DATE: October 23, 2007
In re:
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SSN: ---------------
Applicant for Security Clearance
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ISCR Case No. 07-01847
DECISION OF ADMINISTRATIVE JUDGE
MARTIN H. MOGUL
APPEARANCES
FOR GOVERNMENT
Jeff Nagel, Esq., Department Counsel
FOR APPLICANT
Pro Se
SYNOPSIS
Applicant has had a history of financial difficulties. He has paid off or is paying the majority
of his debts, and he has a plan to resolve any remaining overdue debt, that is not in dispute. His
financial situation is stable and current. Mitigation has been shown. Clearance is granted.
STATEMENT OF THE CASE
On May 2, 2007, the Defense Office of Hearings and Appeals (DOHA), pursuant to
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Executive Order 10865 and Department of Defense Directive 5220.6 (Directive), dated January 2,
1992, issued a Statement of Reasons (SOR) to Applicant which detailed reasons why DOHA could
not make the preliminary affirmative finding under the Directive that it is clearly consistent with the
national interest to grant or continue a security clearance for Applicant and recommended referral
to an Administrative Judge to determine whether clearance should be denied or revoked.
In a signed and sworn statement, dated May 15, 2007, Applicant responded in writing to the
SOR allegations (RSOR), and he requested a clearance decision based on a hearing record.
The case was assigned to this Administrative Judge on June 29, 2007. A Notice of Hearing
was issued to the parties on August 20, 2007, and the hearing was held in Fairbanks, Alaska, on
September 25, 2007. 
At the hearing, Department Counsel offered seven documentary exhibits (Exhibits 1-7) and
no witnesses were called. Applicant submitted five documentary exhibits (Exhibits A through E) and
offered his own testimony. All documentary evidence was entered into evidence without objection.
The record was left open until October 5, 2007, to allow Applicant to introduce additional evidence
of proof of payment of past overdue debts. Applicant timely offered into evidence a cover letter and
additional documents. Department Counsel indicated that he had no objection to these additional
proffered documents; these documents are entered into evidence as Applicant’s Exhibit F. The
transcript (Tr) was received on October 10, 2007. 
FINDINGS OF FACT
In the SOR, the Government alleges that a security risk may exist under Adjudicative
Guideline F (Financial Considerations) of the Directive. The SOR contains 21 allegations, 1.a.
through 1.u., under Guideline F. In his Response to the SOR (RSOR), Applicant admitted SOR
allegations 1.d., 1.e., 1.h., 1.i., 1.j., 1.k., 1.l., 1.n.,1.o., 1.p., 1.t., and 1.u., and he denied the other
allegations. The admitted allegations are incorporated herein as findings of fact.
 
After a complete and thorough review of the evidence in the record, including Applicant's
Answer to the SOR, the admitted documents, and the live testimony and upon due consideration of
that evidence, I make the following additional findings of fact: 
Applicant is 41 years old. He is currently unmarried, and he has one 16 year old son.
Applicant is employed as an Operations Manager by a defense contractor, and he seeks to retain a
DoD security clearance in connection with his employment in the defense sector. 
The SOR lists 20 debts that Applicant allegedly owed as of either February 26, 2007, or April
18, 2007, 1.a. through 1.t., under Adjudicative Guideline F.  The debts will be discussed in the order
that they were listed in the SOR: 
1.a. This overdue debt to Creditor 1 is listed in the SOR in the amount of $84. Applicant
testified that this debt has been paid. Exhibit 7, a credit report from Equifax, dated September 20,
2007, shows that this debt has been paid. 
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1.b. This overdue debt to Creditor 2 is listed in the SOR in the amount of $4,321. This
medical debt arose because Applicant had wrist surgery, and he had difficulty having the insurance
company pay the 80% that he believes it was required to pay. Applicant testified that this debt has
now been reduced to $866, because the insurance company has now paid its share. He has now
formulated a payment plan with the collection agency, and is scheduled to pay $555.26 a month for
this debt and several others. Exhibit C shows that he has made two payments thus far. The other
debts that this payment covers will be discussed as the additional debts are reviewed. 
1.c. This overdue debt to Creditor 3 is listed in the SOR in the amount of $4,409. Applicant
believes that this is the same debt as that listed in 1.b., above. Exhibit 7, the most current credit
report, does not list two separate debts in the amounts of 1.b. and 1.c. I cannot find that1.b. and 1.c.
are two different debts. 
1.d. This overdue debt to Creditor 4 is listed in the SOR in the amount of $342. Applicant
testified that at this time he still owes this debt, but he is planning to resolve this debt by the end of
the year. 
1.e. This overdue debt to Creditor 5 is listed in the SOR in the amount of $1,235. Applicant
testified that this debt is part of a slip and fall personal injury claim that he has filed. Exhibit A
includes a letter from attorneys who are representing Applicant in this law suit. Applicant plans to
take the proceeds from this lawsuit if it is resolved favorably to pay this debt and some additional
debts. 
1.f. This overdue debt to Creditor 6 is listed in the SOR in the amount of $1,468. Applicant
testified that this medical bill was also never paid by his insurance company. It has been resubmitted
to the insurance company, and he anticipates that 80% of the debt will be paid by the insurance
company. After the hearing Applicant submitted Exhibit F and offered that the insurance company
has now paid $1,174.54, reducing the debt still owed to $293.64.This debt is also one that is being
reduced by his monthly payment of $555.26, as discussed in 1.b., above. 
1.g. This overdue debt to Creditor 7 is listed in the SOR in the amount of $1,112. This bill
for an apartment lease has now been resolved. Exhibit B includes a letter from the attorneys who
represented the creditor on this claim, which shows that this debt has been paid in full. 
1.h. This overdue debt to Creditor 8 is listed in the SOR in the amount of $325. This is an
additional debt that is being reduced by Applicant’s  monthly payment of $555.26, as discussed in
1.b., above. 
1.i. This overdue debt to Creditor 9 is listed in the SOR in the amount of $731. This hospital
bill is also part of Applicant’s slip and fall case, as is 1.g., above. 
1.j. This overdue debt to Creditor 10 is listed in the SOR in the amount of $84. Applicant
testified that at this time he still owes this debt, but he is planning to resolve this debt by the end of
the year. 
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1.k. This overdue debt to Creditor 11 is listed in the SOR in the amount of $54. Applicant
testified that he has disputed this debt, because he is not aware of its origin, and he has been
informed that it will be removed from his subsequent credit reports. 
1.l. This overdue debt to Creditor 12 is listed in the SOR in the amount of $159. Applicant
testified that at this time he still owes this debt, but he is planning to resolve this debt by the end of
the year. 
1.m. This overdue debt to Creditor 13 is listed in the SOR in the amount of $11. Applicant
believers that he paid this bill in 1999 to a hospital, and it is not on his most current credit report.
1.n. This overdue debt to Creditor 14 is listed in the SOR in the amount of $365. Applicant
testified that he has no information to dispute that he owes this bill to a cable company, and he plans
to pay the debt after he confirms that the bill is correct. 
1.o. This overdue debt to Creditor 15 is listed in the SOR in the amount of $46. Applicant
contacted the credit reporting agencies, but he has been unable to ascertain the origin of this bill.
Department Counsel confirmed that this debt which arose in 2004 is no longer listed on the latest
credit report so it must be resolved since the debt is too recent to have been dropped off the credit
report after seven years. 
1.p. This overdue debt to Creditor 16 is listed in the SOR in the amount of $891. Applicant
testified that he paid $930 to resolve this debt, by fax on July 18, 2007. 
1.q. This overdue debt to Creditor 17 is listed in the SOR in the amount of $862. Applicant
averred that this debt is the same as 1.p., above, and it has been resolved, as discussed above. 
1.r. This overdue debt to Creditor 18 is listed in the SOR in the amount of $854. Applicant
testified that at this time he still owes this debt, but he is planning to resolve this debt by the end of
the year. 
1.s. This overdue debt to Creditor 19 is listed in the SOR in the amount of $615. Applicant
testified that this debt is for a university course that he took. He stated that he attempted to have the
college reduce the debt, since he only attended three class sessions before he was forced to go in the
hospital and drop the class, but they refused. He testified that he would pay off this debt, but it would
be the last one he resolved.  
1.t. This overdue debt to Creditor 20 is listed in the SOR in the amount of $35. Applicant
testified that when he requested from the credit reporting agency background as to the origin of this
debt, it was dropped from his credit report. The latest credit report does not list this debt. 
1.u. Applicant prepared a Personal Financial Statement on March 13, 2007, (Exhibit 5) which
indicates he has a monthly net remainder of $2,257, after expenses. The Government alleges that he
should have been able to resolve more of his debts.  Applicant testified that this Personal Financial
Statement does not reflect the money that he has been paying for back taxes and $12,500 advance
that he received from his current employer to pay off additional debts. Applicant estimated that 90%
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of his income, that does not go to supporting his son or him, goes to paying off his debts. He testified
that he has had additional debts that have not been listed on the SOR, including a debt of $1,800 that
he borrowed from a friend, and he has been paying these off as well. 
Applicant testified that as a resident of Alaska he will be receiving a dividend of $1,654 at
the end of 2007, and he is planning to use that to resolve as many additional debts as he can. 
Applicant  remains current on all his recent debts, including his two credit cards, and he has
demonstrated a stable and mature outlook about his finances.
Applicant submitted a character letter from his current supervisor (Exhibit A). He spoke
extremely highly of Applicant, talking about him being as an excellent worker and more significantly
about him working diligently to resolve his overdue debts, which occurred because of medical bills
and because of the move of Applicant and his son from Wisconsin to Fairbanks, Alaska to obtain
his current employment.
POLICIES
Enclosure 2 of the Directive sets forth adjudicative guidelines that must be carefully
considered in evaluating an individual's security eligibility and making the overall common sense
determination required. The Administrative Judge must take into account the conditions raising or
mitigating security concerns in each area applicable to the facts and circumstances presented.
Although the presence or absence of a particular condition for or against clearance is not
determinative, the specific adjudicative guidelines should be followed whenever a case can be
measured against this policy guidance, as the guidelines reflect consideration of those factors of
seriousness, recency, motivation, etc. 
The adjudication process is based on the whole person concept. All available, reliable
information about the person, past and present, is to be taken into account in reaching a decision as
to whether a person is an acceptable security risk.
Each adjudicative decision must also include an assessment of: (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). 
BURDEN OF PROOF
            Initially, the Government must prove controverted facts alleged in the Statement of Reasons.
If the Government meets that burden, the burden of persuasion then shifts to Applicant to establish
his security suitability through evidence of refutation, extenuation or mitigation sufficient to
demonstrate that, despite the existence of disqualifying conduct, it is nevertheless clearly consistent
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with the national interest to grant or continue the security clearance. Assessment of Applicant's
fitness for access to classified information requires evaluation of the whole person, and consideration
of such factors as the recency and frequency of the disqualifying conduct, the likelihood of
recurrence, and evidence of rehabilitation.
A person who seeks access to classified information enters into a fiduciary relationship with
the U.S. Government that is predicated upon trust and confidence. Where facts proven by the
Government raise doubts about Applicant's judgment, reliability, or trustworthiness, Applicant has
a heavy burden of persuasion to demonstrate that he or she is nonetheless security worthy. As noted
by the United States Supreme Court in Department of the Navy v. Egan, 484 U.S. 518, 531 (1988),
"the clearly consistent standard indicates that security-clearance determinations should err, if they
must, on the side of denials."
CONCLUSIONS
It is the Government's responsibility to present substantial evidence to support the finding
of a nexus, or rational connection, between the Applicant's conduct and the continued holding of a
security clearance. If such a case has been established, the burden then shifts to the Applicant to go
forward with evidence in rebuttal, explanation or mitigation which is sufficient to overcome or
outweigh the Government's case. The Applicant bears the ultimate burden of persuasion in proving
that it is clearly consistent with the national interest to grant him a security clearance. This the
Applicant has done.
Having considered the evidence of record in light of the appropriate legal precepts and
factors, I conclude the following with respect to Guidelines F: 
The Government has established its initial case under Guideline F. The record evidence
proves Applicant's history of indebtedness. However, there is evidence that Applicant is attempting
to resolve these overdue debts.
Regarding the Disqualifying Conditions (DC) under Guideline F in the Adjudicative
Guidelines, I conclude DC 19 (a) applies because of Appellant’s “history of not meeting financial
obligations.”
In considering the Mitigating Conditions (MC) I find that MC 20. (b) applies because the
conditions that resulted in the financial problem of Applicant  were largely beyond his control, (in
this case medical emergencies, loss of employment, and the cost of moving to obtain new
employment), and Applicant has acted responsibly under the circumstances. MC 20. (e) also applies,
as Applicant has initiated a good-faith effort to repay the creditors.   I, therefore, hold Guideline F
for Applicant. 
FORMAL FINDINGS
Formal Findings as required by Section E3.1.25 of Enclosure 3 of the  Directive are hereby
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rendered as follows:
Financial Considerations,  Guideline F: For 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.: For Applicant
Subparagraph 1.j.: For Applicant
Subparagraph 1.k.: For Applicant
Subparagraph 1.l.: For Applicant
Subparagraph 1.m.: For Applicant
Subparagraph 1.n.: For Applicant
Subparagraph 1.o.: For Applicant
Subparagraph 1.p.: For Applicant
Subparagraph 1.q.: For Applicant
Subparagraph 1.r.: For Applicant
Subparagraph 1.s.: For Applicant
Subparagraph 1.t.: For Applicant
Subparagraph 1.u.: For Applicant
DECISION
In light of all the circumstances and facts presented by the record in this case, it is clearly
consistent with the national interest to grant or continue a security clearance for Applicant.
Martin H. Mogul
Administrative Judge