for  collection, or carried on
the creditor’s books as a delinquent account.
Applicant separated from her husband in December 2003 but remains married to him (R.T.,
at 30).  He provides financial support for their children, but not enough to enable Applicant to pay
her current debts, contribute her share of child support on her youngest son, and pay off her old debts
(R.T., at 31, 38).  Of the listed debts  in the SOR, she can point to just one that she is certain she paid
(her creditor 1.I debt) after making agreed on monthly payments (see ex. 4; R.T., at 36-37).  Her
April 2005 personal financial statement reports a net remainder of just $75.68 (see 2), and she has
no feasible way of paying all of her debts at this time.  The creditors she has contacted in the past
(none within the last year) demanded payment of most the reported balances (R.T., at 38-39).
Currently, two of her children live with their in-laws; they provide both physical and financial
support for the children at a time when Applicant’s finances are stretched way too thin.  Her third
child (a 19-year old step son of her husband’s) is in school.
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Before the hearing, Applicant had never sought credit counseling and never pursued a
Chapter 13 plan (R.T., at 40). She attributes a lack of money to fund counseling and attorneys to her
failure to pursue credit counseling and Chapter 13 relief (R.T., at 40, 44-45)   She attempted to
obtain loans to pay off her debts but was unsuccessful, and she has no available family support to
help her with her debts (R.T., at 42-43).  
Since her hearing, Applicant has inquired about a debt consolidation program (see exs. B and
C).  Under the debt payment agreement proposed to her in December 2006, her identified delinquent
debts with be paid according to an amortized monthly payment schedule.  The proposed plan calls
for a monthly payment from Applicant in the amount of $480.00.  This payment is then allocated
among her identified creditors holding claims totaling $11,524.35 according to a monthly payment
schedule (see ex. C).  The proposed debt consolidated agreement is executed by the credit counseling
agent, but not by Applicant.  In her attached e-mail to Department Counsel, Applicant indicates only
that the attached proposal “is the agreement that they are willing to set up with me” (see ex. B).  She
did not indicate any receipt of counseling or whether and under what circumstances she is prepared
to go forward with this debt consolidation proposal. 
Afforded an opportunity to provide documentation of her executing the debt consolidation
proposal and proof of any fee and debt payments to debt consolidation firm (see ex. E), Applicant
confirmed  that she had not executed the proposal or made any payments to the consolidation firm
(ex. F).  She indicated the consolidation firm couldn’t proceed with a payment plan until it had the
original account numbers of her creditors, which she was endeavoring to obtain (see ex. F).
Applicant was given and additional week to document her execution of the debt plan and provide
proof of any payments to the firm, but failed to do so.  The record closed without any documented
payment plan, fee and debt payments, or received counseling. 
Applicant is a team leader for her employee group and is highly regarded by friends and co-
workers who know her (R.T., at 27). Her documented performance evaluations covering the years
2002 through 2005 report work efforts that either exceed or meet expectations (see ex. A). 
POLICIES
On April 9, 1993, the Composite Health Care Program Office (CHCSPO), the Defense Office
of Hearing and Appeals (DOHA), and the Assistant Secretary of Defense for Command, Control,
Communication and Intelligence (ASDC31), entered into a Memorandum of Agreement (MOA),
which gave DOHA responsibility to provide trustworthiness determinations for contractor personnel
working on unclassified Information Systems Positions as defined in DoD Regulation 5200.2-R.
The Adjudicative Guidelines covered in both DoD  Directive 5220.6 and DoD Regulation
5200.2-R list Guidelines to be considered by judges in the decision making process covering DOHA
cases.  These Guidelines require the judge to consider all of the "Conditions that could raise a
trustworthiness concern and may be disqualifying” (Disqualifying Conditions), if any, and all of the
"Mitigating Conditions," if any, before deciding whether or not a trustworthiness determination
should be granted, continued or denied.  The Guidelines do not require the judge to assess these
factors exclusively in arriving at a decision.  In addition to the relevant Adjudicative Guidelines,
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judges must take into account the pertinent considerations for making a whole person assessment
of the individual seeking a trustworthiness determination. In determining whether the applicant
qualifies for a sensitive position under the trustworthiness standards of DoD 5200.2-R, the applicant
must be provided the due procedural protections contained in the Directive.
Viewing the issues raised and evidence as a whole, the following adjudication policy factors
are pertinent herein:
Financial Considerations
The Concern: An individual who is financially overextended is at risk at having to engage in illegal
acts to generate funds.  Unexplained influence is often linked to proceeds from financially profitable
criminal acts.
Burden of Proof
By virtue of the precepts framed by the Directive, a decision to grant or continue an
Applicant's application for a trustworthiness determination may be made only upon a threshold
finding that to do so is clearly consistent with the national interest.  Because the Directive requires
Administrative Judges to make a common sense appraisal of the evidence accumulated in the record,
the ultimate determination of an applicant's eligibility for an ADP I/II/III position depends, in large
part, on the relevance and materiality of that evidence.  As with all adversary proceedings, the Judge
may draw only those inferences which have a reasonable and logical basis from the evidence of
record.  Conversely, the Judge cannot draw factual inferences that are grounded on speculation or
conjecture.
The Government's initial burden is twofold: (1) It must prove any controverted fact[s] alleged
in the Statement of Reasons and (2) it must demonstrate that the facts proven have a material bearing
to the applicant's eligibility to obtain an ADP I/II/III position.  The required showing of material
bearing, however, does not require the Government to affirmatively demonstrate that the applicant
has actually abused a trust relationship before it can deny or revoke a trustworthiness determination.
Rather, consideration must take account of cognizable risks that an applicant may deliberately or
inadvertently fail to adhere to principles of trust.
Once the Government meets its initial burden of proof of establishing admitted or
controverted facts, the evidentiary burden shifts to the applicant to establish his or her
trustworthiness  through evidence of refutation, extenuation or mitigation of the Government's case.
CONCLUSIONS
Applicant is a highly regarded claims analyst for a defense contractor who accumulated a
number of delinquent debts during periods of financial set backs primarily attributable to her
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husband’s loss of employment. With the limited resources available to her, she has barely been able
to keep up with her current household expenses and debts and has not been able to pay on any of her
old debts.  To be sure, most of her old debts are barred by statutes of limitation.  Still, she
acknowledges the listed debts and has recently explored debt consolidation arrangements. 
Security concerns are raised under the financial considerations guideline of the Adjudicative
Guidelines where the individual applicant is so financially overextended that he or she is at risk of
having to engage in illegal acts to generate funds.  Applicant’s accumulation of delinquent debts,
which heretofore she has not been in a position to address, warrant the application of two of the
disqualifying conditions (DC) of the Adjudicative Guidelines for financial considerations: DC 1 (a
history of not meeting financial obligations) and DC 3 (inability or unwillingness to satisfy debts).
Extenuating circumstances are associated with Applicant’s lack of anticipated support from
her husband for a considerable period of time while he was out of work and the limited support he
has provided since they separated in December 2003.  MC 3 of the financial considerations guideline
(the conditions that resulted in the behavior were largely beyond the person’s control (e.g., loss of
employment, a business downturn, unexpected medical emergency, or a death, divorce, or
separation) is clearly applicable to Applicant’s situation. 
Because of the limited income available to Applicant over the past six years, Applicant has
not heretofore been in a position to address her old debts.  Several of Applicant’s listed debts were
charged off before 2002.  The remaining debts (save for one) have been charged off since November
2004, or earlier.  None of Applicant’s listed debts reflect any collection action by the individual
creditors involved.  Based on this record, all of Applicant’s debts appear to be barred from collection
by the pertinent statute of limitation in South Carolina for debts.  See S.C. Code Ann. Sec. 15-3-530.
While statutes of limitation in general are considered important policy tools for discouraging
plaintiffs from pursuing stale claims and promoting finality in litigation, they have never been
equated with good-faith efforts to repay overdue creditors.  See, e.g.,  ISCR Case No. 02-30304, at
3 (App. Bd. April 2004)(quoting ISCR Case No. 99-9020, at 5-6 (App. Bd. June 2001).
Applicant does not assert relevant statutes of limitation in South Carolina in her defense.  She
continues to work with her credit consolidation firm on identifying her old creditors in connection
with the debt consolidation proposal she produced.  Despite many months of trying to identify the
original account numbers of these creditors, she has apparently been unable to do so.  Without these
original account numbers, she insists the credit consolidation firm is not prepared to move forward
with its debt consolidation proposal.  Without a formal plan presented to her by the consolidation
firm, she has been unwilling to formally commit to the program with an executed agreement.  Absent
an formal agreement, she has not been willing to pay the required  up-front fees and/or advance
payments for ultimate disbursement to the creditors she hopes to identify.
Whatever the problems Appellant has encountered in identifying her old creditors, she has
not articulated them sufficiently to permit assessments of the source of her difficulties, or when she
can expect to provide the needed information.  She provides no plausible reasons either for
withholding her written approval of the consolidation proposal and paying the conditioned fees
pending completion of a formulated repayment plan. 
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Without some type of documented repayment stream with her creditors, or at the very least
an executed debt consolidation repayment/counseling t plan to reinforce her repayment
commitments, she may not yet claim good faith mitigation benefits.  MC 6 of the guidelines for
financial considerations (the individual initiated a good-faith effort to repay overdue creditors or
otherwise resolve debts) can have no application for Applicant in this case.  Her failure to formally
commit to counseling with the debt consolidation/counseling firm she has been corresponding with
precludes her reliance on MC 4 (the person has received or is receiving counseling for the problem
and there are clear indications that the problem is being resolved or is under control) of the
guidelines as well.
Holding a favorable trustworthiness determination involves the exercise of important fiducial
responsibilities, among which is the expectancy of consistent trust and candor.   Financial stability
in a person cleared to access information covered by privacy rights is required precisely to inspire
trust and confidence in the holder of the trustworthiness determination. 
Applicant’s acknowledging her debts incurred during extenuating circumstances and
exploring debt consolidation with financial counselors to address her debts reflects responsibility and
an encouraging beginning for her.  She failed to seal her debt consolidation efforts with a written
agreement, however, and at this time remains uncommitted to a repayment program.  
Taking into account all of the extenuating facts and circumstances surrounding Applicant’s
debt accumulations, the positive judgment and trustworthiness impressions she has made on her
friends and colleagues, her solid performance evaluation, and her still incomplete repayment
initiatives she is able to document at this time, Applicant fails to mitigate trustworthiness concerns
related to her debts.  Unfavorable conclusions warrant with respect to the allegations covered by the
financial considerations guideline.
In reaching my decision, I have considered the evidence as a whole, including each of the
factors enumerated in the preamble of Appendix 8 of DoD Regulation 5200.2-R.
FORMAL FINDINGS
In reviewing the allegations of the SOR in the context of the findings of fact, conclusions and
guidelines listed above, this Administrative Judge makes the following formal findings:
FINANCIAL CONSIDERATIONS: AGAINST APPLICANT
Sub-para. 1.a: AGAINST APPLICANT
Sub-para. 1.b: AGAINST APPLICANT
Sub-para. 1.c: AGAINST APPLICANT
Sub-para. 1.d: AGAINST APPLICANT
Sub-para. 1.e: AGAINST APPLICANT
Sub-para. 1.f: AGAINST APPLICANT
Sub-para. 1.g: AGAINST APPLICANT
Sub-para. 1.h: AGAINST APPLICANT
Sub-para. 1.I:             FOR APPLICANT
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Sub-para. 1.j: AGAINST APPLICANT
Sub-para. 1.k: AGAINST APPLICANT
Sub-para. 1.l: AGAINST APPLICANT
DECISION
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 Applicant’s eligibility for a public trust position.
Eligibility for an ADP I/II/III position is denied. 
Roger C. Wesley
Administrative Judge