KEYWORD: Financial
DIGEST: Applicant began drinking heavily around 1988 and continued to do so until March 7,
1999, when he stopped drinking. When drinking, he failed to file federal and state income taxes
for a number of years in the 1990s. He also failed to pay other expenses. Although he has paid
his overdue state income taxes, he has not paid his overdue federal income taxes. He recently
filed for Chapter 13 bankruptcy protection and has just started this process. Because his federal
income tax issues remain unresolved, Applicant has not mitigated the financial concerns under
Guideline F. Eligibility is denied.
CASENO: 06-14765.h1
DATE: 07/20/2007
DATE:  July 20, 2007
In Re:
----------------------
SSN: ------------
Applicant for Public Trust Position
)
)
)
)
)
)
)
)
ADP Case No. 06-14765
DECISION OF ADMINISTRATIVE JUDGE
MARY E. HENRY
APPEARANCES
FOR GOVERNMENT
Richard Stevens, Esq., Department Counsel
FOR APPLICANT
Pro Se
 This action was taken under Executive Order 10865, dated February 20, 1960, as amended; and  Memorandum1
from the Deputy Under Secretary of Defense Counterintelligence and Security, titled "Adjudication of Trustworthiness
Cases," dated November 19, 2004.
Tr. at 11.2
2
SYNOPSIS
Applicant began drinking heavily around 1988 and continued to do so until March 7, 1999,
when he stopped drinking. When drinking, he failed to file federal and state income taxes for a
number of years in the 1990s. He also failed to pay other expenses. Although he has paid his overdue
state income taxes, he has not paid his overdue federal income taxes. He recently filed for Chapter
13 bankruptcy protection and has just started this process. Because his federal income tax issues
remain unresolved, Applicant has not mitigated the financial concerns under Guideline F. Eligibility
is denied.
STATEMENT OF CASE
On August 24, 2004, Applicant submitted an application for a position of public trust, an
ADP I/II/III position. The Defense Office of Hearings and Appeals (DOHA) declined to grant the
application under Department of Defense Directive 5220.6, Defense Industrial Personnel Security
Clearance Review Program (Jan. 2, 1992), as amended (the “Directive”).  On February 1, 20071
DOHA issued Applicant a Statement of Reasons (SOR) detailing the basis for its decision. The SOR,
which is in essence the administrative complaint, alleged trustworthiness concerns under Guideline
F (Financial Considerations) of the revised Adjudicative Guidelines (AG) issued on December 29,
2005 and implemented by the Department of Defense, effective September 1, 2006. DOHA
recommended the case be referred to an administrative judge to determine whether eligibility for a
position of trust should be granted, continued, denied, or revoked. On March 5, 2007, Applicant
submitted a notarized response to the allegations. He requested a hearing.
DOHA assigned this case to me on April 4, 2007, and issued a notice of hearing on May 17,
2007. At the hearing on June 4, 2007, Applicant waived his right to receive the notice of the hearing
15 days prior to the hearing. I conducted the hearing as scheduled.  The Government submitted seven2
exhibits (GX) which were marked and admitted into the record as GX 1-7, without objection.
Applicant submitted six exhibits (App Ex), which were marked and admitted as App Ex A-F without
objection. Applicant testified on his own behalf. The record was held open until June 25, 2007, to
allow Applicant to submit further documentation. On that date, Applicant requested additional time
to obtain his documentation, indicating that he had encountered difficulties getting some of the
information requested. I granted his request, giving him until July 6, 2007 to submit his additional
documentation. He timely submitted seven additional documents, which were marked and admitted
as App Ex G-M, without objection. DOHA received the hearing transcript (Tr.) on June 21, 2007.
FINDINGS OF FACT
GX 1 (Applicant’s Questionnaire for a Position of Public Trust, dated August 24, 2004) at 1, 4.3
Tr. at 19, 41-43, 44-45, 51-53.4
Id. at 36, 49-50, 75-76, 82; GX 1, supra note 3, at 65
App Ex B (Medical treatment records); App Ex D (Letter, dated May 15, 2007); Tr. at 20-21, 44, 46-48, 63-64,6
70, 80.
3
In his SOR response, Applicant admits subparagraphs 1.a, 1.b, and 1.f-1.m of the SOR. He
denies the remaining allegations under Guideline F. Applicant’s admissions are incorporated herein.
In addition, after a thorough and careful review of the pleadings, exhibits, and testimony, I make the
following findings of fact.
Applicant, a 52-year-old senior application system analyst for a Department of Defense
contractor, seeks a position of public trust. He started working for the contractor in June 2002.3
Upon his high school graduation in 1973, Applicant enlisted in the U.S. Army. Three years
later, he received an honorable discharge. He then attended college, receiving an Associate of Arts
degree in accounting and data processing at the of age 23. He obtained his first job in the aerospace
industry in June 1978. Over the next 30 years, he worked in private and public sector positions as a
programmer and program analyst. In 1996, his government employer fired him because of a drinking
problem. In 2001, his employer terminated his position in a reduction-in-force action. When he
accepted his current position in 2002, he moved across the country. During his work career, he twice
held a top secret security clearance.4
Applicant married his first wife in 1978. They separated 13 years later and subsequently
divorced. He married his second wife in the 1990s and they later divorced. He married his current
wife in December 2001. He has two children, ages 27 and 23, and two stepchildren, ages 17 and 14.
His son and two stepchildren live with him. His son and stepson will leave for college or further
educational training at the end of the summer.5
Applicant is a recovering alcoholic. In 1988 or 1989, his alcohol consumption increased
significantly. For the next 10 years, he drank to excess on a daily basis. His drinking caused him to
lose his family, home, and job of 10 years. His good financial rating plummeted. Between 1996 and
March 1999, family or friends referred him for alcohol treatment. After each treatment program, he
resumed his drinking. In March 1999, he admitted himself to an alcohol treatment center. He stopped
drinking on March 7, 1999. He participated in outpatient treatment, and continues to attend alcoholic
anonymous programs twice a week. In March 2007, he received a pin for 8 years of sobriety. He states
that his life has improved greatly since he stopped drinking.6
During his period of heavy drinking, Applicant failed to pay his bills, He did not file his
federal income tax returns for the years 1993, 1995, 1996, 1997, and 1998 (allegations 1.i through 1.m
in the SOR). His estimated tax liability is over $70,000, more than 50% of which is for fees, penalties
and interest. He has not yet filed these tax returns, upon the advice of his tax attorney. He has not
contacted the IRS about payment of these taxes, although his tax attorney has spoken with the IRS.
He did attempt to secure money to pay the taxes through the equity in his house. The credit company
denied his request, based on his credit history. He has not otherwise taken any action to resolve his
GX 2 (Applicant’s attachments to government interrogatories) at 3-9; App Ex A (Applicant’s Chapter 137
Bankruptcy Petition); App Ex K (Denial of equity loan, dated March 16, 2007); App Ex L (Additional documents related
to amnesty program); Tr. at 21-22, 29-31, 32-34, 68-69.
Applicant’s response to the SOR, dated March 5, 2007; App Ex M ( Form 1040 for the years 1999, 2000, 2002,8
2003, 2004, 2005, and 2006); Tr. at 27-29, 32.
App Ex A, supra note 7; App Ex I (Payments to Trustee); Tr. at 25-29, 38-39.9
App Ex G (Budget); App Ex H (Earnings statements for May and June 2007).10
App Ex C (Letter, dated June 1, 2007); App Ex E (Letter, dated May 31, 2007); App Ex F (Letter, dated May11
21, 2007); App Ex J (Performance evaluations for 2004, 2005, and 2006 and confidentiality agreement).
4
tax debts. During the 1990s, he also failed to file his state income taxes, which resulted in state tax
liens against him. He participated in a state tax amnesty program, and paid his outstanding state taxes.
The state released the liens it had filed.7
In addition to his failure to file his tax returns, Applicant’s credit reports indicate several
unpaid debts. He denies the debt in allegations 1.c ($303 placed for collection in 2000), 1.d. ($2,747,
which was reported to the collection agency in 1999), and 1.e ($330, which was reported to the
collection agency in 1999). He admitted owing a telephone bill of $180 from 1998, and two medical
bills totaling $2,371 from 1999 (allegations 1.f through 1.h). He has not paid these debts. He has filed
his taxes with the IRS since 1999, and has provided proof of his filings for all years, except 2001. His
recent tax returns indicate that he owed additional taxes on his federal taxes. The record does not
contain any evidence which reflects that these taxes were paid.8
Applicant filed a Chapter 13 bankruptcy petition in 1996 to stop the foreclosure on his house.
He did not follow through with the actions required of him, and the court dismissed his bankruptcy
petition. He filed a Chapter 13 bankruptcy petition on May 14, 2007. He listed all the debts identified
in the SOR, including his federal tax liability. His largest debt is his federal tax debt, which comprises
95% of his bankruptcy debt. On the advice of his tax attorney, he waited to file for bankruptcy until
his tax liability aged sufficiently to allow him to include his tax debt in his bankruptcy filing. His first
bankruptcy creditor’s meeting was held on May 31, 2007. In May 2007, he made his first interim
monthly payment of $100 to the bankruptcy trustee and he made his second payment on June 22,
2007. He will make these interim payments until his full monthly payment is determined.9
Applicant’s gross monthly income is approximately $5,726 and his net monthly income
averages approximately $3,000. His wife works, providing an additional net monthly income of
$1,355 for a total household net income of approximately $4,355. His household expenses total
approximately $4,350, leaving no additional income for the payment of debt.10
Applicant’s performance evaluations for the last three years indicate that he consistently met
his employer’s performance expectations and that his overall work performance steadily improved.
His supervisor describes him as a respected and valued member of his work team, and as trustworthy
and honest. His pastor and a co-worker describe him as trustworthy, reliable, friendly and honest. On
June 15, 2007, Applicant signed a confidentiality agreement required by his employer. Should he
reveal any information protected by privacy rights, he could be terminated immediately.11
Tr. at 75-82.12
Directive, revised Adjudicative Guidelines (AG) ¶2(a)(1)-(9).13
ISCR Case No. 96-0277 at 2 (App. Bd., July 11, 1997).14
ISCR Case No. 97-0016 at 3 (App. Bd., December 31, 1997); Directive, Enclosure 3, ¶ E3.1.14.15
Department of the Navy v. Egan, 484 U.S. 518, 528 (1988). 16
ISCR Case No. 94-1075 at 3-4 (App. Bd., August 10, 1995); Directive, Enclosure 3, ¶ E3.1.15.17
ISCR Case No. 93-1390 at 7-8 (App. Bd. Decision and Reversal Order, January 27, 1995); Directive,18
Enclosure 3, ¶ E3.1.15.
5
Applicant’s wife testified on his behalf. She testified he treats her nicely. She has not seen him
drink and she manages the household bills. His 23-year-old son also testified on his behalf. He
described his childhood memory of his father as always being drunk. Since his father stopped
drinking, they have developed a good relationship.12
POLICIES
The revised Adjudicative Guidelines set forth disqualifying conditions (DC) and mitigating
conditions (MC) applicable to each specific guideline. An administrative judge need not view the
revised adjudicative guidelines as inflexible ironclad rules of law. Instead, acknowledging the
complexities of human behavior, these guidelines, are intended to assist the administrative judge in
reaching fair and impartial common sense decisions. Although the presence or absence of a particular
condition or factor for or against a trustworthiness determination is not outcome determinative, the
revised AG should be followed whenever a case can be measured against this policy guidance. In
addition, each security clearance decision must be based on the relevant and material facts and
circumstances, the whole-person concept, and the factors listed in the Directive. Specifically, these
are: (1) the nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the
conduct; (3) the frequency and recency of the conduct; (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 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.13
The sole purpose of a trustworthiness determination is to decide if it is clearly consistent with
the national interest to grant eligibility for assignment to sensitive duties to an applicant.  The14
government has the burden of proving controverted facts in the SOR that disqualify or may disqualify
the applicant from being eligible for access to classified information.  The burden of proof is15
something less than a preponderance of the evidence.  Once the government has met its burden, the16
burden shifts to the applicant to present evidence of refutation, extenuation, or mitigation to overcome
the case against him.  Additionally, an applicant has the ultimate burden of persuasion to obtain a17
favorable clearance decision.  Conditions that could raise a trustworthiness concern and may be18
disqualifying, as well as those which could mitigate security concerns pertaining to these adjudicative
guidelines, are set forth and discussed in the conclusions below.
Egan, 484 U.S. at 531.19
Id.20
Id.; Directive, revised AG ¶ 2(b).21
Executive Order No. 10865 § 7.22
 Directive, revised AG ¶ 2(b).23
6
No one has a right to a security clearance,  and “the clearly consistent standard indicates that19
security clearance determinations should err, if they must, on the side of denials.”  Any reasonable20
doubt about whether an applicant should be allowed access to sensitive information must be resolved
in favor of protecting such sensitive information.  Section 7 of Executive Order 10865 specifically21
provides industrial security clearance decisions shall be “in terms of the national interest and shall
in no sense be a determination as to the loyalty of the applicant concerned.” The decision to deny an
individual a security clearance is not necessarily a determination as to the allegiance, loyalty, and
patriotism of an applicant.  It is merely an indication that the applicant has not met the strict22
guidelines the President and the Secretary of Defense have established for issuing a clearance. Any
doubt as to whether access to classified information is clearly consistent with national security will
be resolved in favor of the national security.  The same rules apply to trustworthiness determinations23
for access to sensitive positions.
CONCLUSIONS
I have carefully considered all the facts in evidence and the legal standards. The government
has established a prima facie case for disqualification under Guideline F - Financial Considerations.
Financial Considerations
Under Guideline F, the “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.” (AG ¶ 18.) The credit reports reflect liens filed
by the state government for unpaid taxes and unpaid debts, which applicant acknowledged. He also
admitted that he did not file his federal income taxes for five years in the 1990s. Although he paid his
state taxes, he has not paid his federal taxes or his old debts listed in his credit reports. Because of the
age of these debts, their delinquent status, and the amount of the debt, Applicant showed an inability
or unwillingness to pay his debts. Based on the evidence of record, the government established the
applicability of DC ¶ 19 (a) inability or unwillingness to satisfy debts and DC ¶ 19 (c) a history of not
meeting financial obligations.
MC ¶ 26 (a) the behavior happened so long ago, was so infrequent, or occurred under such
circumstances that it is unlikely recur and does not cast doubt on the individual’s current reliability,
trustworthiness, or good judgment may have some application in this case. He filed his first
bankruptcy petition to stop the foreclosure sale of his house more than 11 years ago, in 1996. Since
See ISCR Case No. 04-07360 at 2 (App. Bd. Sept. 26, 2006) (stating partial credit was available under FCMC24
6 for debts being resolved through garnishment). 
7
this action is old and was done for the sole purpose of stopping the foreclosure sale of his house, it has
little relevance to his current financial issues. Since the failure to file income taxes last occurred in
1998, it was long ago, although not infrequent. His tax liability issues arose because he is an alcoholic
who drank to excess on a daily basis in the 1990s, and who placed his drinking ahead of his financial
obligations. He stopped drinking on March 7, 1999. Since this time, he has slowly worked to repair
his finances and other personal issues caused by his drinking. 
MC ¶ 26 (b) the conditions that resulted in the financial problem were largely beyond the
person’s control (e.g., loss of employment, a business downturn, unexpected medical emergency, or
a death, divorce or separation), and the individual acted responsibly under the circumstances has
some applicability. His alcoholism was not a condition beyond his control or an unexpected medical
problem. He knew that his drinking was creating many problems, including financial and employment,
but he refused to accept he had a problem for a long time. In 2001, however, his employer’s decision
to lay him off in a reduction-in-force action, which had no relationship to his past drinking problems,
impacted his ability to improve his finances for awhile.
Applicant never met with a financial counselor and significant back taxes are due. Thus, MC
¶ 20 (c) the person has received or is receiving counseling for the problem and/or there are clear
indications that the problem is being resolved or is under control has no applicability.
MC ¶ 20 (d) the individual initiated a good-faith effort to repay overdue creditors or otherwise
resolve debts applies in part. Applicant’s tax issues are significant. Recently, he filed for Chapter 13
Bankruptcy, which allows him to repay his debts under the protection of the bankruptcy court. He
waited until now to file for bankruptcy because his tax attorney recommended that he allow his unfiled
taxes to age. By so doing, he could include the taxes in his bankruptcy if he was current in his taxes.
He also attempted to obtain an equity loan on his house to help pay his tax debt, but could not get
approval because of his past credit history.
The creditors for the unpaid bills in allegations 1.b through 1.h of the SOR are barred from
collecting these debts under the state in which he resides 3-year statute of limitations. See State Code.
Ann. § 15-3-530.  Thus, he receives partial credit for debt resolution because these debts are no longer24
collectible. The State Court of Appeals succinctly explained the societal and judicial value of
application of the statute of limitations:
Statutes of limitations embody important public policy considerations in that they
stimulate activity, punish negligence and promote repose by giving security and
stability to human affairs. The cornerstone policy consideration underlying statutes of
limitations is the laudable goal of law to promote and achieve finality in litigation.
Significantly, statutes of limitations provide potential defendants with certainty that
after a set period of time, they will not be ha[led] into court to defend time-barred
claims. Moreover, limitations periods discourage plaintiffs from sitting on their rights.
Statutes of limitations are, indeed, fundamental to our judicial system.
8
Carolina Marine Handling, Inc. v. Lasch, 609 S.E.2d 548, 552 (Ct. App. 2005) (internal quotation
marks and citations omitted).
Elimination of these delinquent debts, which equal only 5% of his unpaid debt, through the
statute of limitations has not ended his potential vulnerability to improper financial inducements
because his unpaid federal taxes make him still “financially overextended”. In recent years, he has not
incurred excessive unpaid debt. 
Although Applicant disputes three debts alleged in the SOR, he has not provided any evidence
that he has formally disputed these debts with his creditors. Thus, MC ¶ 20 (e) the individual has a
reasonable basis to dispute he legitimacy of the past-due debt which is the cause of the problem and
provides documented proof to substantiate the basis of the dispute or provides evidence of actions to
resolve the issue does not apply. Likewise, MC ¶ 20 (f) the affluence resulted from a legal source of
income does not apply as there is no evidence of unusual income in this case.
Whole Person Analysis
In all adjudications, the protection of our national security is the paramount concern. The
objective of the trustworthy determination process is the fair-minded, commonsense assessment of a
person’s life to make an affirmative determination that the person is eligible for assignment to sensitive
duties. Indeed, the adjudicative process is a careful weighing of a number of variables in considering
the “whole person” concept. It recognizes that we should view a person by the totality of his acts,
omissions, motivations and other variables. Each case must be adjudged on its own merits, taking into
consideration all relevant circumstances, and applying sound judgment, mature thinking, and careful
analysis.
Applicant performs his duties well and is respected by his co-workers and supervisors for his
work ethic and integrity. He is to be praised for accepting that he is an alcoholic, for stopping his
drinking, and for taking steps to improve his life, especially his personal relationships. Since doing so,
he has slowly improved the quality of his life, including his financial management. Old debt has been
resolved by operation of law. However, the failure to file his federal tax returns for five years and his
failure to correct this conduct after he stopped drinking continues to raise serious concerns under the
AG. While recognizing he followed legal advice on how to manage his tax problems, the fact remains
that his federal income tax issues remain unresolved. He filed for bankruptcy protection as a means
to resolve this issue. He is just beginning the bankruptcy process. Thus, he has not yet established a
permanent payment plan and a track record for consistently complying with the terms of the payment
plan. I have weighed the mitigating factors, his sobriety and accompanying change in behavior and
attitude towards his responsibilities, including his finances, his recommendations against the
seriousness of his failure to file his income tax returns for five years and the lack of any efforts to
resolve this issue until recently. The seriousness of his conduct in regards to his tax issues outweighs
the favorable evidence and mitigating factors. Applicant has not mitigated the government’s concerns.
FORMAL FINDINGS
Formal Findings for or against Applicant on the allegations set forth in the SOR, as required
by Section E3.1.25 of Enclosure 3 of the Directive, are:
9
SOR ¶ 1-Guideline F: AGAINST APPLICANT
Subparagraph 1.a: For Applicant
Subparagraph 1.b: For Applicant
Subparagraph 1.c: For Applicant
Subparagraph 1.d: For Applicant
Subparagraph 1.e: For Applicant
Subparagraph 1.f: For Applicant
Subparagraph 1.g: For Applicant
Subparagraph 1.h: For Applicant
Subparagraph 1.i: Against Applicant
Subparagraph 1.j: Against Applicant
Subparagraph 1.k: Against Applicant
Subparagraph 1.l: Against Applicant
Subparagraph 1.m: Against Applicant
DECISION
In light of all of the evidence presented in this case, it is not clearly consistent with the national
interest to grant Applicant eligibility for assignment to sensitive duties. Eligibility is denied.
Mary E. Henry
Administrative Judge