KEYWORD: Financial; Personal Conduct
DIGEST: Applicant is 61 years old, divorced, and has five adult children.  She works for a defense
contractor in the health care industry.  She had income tax liabilities incurred as long ago as 1985
based on under withholding of her taxes.  She made this mistake because she relied on bad advice
from co-workers years ago.  She has now corrected her tax information, and mitigated the financial
considerations and personal conduct trustworthiness concerns.  Eligibility for an ADP I/II/III position
is granted.
CASENO: 06-00343.h1
DATE: 04/06/2007
DATE:  April 6, 2007
In re:
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SSN:  -----------
Applicant for ADP I/II/III Position
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ADP Case No. 06-00343
DECISION OF ADMINISTRATIVE JUDGE
PHILIP S. HOWE
APPEARANCES
FOR GOVERNMENT
D. Michael Lyles, Esq., Department Counsel
FOR APPLICANT
Pro Se
SYNOPSIS
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Applicant is 61 years old, divorced, and has five adult children.  She works for a defense
contractor in the health care industry.  She had income tax liabilities incurred as long ago as 1985
based on under withholding of her taxes.  She made this mistake because she relied on bad advice
from co-workers years ago.  She has now corrected her tax information, and mitigated the financial
considerations and personal conduct trustworthiness concerns.  Eligibility for an ADP I/II/III position
is granted.
Adjudication of trustworthiness cases for ADP I, II, and III positions are resolved using the provisions of DoD1
Directive 5220.6 (Directive), pursuant to the memorandum from Carol A. Haave, Deputy Under Secretary of Defense
for Counterintelligence and Security to DOHA Director, Adjudication of Trustworthiness Cases (Nov. 19, 2004).
Pursuant to Exec. Or. 10865, Safeguarding Classified Information within Industry (Feb. 20, 1960), as amended2
and modified, and the Directive.
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STATEMENT OF THE CASE
The Defense Office of Hearings and Appeals (DOHA) declined to grant or continue a
position of trust for Applicant .  On October 30, 2006, DOHA issued a Statement of Reasons  (SOR)1 2
detailing the basis for its decision–trustworthiness concerns raised under Guideline F (Financial
Considerations) and Guideline E (Personal Conduct) of the Directive.  Applicant answered the SOR
in writing on November 13, 2006, and elected to have a hearing before an administrative judge.  The
case was assigned to me on December 12, 2006.  On February 7, 2007, I convened a hearing to
consider whether it is clearly consistent with the national interest to grant or continue a
trustworthiness determination for Applicant.  The Government and the Applicant submitted exhibits
that were admitted into evidence.  At the conclusion of the hearing, Applicant was given additional
time to submit exhibits.  Two exhibits were received and marked as Exhibits D and E without
objection from the Government. DOHA received the hearing transcript (Tr.) on February 15, 2007.
FINDINGS OF FACT
Applicant's admissions to the SOR allegations are incorporated as findings of fact.  After a
complete and thorough review of the evidence in the record, and full consideration of that evidence,
I make the following additional findings of fact:
Applicant is 61 years old, divorced since the early 1980s, and has five adult children, whom
she raised by herself.  All have college educations.  Applicant works for a defense contractor in the
health care industry as a lead worker in her office area.  She has worked for this employer for the past
three years.  She rents an apartment and pays $342 monthly because she also works as a caretaker
at the apartment building to keep her rent low.  Her caretaker work included painting a two-story
apartment building. (Tr. 34, 41, 42; Exhibits 1, 2, 3)
Applicant lived with a friend who died suddenly in July 2006 at 85 years of age.  While they
lived together he gave her money to pay his expenses and to pay his bills.  Applicant and her friend
went to casinos as recreation, but she no longer goes to them.  She has changed her lifestyle since
his death.  Her expenses are minimal because one of her daughters pays for her car insurance and
repairs in exchange for Applicant dog sitting her pet.  Applicant fully paid for her car, a 2002 model.
She has had no significant medical expenses in her life so far.  She has only basic television cable
service to save money.  Her cell phone is part of a family plan arrangement for which her daughter
pays the bill.  Applicant has no land-line telephone.  Applicant has no credit cards. (Tr. 32-35, 39;
Exhibit 2)
In the early 1980s, after her divorce, a co-worker of Applicant advised her to maintain her
income tax exemptions as she had while married.  She did so, and kept them even as her children
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reached their majority and departed her home.  She consistently filed her tax returns each year.  The
Internal Revenue Service (IRS) and her state tax department discovered her exemptions exceeded
what she was lawfully allowed to claim, and began to assess her back taxes in the late 1980s.  They
also sought to include the money her friend gave her as her additional income. Applicant owed
additional taxes for a number of tax years.  When she started her current job, she adjusted her
exemptions and there are no current tax liabilities owed.  From the time the IRS started billing her
for unpaid taxes, Applicant has been paying $100 on an installment agreement while contesting the
additional income claims, penalties and interest that accumulated.  In 2002 her attorney
recommended she file Chapter 7 bankruptcy to rid herself of those and any taxes that could be
discharged.  She filed a Chapter 7 bankruptcy in May 2002, and was discharged in bankruptcy on
September 4, 2002.  Her debts were listed as $13,256, and her assets as $6,500.  She listed the 1989
and 2000/2001 taxes in Schedules E and F of the bankruptcy.  Applicant thought her tax liabilities
were included in the bankruptcy, even as she continued to pay $175 monthly on the installment
agreement for federal taxes.  She paid $50 monthly on her state tax lien.  She answered Question 20
(Was she now over 180 days delinquent on any loan or financial obligation) on her public trust
position questionnaire (PTPQ) with a negative answer.  She answered this way because she had been
paying for years on her installment agreement and did not consider herself delinquent on any debt
on August 25, 2004, when she completed the PTPQ. (Tr. 19-28, 31, 37, 38, 46; Exhibits 1, 2, 3, 4,
C, D)
Applicant’s debts listed in the SOR are all IRS debts (Subparagraphs 1.b. to 1.i., 1.k. to 1.o.).
One debt ($893.84) was owed to her state tax authority (Subparagraph 1.j.), but she repaid that debt
and the state tax lien was released on September 28, 2006.  The specific SOR allegations and the
current status of each tax debt is as follows:
SOR PARAGRAPH TAX YEAR and DEBT CURRENT STATUS
1.b. 1985 IRS $303.32 Lien released Tr. 21, Exhibit B
1.c. 1986 IRS $10,406.20 Lien released Tr. 21, Exhibit B
1.d. 1989 IRS $167 Lien released Tr. 21, Exhibits B, 3
1.e. 1990 IRS $404.79 Lien released Tr. 21, Exhibit B
1.f. 1996 IRS $1,502.71 Paid in full, Exhibit D
1.g. 1997 IRS $4,159.89 Paid in full, Exhibit D
1.h. 1998 IRS $299.27 Paid in full, Exhibit D
1.i. 1999 IRS $4,942.07 Paying$100 monthly, Tr. 23, Exhibit C
1.j. 1999 State tax, $893.84 Paid, lien released, Tr. 19, Exhibits 6, A
1.k. 2000 IRS $904.56 Paying, included in bankruptcy, Tr. 23,
Exhibits 3 and C
1.l. 2001 IRS $1,429.93 Paying, listed in bankruptcy, Tr. 23,
Exhibits 3 and C
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1.m. 2002 IRS $1,488.36 Paying, and 2006 tax refund of $1,034
applied to debt, Exhibit D installment
plan
1.n. 2003 IRS $1,350.92 Paying, Exhibit D installment plan
1.o. 2004 IRS $236.95 Paying, Exhibit D installment plan
Applicant will start receiving a pension from a previous employment in July 2007.  That
pension amount is calculated presently at $419 monthly.  Applicant will apply all or part of this
income to further reduce her tax debt and increase her $100 monthly installment plan payments. (Tr.
36; Exhibit E)
POLICIES
As Commander in Chief, the President has “the authority to . . . control access to information
bearing on national security and to determine whether an individual is sufficiently trustworthy to
occupy a position . . . that will give that person access to such information.” Department of the Navy
v. Egan, 484 U.S. 518, 527 (1988).  The President has authorized the Secretary of Defense or his
designee to grant applicants eligibility for access to classified information “only upon a finding that
it is clearly consistent the national interest to do so.”  Exec. Or. 10865, Safeguarding Classified
Information with Industry § 2 (Feb. 20, 1960).  By direction of the Under Secretary of Defense for
Counterintelligence and Security, adjudications of cases forwarded to DOHA by the Defense
Security Service or the Office of Personnel Management (OPM) for a trustworthiness determination
shall be conducted under the provisions of the Directive.  Eligibility for a position of trust is
predicated upon the applicant meeting the guidelines contained in the Directive and a finding it is
clearly consistent with the national interest to do so. See Directive ¶ 2.3.  An applicant “has the
ultimate burden of demonstrating that it is clearly consistent with the national interest to grant or
continue his trustworthiness determination.” See Directive ¶ E3.1.15
The adjudication process is based on the whole person concept.  Enclosure 2 of the Directive
sets forth personnel security guidelines, as well as the disqualifying conditions (DC) and mitigating
conditions (MC) under each guideline that must be carefully considered in making the overall
common sense determination required.  The decision to deny an individual eligibility to occupy a
position of trust is not necessarily a determination as to the loyalty of the applicant.  See Exec. Or.
10865 § 7.  It is merely an indication that the applicant has not met the strict guidelines the President
and the Secretary of Defense have established for issuing a such a determination.
In evaluating the trustworthiness of an applicant, the administrative judge must also assess
the adjudicative process factors listed in ¶ 6.3 of the Directive.  Those assessments include:  (1) the
nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the conduct, and
the extent of knowledgeable participation; (3) how recent and frequent the behavior was; (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 (See Directive, Section E2.2.1. of Enclosure 2).  Because each case
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presents its own unique facts and circumstances, it should not be assumed that the factors exhaust
the realm of human experience or that the factors apply equally in every case.  Moreover, although
adverse information concerning a single condition may not be sufficient for an unfavorable
determination, the individual may be disqualified if available information reflects a recent or
recurring pattern of questionable judgment, irresponsibility, or other behavior specified in the
Guidelines.
Initially, the Government must establish, by substantial evidence, conditions in the personal
or professional history of the applicant that disqualify, or may disqualify, the applicant from being
eligible to occupy a position of trust.  The Directive presumes a nexus or rational connection
between proven conduct under any of the disqualifying conditions listed in the guidelines and an
applicant’s trustworthiness suitability.  See ISCR Case No. 95-0611 at 2 (App. Bd. May 2, 1996).
All that is required is proof of facts and circumstances that indicate an applicant is at risk for
mishandling classified information, or that an applicant does not demonstrate the high degree of
judgment, reliability, or trustworthiness required of persons handling classified information.  ISCR
Case No. 00-0277, 2001 DOHA LEXIS 335 at **6-8 (App. Bd. 2001).  Once the Government has
established a prima facie case by substantial evidence, the burden shifts to the applicant to rebut,
explain, extenuate, or mitigate the facts.  See Directive ¶ E3.1.15.  An applicant “has the ultimate
burden of demonstrating that is clearly consistent with the national interest to grant or continue his
trustworthiness determination. ISCR Case No. 01-20700 at 3 (App. Bd. 2002).  “Any doubt as to
whether access to classified information is clearly consistent with national security will be resolved
in favor of the national security.” Directive ¶ E2.2.2
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:
The Concern. Failure or inability to live within one’s means, satisfy debts, and meet financial
obligations may indicate poor self-control, lack of judgment, or unwillingness to abide by rules and
regulations, all of which can raise questions about an individual’s reliability, trustworthiness and
ability to protect classified information. An individual who is financially overextended is at risk of
having to engage in illegal acts to generate funds.  Compulsive gambling is a concern as it may lead
to financial crimes including espionage.  Affluence that cannot be explained by known sources of
income is also a security concern.  It may indicate proceeds from financially profitable criminal
acts.
The Concern: Conduct involving questionable judgment, lack of candor, dishonesty, or
unwillingness to comply with rules and regulations can raise questions about an individual’s
reliability, trustworthiness and ability to protect classified information. Of special interest is any
failure to provide truthful and candid answers during the security clearance process or any other
failure to cooperate with the security clearance process. 
“The standard that must be met for . . . assignment to sensitive duties is that, based on all
available information, the person’s loyalty, reliability, and trustworthiness are such that  . . .
assigning the person to sensitive duties is clearly consistent with the interests of national security.”
(Regulation ¶ C6.1.1.1)  Appendix 8 of the Regulation sets forth the adjudicative policy, as well as
the disqualifying conditions (DC) and mitigating conditions (MC) associated with each guideline.
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DoD contractor personnel are afforded the adjudication procedures contained in the Directive.
(Regulation ¶ C8.2.1)
CONCLUSIONS
Guideline F: Financial Considerations.  All of Applicant’s alleged delinquent financial
obligations are tax debts, which she has been paying for many years.  She was willing and able to
pay these obligations, so they were not delinquent.  They arose through an error on her part in
claiming too many tax exemptions.  She has a history of meeting her financial obligations.  I
conclude there are no Disqualifying Conditions (DC) that apply in this case under this Guideline.
Guideline E: Personal Conduct.  The SOR alleges Applicant deliberately falsified her
answer to Question 20 about delinquent debts more than 180 days past due when she completed the
PTPQ in August 2004.  However, Applicant had been paying her tax debts for several years on a
valid installment payment agreement with the respective tax authorities.  Therefore, the tax
obligations were not delinquent in the context that she had ignored paying any of the debt.  She also
filed Chapter 7 bankruptcy in 2002 to attempt to rid herself of some of the penalties and interest, and
certain taxes.  She relied on the advice given her by her tax attorney.  Applicant’s presentation and
explanation of her actions is credible and persuasive.  I conclude there are no DCs that apply under
this Guideline because she told the truth as she knew it to be, and particularly because she had been
paying regularly for years on her tax debt.
Whole Person Analysis
“The adjudicative process is an examination of a sufficient period of a person’s life to make
an affirmative determination that the person is eligible for a" trustworthiness decision. Directive
E2.2.1.  “Available, reliable information about the person, past and present, favorable and
unfavorable, should be considered in reaching a determination.” Id.  In evaluating Applicant’s case,
I have considered the adjudicative process factors listed in the Directive ¶ E2.2.1.
Applicant’s ignorance of the exemption requirements and calculations under the income tax
laws, and her good-faith reliance on her co-workers and attorney, resulted in her tax liabilities, dating
back to 1985.  She has repaid a number of tax liabilities, and continues to work diligently to satisfy
her debts.  The IRS and state tax authority have each released liens they filed because Applicant
repaid the tax debts.  Applicant corrected her exemption form and has not repeated her mistake.
Although an adult when these errors occurred, she was naive and unsophisticated about the tax law
requirements.  She rehabilitated herself financially with the help of her late friend and daughter.  She
leads a simple cash-based lifestyle with no frivolities.  Based on all of these factors, I conclude the
financial considerations, personal conduct, and whole person analysis for Applicant.
FORMAL FINDINGS
The following are my conclusions as to each allegation in the SOR:
Paragraph 1.  Guideline F: FOR APPLICANT
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Subparagraph 1.a. to 1.o.: For Applicant
Paragraph 2.  Guideline E: FOR APPLICANT
Subparagraph 2.a: For Applicant
DECISION
In light of all of the circumstances presented by the record in this case, it is clearly consistent
with the national interest to grant Applicant eligibility for assignment to sensitive duties.  Her
application for eligibility for an ADP I/II/III position is granted.
Philip S. Howe
Administrative Judge