KEYWORD: Financial; Personal Conduct
DIGEST: Applicant is 57 years old, and works for a computer company on contract to a Government
contractor in the health care industry.  She has two delinquent debts for 2002 and 2003, which
resulted from a divorce, a home business , and periods of unemployment.  Applicant thought she
used a legal method to resolve the debts in 2002 and 2003, but discovered she made an honest
mistake as to the efficacy of a debt elimination “program” she purchased from a vendor.  However,
she mitigated the financial considerations, personal conduct, and criminal conduct trustworthiness
concerns.  Her eligibility for a trustworthiness position is granted.
CASENO: 06-25552.h1
DATE: 10/03/2007
DATE:  October 3, 2007
In re:
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SSN:  -----------
Applicant for a Public Trust Position
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ADP Case No. 06-25552
DECISION OF ADMINISTRATIVE JUDGE
PHILIP S. HOWE
APPEARANCES
FOR GOVERNMENT
Caroline H. Jeffreys, Esq., Department Counsel
FOR APPLICANT
Jeffrey Grady, Personal Representative
SYNOPSIS
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Applicant is 57 years old, and works for a computer company on contract to a Government
contractor in the health care industry.  She has two delinquent debts for 2002 and 2003, which
resulted from a divorce, a home business , and periods of unemployment.  Applicant thought she
used a legal method to resolve the debts in 2002 and 2003, but discovered she made an honest
mistake as to the efficacy of a debt elimination “program” she purchased from a vendor.  However,
she mitigated the financial considerations, personal conduct, and criminal conduct trustworthiness
concerns.  Her eligibility for a trustworthiness 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 March 12, 2007, DOHA issued a Statement of Reasons  (SOR)1 2
detailing the basis for its decision–trustworthiness concerns raised under Guideline F (Financial
Considerations), Guideline E (Personal Conduct), and Guideline J (Criminal Conduct) of the revised
Adjudicative Guidelines of the Directive issued on December 29, 2005, and implemented by the
Department of Defense, effective September 1, 2006.  Applicant answered the SOR in writing on
March 30, 2007, and elected to have a hearing before an administrative judge.  The case was
assigned to me on June 20, 2007.  
On August 6, 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 submitted exhibits that were admitted into evidence without objection.  Applicant
testified in her case.  At the conclusion of the hearing, I left the record open until August 20, 2007,
for the submission of exhibits.  I received them in a timely manner.  The Department had no
objection, so I marked them as Exhibits A to E, and admitted them into evidence.  DOHA received
the hearing transcript (Tr.) on August 20, 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 57 years old, divorced after 31 years of marriage, and works for a defense
contractor in the computer business.  Her current employer evaluates her as dependable and
conscientious.  She had periods of unemployment from August 1999 to July 2000, then November
2001 to October 2002, and November 2004 to April 2005.  She was divorced in 2002. (Tr. 12, 41,
42, 53; Exhibit 1)
Applicant paid her bills and mortgage while married.  She and her former husband had credit
cards for 20 years and paid them in full.  While unemployed, and moving around the U.S. between
2002 and 2006, to work on various contractual jobs, she borrowed money from her family upon
which to live.  She repaid the $3,000 she borrowed from her mother, and the $5,000 she  borrowed
from her father after 2005.  She continues to owe her sister $3,000, but her sister declines repayment.
Applicant is committed to repaying that loan also.  Applicant’s credit record shows all credit card
and other debts as paid in full or current, except for two credit card debts owed to two banks.  The
first delinquent debt is for $11,487.  The other delinquent debt is for $9,532.  These debts date from
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2002 when Applicant had a home business and was being divorced. (Tr. 15, 16, 19, 32, 41; Exhibits
2-5)
Applicant ceased paying these two accounts in 2002.  She paid $2,000 to obtain debt
elimination “program” materials (CDs, books, course materials) from a company to learn how to get
rid of these two debts.  She sent letters using the “program” suggested formats to the two creditors,
which letters stated, in part, 
“I am disputing the amount because I believe that (the bank) failed to credit my account for
money or credits accepted from me.  I believe that (the bank) accepted my signed note(s) and
other promises to pay into new bank money and credits, but failed to disclose those material
facts to me.  I believe that I am entitled to receive these new credits or (the bank) would be
receiving something for nothing, while profiting from my fruit (sic) and labor.”  
The form letter demanded the creditor bank provide an affidavit that it did not follow Generally
Accepted Accounting Principles, did not follow Federal Reserve Bank policies and procedures, that
the bank “prohibits the party that funds the loan or extension of credit to be repaid,” and that the
bank “disclosed to me that they would create new money based on my note or similar instrument
and that I am not entitled to those credits or money.”  The letter then referred to the Fair Credit
Reporting Act. (Tr. 17, 21, 31, 33, 35-39, 43; Exhibits 2-5, B-E) 
Another form letter Applicant used cited 15 U.S. C. §1666 as authority for Applicant not
repaying these debts.  That section of the U.S. Code provides procedures for correcting billing errors
on credit card statements.  Applicant believes that because the banks did not contact her, the debts
were eliminated and closed.  One creditor sent her a IRS Form 1099-c for tax year 2006 for $8,502
in cancelled debt,  of the original $11,487 listed in the SOR.  Applicant paid tax for 2006 on that
amount as income.  Applicant does not have the CDs or other materials from the “program.” (Tr.
17, 21, 31, 33, 35-39, 43; Exhibits 2-5, B-E) 
Applicant’s exhibits contained copies of the form letters and the letters she sent to the two
banks.  The justifications and statutes  listed by Applicant in these form letters are not valid legal
bases for avoiding repayment of debt when she merely ceased paying the debts.  However, Applicant
honestly believes she was following a legitimate “program” to rid herself of these two debts.  She
does not intend to repay these debts because she does not believe she owes them.  Applicant could
not remember where she obtained the $2,000 to buy the debt elimination “program” while
continuing to owe these two credit cards. (Tr. 17, 21, 31, 33, 35-39, 43; Exhibits 2-5, B-E)
Applicant did not list these two debts on her public trust application form (PTA) she
completed on March 9, 2006, because she believed they were closed and did not have to be paid.
She did not consider them as debts.  She knew they were on her credit report at the time she
completed the PTA.  Question 22.b. on the PTA form requested an Applicant disclose any
delinquent debts currently more than 180 days past due.  Applicant answered “no” to that question.
(Tr. 37-39; Exhibit 1)
POLICIES
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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 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,
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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:
Guideline F: Financial Considerations: 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 could 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 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. ¶18
Guideline E: Personal Conduct: 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. ¶15
Guideline J: Criminal Conduct: The Concern: Criminal activity creates doubt about a
person’s judgment, reliability, and trustworthiness.  By its very nature, it calls into question a
person’s ability or willingness to comply with laws, rules and regulations. ¶30
“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.  DoD
contractor personnel are afforded the adjudication procedures contained in the Directive. (Regulation
¶ C8.2.1)
CONCLUSIONS
Guideline F:  Applicant owed two credit card debts in 2002.  While undergoing a painful
divorce, and some unemployment, Applicant sought and found an advertised as legitimate way to
rid herself of these two sizeable debts.  Examining the exhibits offered by Applicant, it is clear to
me that the arguments and reasons cited in the “program” letters are not legal, but are fallacious and
delusive.  Nonetheless, Applicant in her naivete and legal ignorance, paid $2,000 for this instruction
program and thought she had rid herself of these two debts.  On creditor cancelled the debt in 2006
and Applicant had to pay the tax on that income.  That debt (Subparagraph 1.a of the SOR) does not
exist now because of the cancellation.  The other debt continues to exist.  Applicant and her former
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husband had a history of paying debts, according to her testimony, which I find believable, and the
credit reports submitted as exhibits.
The disqualifying condition applicable is Financial Considerations Disqualifying Condition
(DC) ¶19.a. (inability or unwillingness to satisfy debts).  Applicant was unable at the time to pay
the debt.  Now she honestly believes that the debt is not owed.  
Applicant had financial difficulties in 2002, resulting from her divorce and unemployment.
Her record of paying her current bills and responsibly managing her money in the past and present
weighs heavily in her favor.  Her honest belief in the correctness of the actions she took also count
in her favor.  The actions were five years ago and have not been repeated.  Her debt problems in
2002 and 2003 were contrary to the record of payments on debts she made before and after that
period of time.  She thought she was using a legal method to dispute her debts and resolve them
through that process.  She was mistaken, but no one told her that at the time, nor apparently until the
hearing on this issue was any dispute about the legitimacy of that “program” brought to her
attention.
She relied on the representations and information sold to her by this “program” provider.  She
provided proof of her efforts to resolve the two largest debts according to the lessons in this
“program.”
Therefore, Mitigating Conditions (MC) ¶20.a. (the behavior happened so long ago, was so
infrequent, or occurred under such circumstances that it is unlikely to recur and does not cast doubt
on the individual’s current reliability, trustworthiness, or good judgment), ¶20.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), ¶20.d (the individual initiated a good-faith
effort to repay overdue creditors or otherwise resolve debts), and ¶20.e (the individual has a
reasonable basis to dispute the 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) apply.  
Guideline E:  Applicant did not list the two debts set forth in Subparagraphs 1.a and 1.b of
the SOR on her PTA form in 2006.  She denied the allegations in Paragraph 2 of the SOR in her
Answer.  She effectively admitted at the hearing she did not list them, but explained her
understanding that having followed the “program” she bought, the debts were no longer owed.
Therefore, in her mind, they were not 180 days or more past due, so they did not exist, and she did
not have to list them.  Wrong though she was, she made an honest mistake.  Her testimony and
demeanor at the hearing convince me she truly believed what the “program” told her to do about the
debts.  With no further contact from the creditors, she thought they had accepted her explanations,
and the debts were no longer collectible.  Therefore, she did not deliberately falsify her answers to
Question 22.b on the PTA form.  None of the Disqualifying Conditions under Guideline E apply.
Guideline J:  This guideline is applicable if Applicant willfully and knowingly made a false
statement or representation to the U.S. Government.  It works in tandem with the allegation of
deliberate falsification under Guideline E.  For the same reasons stated under that Guideline E, I
conclude Applicant did not make a willful and knowing false statement on her PTA form in
Question 22.b.  No DC apply, and no MC need apply.
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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.
In evaluating these factors, in addition to the DC and MC of the specific guidelines, I
considered the totality of the evidence in view of the “whole person” concept.  I considered
Applicant’s age and length of marriage when her marriage dissolved.  I looked at her past and
present record of debt payments contained on the credit reports, noting that the period of her divorce
and unemployment caused her financial problems and debt repayment problems out of the usual and
customary pattern in her life.  I considered that only two debts were at issue, and that Applicant
honestly thought she was resolving them by using valid procedures under Federal law, which was
her motivation for that conduct.  Her lack of legal sophistication and the language of the “program”
letters contributed to her belief that she was taking a legitimate avenue to dispute these two debts.
The debt in SOR Subparagraph 1.a was cancelled by the creditor during the 2006 tax year, and
Applicant paid income tax on the amount cancelled.  The use of this “program” was a one-time
occurrence by Applicant on only two debts.  She has not repeated the use of that “program.”  It is
not likely she will use it again, based on her testimony.  I do not believe she poses a trustworthiness
concern or that similar conduct will recur in the future.
Therefore, I conclude the financial considerations trustworthiness concern for Applicant.
Likewise, I conclude the personal conduct and criminal conduct trustworthiness concerns for
Applicant.  Finally, I conclude the “whole person” concept for Applicant.
FORMAL FINDINGS
The following are my conclusions as to each allegation in the SOR:
Paragraph 1.  Guideline F: FOR APPLICANT
Subparagraph 1.a: For Applicant
Subparagraph 1.b: For Applicant
Paragraph 2.  Guideline E: FOR APPLICANT
Subparagraph 2.a: For Applicant
Paragraph 3.  Guideline J: FOR APPLICANT
Subparagraph 3.a: For Applicant
DECISION
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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 a public trust position is granted.
Philip S. Howe
Administrative Judge