KEYWORD: Personal Conduct; Criminal Conduct
DIGEST: Applicant’s deliberate falsification of his clearance applications and his financial
irresponsibility render him unsuitable for access to classified information. Clearance denied.
CASENO: 06-26104.h1
DATE: 07/30/2007
DATE:  July 30, 2007
In Re:
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SSN: -----------
Applicant for Security Clearance
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ISCR Case No. 06-26104
DECISION OF ADMINISTRATIVE JUDGE
JOHN GRATTAN METZ, JR
APPEARANCES
FOR GOVERNMENT
Francisco J. Mendez, Jr., Esquire, Department Counsel
FOR APPLICANT
Pro Se
SYNOPSIS
Applicant’s deliberate falsification of his clearance applications and his financial
irresponsibility render him unsuitable for access to classified information. Clearance denied.
Required by Executive Order 10865 and Department of Defense Directive 5220.6, as amended and1
modified—most recently in August 2006 (Directive).
2
STATEMENT OF THE CASE
Applicant challenges the 23 April 2007 Defense Office of Hearings and Appeals (DOHA)
Statement of Reasons (SOR) recommending denial or revocation of his clearance because of
personal conduct and financial considerations.  Applicant answered the SOR 14 May 2007, and1
requested a hearing. DOHA assigned the case to me 12 June 2007, and I convened a hearing 28 June
2007. DOHA received the transcript (Tr.) 10 July 2007.
FINDINGS OF FACT
Applicant admitted the SOR allegations of deliberately falsifying two security clearance
applications in ¶1, but denied the allegations of financial delinquencies in ¶2, except for  ¶2.e.
Accordingly, I incorporate his admissions as findings of fact.
Applicant—a 45-year-old security guard employed by a defense contractor since September
2005—seeks to retain the access to classified information he has had, as needed, since approximately
1982.
When Applicant completed clearance applications in December 1993 (G.E. 1), July 1999
(G.E. 2), and April 2001 (G.E. 3), he truthfully disclosed an April 1992 arrest for felony assault with
a deadly weapon—charges which were ultimately dropped. He failed to list this arrest on his
September 2005 clearance application, which he attributes to an oversight.
When Applicant completed clearance applications in July 1999 and April 2001, he failed to
disclose two automobile repossessions within the last seven years—in November 1995 and January
1996. In his September 2005 clearance application, he failed to disclose delinquent accounts. He has
offered no credible explanation why he failed to disclose his financial difficulties, as he was aware
on all three occasions that he had negative financial information required to be disclosed on the
applications. In particular, he had been interviewed in May and June 2000 about the repossessions
as part of the background investigation begun in July 1999. That investigation terminated in June
2000, when Applicant no longer needed a clearance in his job (G.E. 5).
Applicant has a history of financial difficulties dating to at least November 1995, when his
first automobile was repossessed. Applicant purchased the automobile in June 1994, failed to make
the first payment on time, and ultimately was unable to keep up with the payments. The automobile
was repossessed in November 1995 and sold in March 1996,  resulting in a deficiency balance of
nearly $6,600, which remains unpaid. After the November repossession, Applicant bought a second
automobile in January 1996, which he considered to be a lemon, although he never pursued lemon
law or other consumer protection complaints against the seller. He surrendered the automobile
voluntarily in August 1996, and the seller reported a deficiency of over $9,000. When Applicant was
interviewed about these accounts in May and June 2000, he stated that he had not made payment on
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either of the debts (G.E. 5). He reported nearly $800 per month negative cash flow based on his
regular salary, but did not feel that he was over-extended because he frequently worked overtime.
Applicant married in February 2002. He and his wife had difficulty managing their finances
and eventually fell delinquent on several accounts, including the mortgage on a house they bought
in August 2003. Applicant acknowledged (Tr. 40-41) that they sometimes spent money on frivolous
things and did not utilize a budget. 
When Applicant was interviewed about his clearance in April 2006 (G.E. 5), he
acknowledged three delinquent accounts (SOR 2.b., 2.c., and 2.d..), as well as several medical
collection accounts (SOR 2.a.). He explained that he and his wife bought a home in August 2003 for
$178,000 and refinanced it in 2004 for $192,000, but he had experienced a brief period of
unemployment in February 2005, resulting in the delinquent accounts. He acknowledged receiving
dunning letters and telephone calls from his creditors, but did not have the funds to repay them.
Although he intended to repay his creditors when he was able, he had no specific plan for addressing
his debts, even though he knew that his job might be in jeopardy. Indeed, he took no steps to repay
his creditors until after he received DOHA interrogatories in February 2007 (G.E. 7). Those
interrogatories showed Applicant having $125 per month negative cash flow. In the wake of those
interrogatories, Applicant again refinanced his home, using cash out to pay all of the debts alleged
in the SOR (.A.E. A), except 2.e., which remains unpaid because the creditor had archived his
records and not yet been able to retrieve them (Tr. 38). He was not able to refinance his home any
earlier because of his low credit score (Tr. 37). Although the mortgage company offered him credit
counseling along with the refinancing, Applicant declined because he believes his wife was
responsible for most of his financial difficulties (Tr. 74-75).
Applicant’s supervisor considers him an honest employee and recommends him for his
clearance (Tr. 92-95). He does not appear to be aware of Applicant’s financial difficulties or his
falsification of his clearance applications.
POLICIES AND BURDEN OF PROOF
The Directive, Enclosure 2 lists adjudicative guidelines to be considered in evaluating an
Applicant’s suitability for access to classified information. Administrative Judges must assess both
disqualifying and mitigating conditions under each adjudicative issue fairly raised by the facts and
circumstances presented. Each decision must also reflect a fair and impartial common sense
consideration of the factors listed in Section 6.3. of the Directive. The presence or absence of a
disqualifying or mitigating condition is not determinative for or against Applicant. However, specific
adjudicative guidelines should be followed whenever a case can be measured against them, as they
represent policy guidance governing the grant or denial of access to classified information.
Considering the SOR allegations and the evidence as a whole, the relevant, applicable, adjudicative
guidelines are guidelines E (Personal Conduct) and F (Financial Considerations).
Security clearance decisions resolve whether it is clearly consistent with the national interest
to grant or continue an Applicant’s security clearance. The government must prove, by something
less than a preponderance of the evidence, controverted facts alleged in the SOR. If it does so, it
establishes a prima facie case against access to classified information. Applicant must then refute,
See, Department of the Navy v. Egan, 484 U.S. 518 (1988).2
¶16.(a) deliberate omission, concealment, or falsification of relevant and material facts from any personnel3
security questionnaire, personal history statement, or similar form used to conduct investigations, . . . [or] determine
security clearance eligibility or trustworthiness. . .;
¶19.(a) inability or unwillingness to satisfy debts; (b) indebtedness caused by frivolous or irresponsible4
spending and the absence of any evidence of willingness or intent to pay the debt or establish a realistic plan to pay the
debt; (c) a history of not meeting financial obligations; . . . (e) consistent spending beyond one’s means, which may be
indicated by excessive indebtedness, significant negative cash flow, high debt-to-income ratio, and/or other financial
analysis;
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extenuate, or mitigate the government’s case. Because no one has a right to a security clearance, the
Applicant bears a heavy burden of persuasion.
Persons with access to classified information enter into a fiduciary relationship with the
government based on trust and confidence. Therefore, the government has a compelling interest in
ensuring each Applicant possesses the requisite judgement, reliability, and trustworthiness of those
who must protect national interests as their own. The “clearly consistent with the national interest”
standard compels resolution of any reasonable doubt about an Applicant’s suitability for access in
favor of the government.2
CONCLUSIONS
The government established a case for disqualification under Guideline E, and Applicant did
not mitigate the security concerns, except for ¶1.a.. Having previously disclosed his April 1992 arrest
on several earlier clearance applications, it is unlikely he deliberately omitted this arrest from his
September 2005 clearance application. Further, the circumstances and disposition of that arrest were
no longer relevant or material to a clearance determination in 2005. However, Applicant knew he
had adverse financial information that should have been reported on clearance applications in July
1999, April 2001, and September 2005. He has offered no credible explanation for his failure to
disclose that information. I conclude he deliberately concealed the nature and extent of his financial
problems on his clearance applications.  In addition,  none of the Guideline E mitigating conditions3
apply. The concealed information was relevant to a clearance decision. I conclude Guideline E
against Applicant.
The government established a case for disqualification under Guideline F, and Applicant did
not mitigate the security concerns. Government records reflect nearly $13,000 of delinquent debt
acquired between November 1995 and April 2005.  Applicant attributes most of his financial4
problems to his wife, yet many of the debts were accrued before he married. Further, he experienced
financial difficulties while he was in the military. While his unemployment in 2005 may have
affected his finances some, it is clear the majority of his financial problems are attributable to his
inability to live within his means, his unwillingness to seek and utilize financial counseling, and his
failure to establish any financial cushion for unforeseen expenses.
¶20 (a) the behavior happened so long ago, was so infrequent, or occurred under such circumstances that it is5
unlikely to recur . . . 
¶20.(b) the conditions that resulted in the financial problem were largely beyond the person’s control . . . and6
the individual acted responsibly under the circumstances;
¶20.(c) the person has received or is receiving counseling for the problem and there are clear indications that7
the problem is being resolved or is under control;
¶20.(d) the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.8
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Applicant meets none of the mitigating factors for financial considerations. His financial
difficulties are both recent and multiple;  indeed they may be ongoing. Applicant has not established5
that his debts were due to circumstances beyond his control, or that he has acted responsibly in
addressing his debts.  There is no evidence that he has sought credit counseling or otherwise brought6
the problem under control.  Although he refinanced his home and paid the majority of his7
outstanding debts just before the SOR was issued, the timing of the payments does not constitute a
good-faith effort to satisfy his debts.  Further, given his unwillingness to seek or use financial8
counseling, there is nothing in the record to suggest that Applicant will put his financial problem
behind him. I conclude Guideline F against Applicant.
FORMAL FINDINGS
Paragraph 1. Guideline E: AGAINST APPLICANT 
Subparagraph a: For Applicant
Subparagraph b: Against Applicant
Subparagraph c: Against Applicant
Paragraph 2. Guideline F: AGAINST APPLICANT
Subparagraph a: Against Applicant
Subparagraph b: Against Applicant
Subparagraph c: Against Applicant
Subparagraph d: Against Applicant
Subparagraph e: 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 a security clearance for Applicant. Clearance denied
 
John G. Metz, Jr.
Administrative Judge