KEYWORD: Financial
DIGEST: Applicant’s approximately $10,000 in unresolved debt has grown from her having to rely
only on her  income to support her two children ages ten and eight as well her decision to support
her boyfriend for seven years while he has been unemployed.  While she has performed well in her
position for two years, she has only paid two debts out of ten.  She states she plans to pay the other
debts, but failed to develop a payment plan or challenge the debts with the remaining creditors.
Consequently, she failed to mitigate the government’s concerns under Guideline F.  Eligibility for
trustworthiness is denied.
CASENO: 06-17307.h1
DATE: 07/23/2007
DATE: July 23, 2007
In Re:
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SSN: -----------
Applicant for Public Trust Position
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ADP Case No. 06-17307
DECISION OF ADMINISTRATIVE JUDGE
KATHRYN MOEN BRAEMAN
APPEARANCES
FOR GOVERNMENT
Candace Le’i, Esquire, Department Counsel
FOR APPLICANT
Pro Se
SYNOPSIS
 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.
2
Applicant’s approximately $10,000 in unresolved debt has grown from her having to rely
only on her  income to support her two children ages ten and eight as well her decision to support
her boyfriend for seven years while he has been unemployed.  While she has performed well in her
position for two years, she has only paid two debts out of ten.  She states she plans to pay the other
debts, but failed to develop a payment plan or challenge the debts with the remaining creditors.
Consequently, she failed to mitigate the government’s concerns under Guideline F.  Eligibility for
trustworthiness is denied.
STATEMENT OF CASE
On November 14, 2006, the Defense Office of Hearings and Appeals (DOHA) declined to
grant the application  for a position of public trust under Department of Defense Directive 5220.6,
Defense Industrial Personnel Security Clearance Review Program (Jan. 2, 1992), as amended (the
"Directive").    Consequently, DOHA issued a Statement of Reasons (SOR) detailing the basis for1
its decision and  alleged security concerns under Guideline F (Financial Considerations) in paragraph
1.  In her notarized Answer dated December 9, 2006, Applicant responded to the SOR allegations
and denied paragraph 1 but admitted all of the allegations in subparagraphs 1.a.  through 1.j., and
requested a hearing. 
On January 26, 2007, Department Counsel noted the case was ready to proceed.  The matter
was assigned to another judge on February 2, 2007. Subsequently, a Notice of Hearing, issued on
February 22, 2007, set the matter for March 8, 2007, at a location near where Applicant works and
lives.  The case was re-assigned to me on March 5, 2007, because of the unavailability of the
previous judge.  
At the hearing on March 8, 2007, Applicant waived her right to 15 days notice of the hearing,
which was conducted as scheduled. (TR 7)  The government submitted six exhibits which were
marked and admitted into the record as Exhibits 1-6 without objection. (TR 16-18)  Applicant
submitted three exhibits which were marked and admitted into the record as Exhibits A-C without
objection. (TR 19-20)   She testified on her own behalf. The record was held open for two weeks
until March 22, 2007, to allow Applicant to submit further documents.  (TR 59-62; 69;  81)  She
submitted additional documents by March 22, 2007, which were marked and admitted as Exhibits
D through F on March 23, 2007, as Department Counsel stated she had no objection. The record
closed on March 23, 2007.  DOHA received the hearing transcript (TR.) on March 19, 2007.
FINDINGS OF FACT
In her SOR response, Applicant admitted to all specific SOR allegations, but denied
paragraph 1 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
3
of fact.
Applicant, a 26-year-old woman seeking a position of public trust, has worked as an intake
representative claims associate for a Department of Defense contractor for two years since March
2005. (Exhibit 1; Exhibit D)  
Applicant has technical college training as a “medical biller” which she received in May
2004.  (Exhibit 1) 
Financial Considerations
She has never married, but has a boyfriend and two children ages ten and eight whom she
supports without any child support from their fathers. (Exhibit 1; TR 15; 35; 68)  Applicant
explained that she has been on her own since she was 14 years old and moved in with her first
boyfriend who was 16 and his family.  She later moved to another city at age 17 to live with her
current boyfriend when she was pregnant; she began to have financial problems at that time in 1999.
She learned that her father’s insurance would not cover the birth of her son, and she was too young
to apply for county assistance.  (TR 20-21; 34)  Her current boyfriend for nine years does not work;
she supports him as he has been unemployed for seven years.  (TR 36-37; 55; 64-67; 68) For
example, when he could not pay the gas bill, she had it switched to her name but had to pay off his
debt in December 2006 in order to have the account transferred.  (TR 46) She also recently chose
to pay towards another credit card debt that took her focus off paying the debts itemized in the SOR.
(Exhibit 4; TR 57-58)
A review of Applicant’s credit reports dated April 21, 2005, August 18, 2006, January 12,
2007, her response to the Interrogatories, and her Answer to the SOR show 10 unpaid debts totaling
approximately $10,000. (Exhibits 2, 4, 5, 6)  The current status of these debts is as follows:
SOR ¶ TYPE OF DEBT (date) AMOUNT CURRENT STATUS
1.a Collection account for
towing in March 2004
$     1,307.00 Unpaid; in February 2007
she made arrangements to
pay $150 per month with
post-dated checks.  In March
2007 she paid this $1,662
debt in full and had a zero
balance.  (TR 23, 37-38, 44;
Exhibits A, E)
1.b. Collection account for
cable from 2005
$       304.00 Unpaid as she stated the
cable company could not
find the account; however,
the debt is still reflected on
her 2007 credit report.  She
has not asked that it be
removed.  (TR 27-28; 42-44)
4
1.c Collection account for
debt delinquent since
2001
$     71.00 Applicant paid this account
in February 2007. (Exhibit B;
TR 24, 28; 44-45)
1.d Collection account for
cable from 2003
$     491.00 Unpaid as the cable company
could not find the account;
however, the debt is still
reflected on her 2007 credit
report and she has not asked
that it be removed.   (TR 28-
29; 42-44)
1.e Collection account for
broadband in 2001
$       166.00 Unpaid.  She explained she
was mistaken when she
stated in her Answers to the
Interrogatories that she had
“made payment
arrangements” for this debt. 
(Exhibit 2; TR 29)
1.f Collection account from
library from 2002 
$     292.00 Unpaid; she has the books,
but has not returned them as
she was “being lazy.” (TR
30)
1.g Collection account from
2000
$ 3,530 Account was charged off in
September 2000; Applicant
made a phone call to the
hospital to learn the status,
but the bill remains unpaid. 
They advised she still owes
just $731 and $407.50; but
she provided no
documentation on how this
debt was reduced. (TR 22-
24; 30-31, 47-51)
1.h Collection account from
fire department 
$ 593.00 Unpaid; she does not know
why she owes this money
and has not investigated. 
(TR 31; 51-52)
1.i Collection account for
telephone
$2,939.00 Unpaid for land line
telephone bill.  (TR 32)
 Department of the Navy v. Egan, 484 U.S. 518, 527 (1988).  2
5
1.j Collection account from
towing 
$ 550.00 Unpaid; she believes this bill
is a duplicate of 1.a.;
however she conceded that it
might be another debt as she
had two different account
numbers and two bills. (TR
33; 39-41)
Applicant’s  monthly pay is $2,100. (TR 25)  Her monthly expenses total  $2,099 including
$685 for rent, $50 for electricity, $50 for gas, $59 for telephone, $400 for groceries; $160 for
gasoline, $200 for car insurance; $60 for a credit card payment; $185 for a car payment, and $150
for one debt payment, $100 for clothing.  She has another credit card to cover dental expenses for
her children where she owes $800 and is paying $25 per month.  (Exhibit C; TR 25-26; 37-38)  The
2007 credit report showed another debt for $560; however, she disputed that debt.  (Exhibit 4; TR
52-53)  She has been trying to pay her debts one at a time but they have her “emotionally frustrated.”
(TR 54)  She intended to try to contest certain debts, but has not done so.  (TR 55)
In November 2006 after she received the SOR, Applicant called a credit counseling agency
to help resolve her credit problems, but was advised she would be better of paying each debt on her
own as that would help raise her credit score.  She has not explored bankruptcy or developed a plan
to pay her remaining overdue bills.  (TR 26; 34; 56-57)  
References and Evaluation
Applicant submitted numerous references for her co-workers stating that she is a hard worker
and gets along well with everyone at work.  She was also assessed as being honest and polite.   Her
lead supervisor stated she holds Applicant in ‘high regard as she is always polite, punctual and
pleasant.” She is efficient and valued as an employee.   (Exhibit D)
Her March 2007 evaluation documents stated that she achieved her goals which is a mid-
range evaluation.  (Exhibit F)
POLICIES
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.”  In Executive Order 10865, Safeguarding2
Classified Information Within Industry (Feb. 20, 1960), the President set out guidelines and
procedures for safeguarding classified information and determining trustworthiness within the
executive branch. 
To be eligible for a security clearance or access to sensitive information, an applicant must
 Directive, ¶ E2.2.1.3
 Id.4
 Id.5
 Directive, ¶ E3.1.14.6
 Directive, ¶ E3.1.15.7
 ISCR Case No. 01-20700 at 3 (App. Bd. December 19, 2002).8
6
meet the security guidelines contained in the Directive. Enclosure 2 of the Directive sets forth
personnel security guidelines, as well as the disqualifying conditions and mitigating conditions under
each guideline. The adjudicative guidelines at issue in this case are: 
Guideline F - Financial Considerations 
18. 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.
Conditions that could raise a trustworthiness concern and may be disqualifying, as well as those
which could mitigate security concerns pertaining to these adjudicative guidelines, are set forth and
discussed in the conclusions below.
"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 security clearance.  An administrative3
judge must apply the “whole person concept,” and consider and carefully weigh the available,
reliable information about the person.  An administrative judge should consider the following4
factors: (1) the nature, extent, and seriousness of the conduct; (2) the circumstances surrounding the
conduct, to include knowledgeable participation; (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 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.   5
Initially, the Government must present evidence to establish controverted facts in the SOR
that disqualify or may disqualify the applicant from being eligible for access to classified
information.  Thereafter, the applicant is responsible for presenting evidence to rebut, explain,6
extenuate, or mitigate the facts.  An applicant “has the ultimate burden of demonstrating that it is7
clearly consistent with the national interest to grant or continue his security clearance.”  Any doubt8
 Directive, ¶ E2.2.2.9
  AG ¶ 20 (a)  the behavior happened so long ago, was so infrequent, or occurred under such circumstances10
that it is unlikely to recur and does not cast doubt on the individual’s current reliability, trustworthiness, or good
judgment.
  AG ¶ 20(c) the person has received or is receiving counseling for the problem and/or there are clear11
indications that the problem is being resolved or is under control.
7
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 determinations9
for access to sensitive positions. (Exhibit 3)
CONCLUSIONS
Financial Considerations
After carefully considered all the facts in evidence and the legal standards, I conclude the
government established a prima facie case for disqualification under Guideline F, Financial
Considerations. 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 or trustworthiness.  Based
on all the evidence, Financial Considerations Disqualifying Conditions (FC DC) 19(a) Inability or
unwillingness to satisfy debts) and 19(c) A history of not meeting financial obligations) apply to
Applicant's case. Applicant has many unpaid, delinquent debts documented by her credit reports dated
April 21, 2005, August 18, 2006, January 12, 2007, her response to the Interrogatories, and her
Answer to the SOR.  The 10 debts alleged total approximately $10,000.  While she recently paid two
creditors, she has not made an effort or developed a plan to resolve the remaining eight debts.  While
she was advised by a credit counseling service to approach her debts on a one by one basis, she has
such limited funds that she has made only limited progress.  In February 2007 she resolved only one
small debt from 2001 (SOR 1.c.) and in March 2007 she paid one large debt for towing her car from
2004 (SOR 1.a.).  Another debt for towing her car (1.j) remains unresolved as well as debts to a cable
company, telephone companies, the hospital where her son was born, and even the library for unpaid
fines and books which she concedes she was “too lazy” to return.  
While I carefully considered the Financial Considerations Mitigating Conditions (MC), I
conclude MC   20(a)  does not apply as her financial problems have persisted and are not limited to10
a period “long ago.”  Neither are they “infrequent.”  She still carries a significant amount of
outstanding delinquent debts for a variety of bills incurred over several years. Applicant has only paid
one small debt and one larger debt out of the ten she acknowledged.  
Neither does 20 (c)  apply.  Although Applicant contacted a credit counseling agency to help11
resolve her credit problems after she got the SOR, she did not work out any arrangements with this
agency to either challenge or resolve the debts listed on her credit report. While her plan is to pay a
bill one by one, she does not have a timetable or a plan for how she will do so to resolve these
significant delinquent debts which she admits have persisted since 1999.  
  AG ¶ 20(b) the conditions that resulted in the behavior were largely beyond the person’s control (e.g., loss12
of employment, a business downturn, unexpected medical emergency, or a death, divorce or separation) and the
individual acted responsibly under the circumstances.   
The Board has previously explained what constitutes a “good faith” effort to repay overdue creditors or13
otherwise resolve debts:
In order to qualify for application of Financial Considerations Mitigating Condition 6, an applicant
must present evidence showing either a good-faith effort to repay overdue creditors or some other
good-faith action aimed at resolving the applicant’s debts. The Directive does not define the term
‘good-faith.’ However, the Board has indicated that the concept of good-faith ‘requires a showing that
a person acts in a way that shows reasonableness, prudence, honesty, and adherence to duty or
obligation.’
(internal citation and footnote omitted) ISCR Case No. 02-30304 at 3 (App. Bd. Apr. 20, 2004) (quoting ISCR Case No.
99-9020 at 5-6 (App. Bd. June 4, 2001)). In ISCR Case No. 99-9020 at 6 (App. Bd. Dec. 1, 1999), the Appeal Board
specifically addressed application of the statute of limitations, stating a “person who decides not to honor his or her debts
may be able to avoid paying those debts until they are legally uncollectible because the statute of limitations has run.
Reliance on the running of a statute of limitations would be a legally permissible course of action. However, it would
not demonstrate a good-faith effort to resolve one’s debts that would fall under the meaning of Financial Considerations
Mitigating Condition 6.” See ISCR Case No. 03-10880 (App. Bd. June 24, 2005); ISCR Case No. 01-09691 (App. Bd.
Mar. 27, 2003) (stating an applicant must do more than merely cite the statute of limitations to obtain the full benefit of
FC MC 6). See also ISCR Case No. 01-09691 at 3 (App. Bd. Mar. 27, 2003) (“[E]ven if a delinquent debt is legally
unenforceable under state law, the federal government is entitled to consider the facts and circumstances surrounding
an applicant’s conduct in incurring and failing to satisfy the debt in a timely manner.”); ISCR Case No. 98-0349 at 2-3
(App. Bd. Feb. 3, 1999) (even though an applicant’s delinquent debts were not legally collectible because of the statute
of limitations, that fact did not preclude the Administrative Judge from considering the applicant’s failure to resolve the
delinquent debts before the statute of limitations ran). Cf. ISCR Case No. 01-04425 at 3-4 (App. Bd. May 17, 2002)
(adverse Guideline F conclusions possible where applicant chose not to pay her delinquent debts, waited until her
creditors ceased trying to collect those delinquent debts, and they were eventually dropped from her credit report.).
8
She did show that under MC 20(b)  there were conditions that resulted in financial problems12
that were largely beyond her control.  She had substantial responsibilities as a young woman when
she became a mother to two children as a teenager.  To her credit she has supported both children
without any child support.  On the other hand, she has also chosen to support her boyfriend, who is
the father of her son and whom she has known for nine years, even though he has been unemployed
for seven years, so he has not worked to provide any income or support for his son.  Indeed, she
testified that one reason she could not pay the debts alleged in the SOR was that she had to pay one
of his debts.  That conduct does not seem reasonable under the circumstances as there is no evidence
that he has a disability or any other reason for not working to contribute to the family income. 
Finally, the Applicant has only begun to take the first steps on the path to show a good-faith
effort to resolve these debts as only two out of ten have been paid.  So 20.d., the individual initiated
a good-faith effort to repay overdue creditors or otherwise resolve debts, is applicable only in part to
two allegations, 1.a. and 1.c. A promise to pay in the future is not sufficient to mitigate the financial
considerations concern or evidence of a good faith effort to repay debt. She entered into a payment
plan with one creditor in February 2005 with post-dated checks and then documented she paid off the
debt in March 2007, but did not explain how she found those resources on her limited income.
Overall she failed to establish that she has changed her financial practices and now makes timely all
her payments.   13
Neither did she not establish that she had challenged any of the remaining debts even though
See ISCR Case No. 04-06242 at 2 (App. Bd. June 28, 2006).14
9
she was not certain about the status of some of the debts, such as to a county fire department.  Neither
did she provide any evidence she returned the overdue books to the library as she had testified she
planned to do to mitigate concerns over a large library debt.  While some debts might be barred by
a state statute of limitations, she provided no evidence that any of them fell within that statute.
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 their 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.
I have considered all the evidence and the “whole person” in evaluating Applicant's
trustworthiness. As noted above, Applicant's lengthy history of failing to meet her financial
obligations, and inability or unwillingness to satisfy her debts raises serious trustworthiness concerns.
She is 26 years old and now sufficiently mature to be fully responsible for her conduct. Although in
a relationship for nine years, she has chosen to assume full responsibility for all household living
expenses for  her and his debts.. Given her limited income, she had to make choices about how to use
her limited resources. She does pay her living expenses; however, she did not establish she pays those
debts  timely.  While in 2006 she sought help to resolve her debt through credit counseling, she did
not pursue that  avenue. Neither has she demonstrated that she has a budget and lives within it.  She
failed to provide strong evidence of rehabilitation, positive behavior changes, and self-discipline in
regards to her finances. While she has been steadily employed for the last two years and is favorably
regarded at work, that positive record is insufficient to establish a case in mitigating in light of her
slowness or inability to resolve the majority of her long-standing debts. 
In sum, the likelihood of new debt problems is probable given her limited resources.  Financial
concerns remain as Applicant has only stated an intent to resolve her delinquent debts, but  failed to
develop or present a timetable for a payment plan.  After weighing the disqualifying and mitigating
conditions, and all the facts and circumstances, in the context of the whole person,   I conclude she14
has failed to mitigate the trustworthiness concerns pertaining to financial considerations.  
FORMAL FINDINGS
After reviewing the allegations of the SOR in the context of the Adjudicative Guidelines in
Enclosure 2 and the factors set forth under the Adjudicative Process section, I make the following
formal findings, as required by Section E3.1.25 of Enclosure 3 of the Directive:
SOR1 Guideline F: AGAINST APPLICANT
10
Subparagraph 1.a.: For Applicant
Subparagraph 1.b.: Against Applicant
Subparagraph 1.c.: For Applicant
Subparagraph 1.d.: Against Applicant
Subparagraph 1.e.: Against Applicant
Subparagraph 1.f.: Against Applicant
Subparagraph 1.g.: Against Applicant
Subparagraph 1.h.: Against Applicant
Subparagraph 1.i.: Against Applicant
Subparagraph 1.j.: 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.
Kathryn M. Braeman
Administrative Judge