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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
------------------------ )       ISCR Case No. 07-05144
SSN: ---------------- )
)
Applicant for Security Clearance )
Appearances
For Government: Fahryn Hoffman, Esquire, Department Counsel
For Applicant: Pro Se
______________
Decision
______________
MATCHINSKI, Elizabeth M., Administrative Judge:
Applicant submitted his security clearance application (e-QIP) on October 19,
2006. On July 25, 2007, the Defense Office of Hearings and Appeals (DOHA) issued a
Statement of Reasons (SOR) detailing the security concerns under Guideline F,
Guideline E, and Guideline J for Applicant. The action was taken under Executive Order
10865, Safeguarding Classified Information within Industry (February 20, 1960), as
amended; Department of Defense Directive 5220.6, Defense Industrial Personnel
Security Clearance Review Program (January 2, 1992), as amended (Directive), and the
revised adjudicative guidelines (AG) promulgated by the President on December 29,
2005, and effective within the Department of Defense for SORs issued after September
1, 2006. 
 
Applicant acknowledged receipt of the SOR on August 9, 2007. He answered the
SOR in writing on September 21, 2007, and requested a decision based on the record
without a hearing. On October 30, 2007, Applicant requested a hearing before an
Administrative Judge. Department Counsel was prepared to proceed on November 19,
2007. On November 21, 2007, I scheduled a hearing for December 12, 2007.
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I convened the hearing on December 12, 2007, as scheduled. Three
Government exhibits (Ex. 1-3) and six Applicant exhibits (A-F) were received into
evidence without objection and Applicant testified, as reflected in a hearing transcript
(Tr.) received by DOHA on December 21, 2007. I granted Applicant’s request to keep
the record open until January 2, 2008, to submit additional documents. Applicant
forwarded by facsimile proposed exhibit G on December 14, 2007, exhibits H-K on
December 18, 2007, and exhibit L on December 20, 2007. In corresponding email
messages, Applicant explained his efforts to contact his creditors. A record of his email
correspondence with DOHA was marked as exhibit M. On January 3, 2008, I gave the
Government until January 11, 2008, to respond. Department Counsel indicated on
January 11, 2008, that the Government had no objections, and the exhibits were
received in evidence. Based upon a review of the case file, pleadings, exhibits, and
testimony, eligibility for access to classified information is denied.
Findings of Fact
DOHA alleged under Guideline F, Financial Considerations, that as of May 14,
2007, Applicant owed delinquent debts of $6,543 (SOR ¶ 1.a), $4,128 (SOR ¶ 1.b),
$2,807 (SOR ¶ 1.c), $3,774.75 (SOR ¶ 1.d), and $161 (SOR ¶ 1.e). Under Guideline E,
Personal Conduct, Applicant was alleged to have deliberately falsified his October 2006
e-QIP by denying he had been over 180 days delinquent on any debts within the seven
years preceding his clearance application (SOR ¶ 2.a), or that he was currently over 90
days delinquent on any debts (SOR ¶ 2.b). DOHA also alleged under Guideline J,
Criminal Conduct, that Applicant committed a felony violation of 18 U.S.C. § 1001 by
falsifying his response to the debt inquiries on his e-QIP (SOR ¶ 3.a). In his Answer to
the SOR, Applicant denied the allegations with explanations. After consideration of the
evidence of record, I make the following findings of fact.
Applicant is a 44-year-old production manager who has worked for his current
employer, a small defense contractor, since March 2005. He seeks a secret-level
security clearance for overseas duties involving power systems for defense
applications.  He held an interim clearance, which was withdrawn on issuance of the
SOR.
Applicant married his first wife in September 1981. During their four-year
marriage, they had three children who are now young adults and live on their own.  In
November 1992, Applicant married his current spouse. They have a 17-year-old son
who lives with them.
Applicant served in the United States Air Force from April 1982 to March 1988.
He held a secret clearance while he was in the military. In August 1988, he began
working as a test engineer and technician in the semiconductor industry with company
X. His financial obligations, including his mortgage, were paid on time. He and his
spouse took out automobile loans for $17,364 in November 1995, and for $32,898 in
March 1997. Both were paid off according to terms. (Ex. 3)
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In June 1997, he continued in the same line of work but with a new employer. In
September 1999, Applicant and his spouse bought a boat for waterskiing, taking out a
loan of $23,367 to be repaid at $265 monthly for 180 months. As of July 2001, the loan
was rated as current. (Ex. 3, Tr. 97)
In August 2000, Applicant returned to work for company X. (Ex. 1) In March
2001, he and his spouse took out a loan for $75,000 to remodel their home. (Ex. 3, Tr.
95) By 2002 they had problems meeting some of their financial obligations. An individual
revolving charge account opened by Applicant in June 2002 was closed in February
2003 with a balance owed of $4,128 (SOR ¶ 1.b). A MasterCard account Applicant had
opened in October 2002 was $5,392 past due as of May 2003 (SOR ¶ 1.d). As of
November 2002, Applicant had a past due balance of $178 on another credit card (not
alleged). The debt was settled in March 2005 for less than the $445.29 owed at the
time. In December 2002, a VISA card account on which Applicant was an authorized
user was charged off in the amount of $6,543 and placed for collection (SOR ¶ 1.a).
Applicant had his own MasterCard account with the same lender, which was settled for
less than the full $5,237 balance in July 2003 (not alleged). As of March 2003, he and
his spouse were 60 days past due ($2,552 in arrears) in their mortgage payment. In
May 2003, Applicant’s account with a wholesale retail club, opened in December 1998,
was charged off in the amount of $2,807 (SOR ¶ 1.c). In December 2003, a $161
medical debt was referred for collection (SOR ¶ 1.e). (Ex. 2, Ex. 3)
Applicant and his spouse sought the services of a debt resolution firm in 2002.
While they were able to take care of only a few of their debts (“we weren’t able to keep
up with the program at that point, just because of other reasons, other things that
happened and that kind of came along.” Tr. 65), the phone calls from creditors stopped
(Tr. 36).
In 2004, Applicant and his spouse purchased a week in a timeshare, about 2 1/2
hours from their home at the time. Applicant, who traveled there for outdoor activities,
stayed in a unit for $35 per night when one was available. It was less expensive than a
hotel in the area. (Tr. 99) 
In Fall 2004, Applicant’s spouse, who worked for the same company as
Applicant, left her job and moved to their present locale.  (Tr. 67, 105) Applicant worked
a shift that allowed him to spend the weekends with his wife and son. (Tr. 67) He was
earning between $50,000 and $55,000 annually depending on overtime hours. In
December 2004, Applicant got a part-time job as a lift attendant at an alpine ski resort at
$7.50 per hour. They sold their home in their previous locale that same month, satisfied
their mortgage, and paid off the loan taken out to remodel the premises. In January
2005, Applicant was laid off from his job in the semiconductor industry. His spouse was
still unemployed. Applicant worked full-time as a lift attendant to support the family until
late March 2005. (Tr. 65-69)
In late March 2005, Applicant began working as a shop manager for his present
employer, a small power systems company of 15 employees. His spouse began
Applicant testified that the company had reduced in size from fifteen to nine employees. (Tr. 102)1
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working there as well in June 2005, as an administrative assistant at about $11 an hour.
(Tr. 69, 106) 
In January 2006, a retailer placed Applicant’s delinquent account with a balance
of $4,128 for collection (SOR ¶ 1.b). In April 2006, Applicant and his spouse leased a
four-wheel-drive vehicle for her at a cost of $585 per month for 36 months. 
On October 13, 2006, Applicant submitted his e-QIP seeking a secret-level
clearance. Due to a technical problem, Applicant had to re-sign the document on
October 19, 2006. (Tr. 62-63) Applicant responded negatively to financial delinquency
inquiries: 28 a. “In the last 7 years, have you been over 180 days delinquent on any
debt(s)?” and 28 b. “Are you currently over 90 days delinquent on any debt(s)?”. (Ex. 1)
A check of Applicant’s credit on November 8, 2006, revealed a history of late
payments on some accounts brought current, such as his boat loan, which had a
balance of $17,661. Several accounts were listed as charged off and/or placed for
collection (SOR ¶¶ 1.a as authorized user, 1.b, 1.c, 1.d and 1.e). (Ex. 3)
In about December 2006, Applicant listed the timeshare for sale. As of December
2007, it was still on the market. (Tr. 99-100, Ex. J) Applicant and his spouse continued
to pay $100 per month for the timeshare. (Ex. J)
On January 11, 2007, Applicant was interviewed for his security clearance. He
expressed a willingness to resolve his indebtedness. (Ex. 2) In January 2007, Applicant
and his spouse looked into buying a home. They were told they would qualify for a loan
but at a higher interest rate due their credit problems. The decided not to pursue home
ownership at that time due to their employer’s economic outlook.  (Tr. 86) Applicant1
obtained his own credit report on January 18, 2007, to confirm his debt (Tr. 37). He and
his spouse decided to address their outstanding accounts one at a time. (Tr. 36-37) His
spouse continued to handle the family’s finances as she had since their marriage, but
Applicant took a more active role. (Tr. 85)
On April 20, 2007, the creditor owed the debt in SOR ¶ 1.d agreed to settle the
$5,392.50 balance for $3,774.72. The debt was to be repaid at $314.56 per month from
May 2007 through April 2008 in return for waiving late fees and finance charges. (Ex. 2)
After an initial payment of $331 in May, he made payments of $350 in June, $400 each
in July, August, and September, and $320 in October, reducing the balance  to about
$1,573.72. (Ex. D, Ex. I, Ex. L) On or before June 1, 2007, Applicant paid the $161.10
medical debt in collection (SOR ¶ 1.e). (Ex. E)
In response to interrogatories from DOHA, Applicant indicated on May 14, 2007,
that he had reached a settlement agreement with the creditor owed the debt in SOR ¶
1.d. Once that debt had been satisfied, he would deal with his other consumer credit
debts in succession (in order ¶1.c, 1.b, and 1.a). He maintained he had not known of
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the medical debt in collection (SOR ¶ 1.e) before he saw his credit report, and promised
to take care of that debt within 30 days. As for his failure to disclose his debts on his e-
QIP, Applicant explained, “I thought that these debts had been released because the
companies had them listed as ‘charge offs’ on my credit report.” Applicant also
furnished a personal financial statement indicating that he and his spouse had
$1,398.44 remaining each month after payment of expenses and debts, including $585
for his spouse’s car, $266 for their boat, $314.56 on the debt in SOR ¶ 1.d, $100 for the
timeshare, and $15 on his spouse’s credit card. He estimated he owed $17,400 for the
boat, $433 on her credit card, $3,774.75 on the delinquent debt in ¶ 1.d, and $3,552.30
for the timeshare. (Ex. 2)
In June 2007, Applicant and his family vacationed in California. He believes they
financed the trip with savings, although he isn’t sure. (Tr. 89)
After Applicant received the SOR, he consulted with an attorney who advised him
to contact his creditors and attempt to arrange repayment terms. (Tr. 37) In or before
August 2007, Applicant contacted the assignee collecting the $4,128 retail charge
delinquency (SOR ¶ 1.b). The collection agency agreed to accept in settlement
$2,477.14, payable in three installments ($400, which was paid by Applicant on August
24, 2007, $301.26 which was paid by him on October 2, 2007, followed by a balloon
payment of $1,775.88 due October 31, 2007). (Ex. B, Ex. L) Applicant informed the
collection agency that he could not afford the balloon payment. (Tr. 49) On November
28, 2007, he paid an additional $107.26. As of December 2007, he had not called the
creditor to negotiate additional payments. (Tr. 50-51) 
Applicant contacted the creditors reportedly owed the debts in SOR ¶¶ 1.a and
1.c. On or before September 17, 2007, the creditor removed the reported delinquency
on the account in ¶ 1.a from Applicant’s credit record. (Ex. A) Applicant understood from
talking to the creditor that the reported balance had been paid and was no longer his
responsibility. (Tr. 45-46) Applicant was informed by the presumed creditor of the debt
in SOR ¶ 1.c that his account had been sold in 2004. Applicant was unsuccessful in
setting up a payment plan with the named assignee as the company had no record of
the debt. (Ex. C, Tr. 30)
As of December 2007, Applicant’s hourly rate was $17.71, and his spouse’s was
$12.08. (Ex. K) Based on average overtime earnings, Applicant estimated a net monthly
household remainder of $874.18, after payment of expenses and debts (including his
payments on SOR ¶¶ 1.b and 1.d). (Ex. J) Applicant and his spouse each have one low
limit credit card account for emergencies. Applicant’s credit card balance was about
$300. (Tr. 73-74) Applicant owes about $16,500 on his boat loan. (Tr. 88) He listed the
boat for sale in Fall 2007. (Tr. 100) After paying $500 in legal expenses for assistance in
drafting his Answer, and $1,650 in dental expenses for their son, Applicant and his
spouse have about $500 in savings. (Tr. 83-84)
At his hearing, Applicant attributed his failure to report any delinquent debts on
his e-QIP to his belief that his old debts were more than seven years in the past. (Tr. 37)
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He cited his ability to lease vehicles and no calls from creditors as factors that led him to
assume there were no credit issues. (Tr. 37-38, 64)
  
Applicant has excelled in his position as production manager at his employer’s
manufacturing facility. Under his direction, the quality of the company’s finished product
has improved significantly with less delivery lead time required. After his interim
clearance was granted, Applicant made several trips overseas to provide support to the
U.S. military in theater. Applicant is held in high regard by those whom he supported
and by his employer. He and his wife have access to confidential company accounting
information and have not violated that trust. (Ex. F)
Policies
When evaluating an Applicant’s suitability for a security clearance, the
Administrative Judge must consider the revised adjudicative guidelines (AG). In addition
to brief introductory explanations for each guideline, the adjudicative guidelines list
potentially disqualifying conditions and mitigating conditions, which are useful in
evaluating an Applicant’s eligibility for access to classified information.
These guidelines are not inflexible rules of law. Instead, recognizing the
complexities of human behavior, these guidelines are applied in conjunction with the
factors listed in the adjudicative process. The Administrative Judge’s over-arching
adjudicative goal is a fair, impartial and common sense decision. According to AG ¶
2(c), the entire process is a conscientious scrutiny of a number of variables known as
the “whole person concept.” The Administrative Judge must consider all available,
reliable information about the person, past and present, favorable and unfavorable, in
making a decision.
The protection of the national security is the paramount consideration. AG ¶ 2(b)
requires that “[a]ny doubt concerning personnel being considered for access to
classified information will be resolved in favor of national security.” In reaching this
decision, I have drawn only those conclusions that are reasonable, logical and based on
the evidence contained in the record. Likewise, I have avoided drawing inferences
grounded on mere speculation or conjecture.
Under Directive ¶ E3.1.14, the Government must present evidence to establish
controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, the Applicant is
responsible for presenting “witnesses and other evidence to rebut, explain, extenuate,
or mitigate facts admitted by applicant or proven by Department Counsel. . . .” The
Applicant has the ultimate burden of persuasion as to obtaining a favorable security
decision. 
A person who seeks access to classified information enters into a fiduciary
relationship with the Government predicated upon trust and confidence. This
relationship transcends normal duty hours and endures throughout off-duty hours. The
Government reposes a high degree of trust and confidence in individuals to whom it
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grants access to classified information. Decisions include, by necessity, consideration of
the possible risk the Applicant may deliberately or inadvertently fail to protect or
safeguard classified information. Such decisions entail a certain degree of legally
permissible extrapolation as to potential, rather than actual, risk of compromise of
classified information.
 
Section 7 of Executive Order 10865 provides that 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.” See also EO 12968, Section 3.1(b) (listing multiple prerequisites
for access to classified or sensitive information).  
Analysis
Guideline F, Financial Considerations
The security concern relating to the guideline for Financial Considerations is set
out in AG & 18:
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. 
Applicant and his spouse did not spend wisely and incurred obligations beyond
what they could reasonably afford on their incomes. (Tr. 71, Ex. 3) An awareness of
their financial situation led them to seek debt resolution in about 2002, and a delinquent
credit card debt of $5,237 was settled in July 2003 for less than the full balance.
However, as of late 2003, Applicant owed delinquent debt of about $12,500 (SOR ¶¶
1.b, 1.c, 1.d, 1.e).  Rather than address these delinquent debts, he and his spouse
purchased a timeshare in 2004. Security concerns are raised by “inability or
unwillingness to satisfy debts” (AG ¶ 19(a)), by “indebtedness caused by frivolous or
irresponsible spending and the absence of any evidence of willingness or intent to pay
the debt or establish a realistic plan to pay the debt” (AG ¶ 19(b), and by “a history of
not meeting financial obligations” (AG ¶ 19(c)).
An additional credit card delinquency of $6,543 (SOR ¶ 1.a) was reported on
Applicant’s credit record as of November 2006 (Ex. 3), although Applicant was only an
authorized user on the VISA account. So while an authorized user can be held legally
responsible for its repayment, the evidence is inconclusive about who incurred the
charges and/or opened the account. The creditor removed the debt from Applicant’s
credit report in September 2007. (Ex. A) The Government did not sufficiently establish
that Applicant faces the additional financial pressures of having to repay the $6,543
alleged in SOR ¶ 1.a.
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Applicant’s indebtedness predates his job layoff in December 2004 as well as his
spouse’s unemployment. AG ¶ 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”) applies only to his failure to
address his debts in the short-term. Concerned about their financial situation back in
2002, Applicant and his spouse consulted with a debt resolution firm. Applicant knew
that they had been unable to follow through on their planned repayments, due largely to
the job layoff and his spouse’s unemployment. Yet, once they were both gainfully
employed in June 2005, Applicant took no action to ensure that his delinquent
obligations were repaid. It is no excuse that his spouse handled the family’s finances.
In mitigation of this demonstrated financial irresponsibility, Applicant has taken
recent steps toward resolving his debt that implicate AG ¶ 20(d) (“the individual initiated
a good-faith effort to repay overdue creditors or otherwise resolve debts”). Prompted by
a desire to improve his credit so that he and his spouse might obtain a home mortgage
under favorable terms in the future, Applicant started repaying the debt in SOR ¶ 1.d in
May 2007. Financial records in evidence confirm Applicant has been making monthly
payments in excess of the $314.56 required under the settlement agreement. While the
debt will not be completely satisfied until April 2008, he has demonstrated a track record
of timely payments to conclude he is likely to pay off the debt as scheduled. As he
promised in May 2007, he paid the $161 medical debt in collection (SOR ¶ 1.e) within
30 days. He has made three payments totaling $808.52 on the debt in SOR ¶ 1.b.  His
failure to make any payments toward his debt in SOR ¶ 1.c is attributed to difficulty
determining where any payments should be sent. The original creditor sold the account
and the named assignee claims to have no record of the debt.
Assuming the creditor collecting the debt in SOR ¶ 1.b does not cancel the
settlement agreement because of Applicant’s failure to make the $1,774 balloon
payment, Applicant owes about $6,000 in delinquent debt. This is not an
insurmountable burden since he and his spouse are both employed and have a positive
cash flow. However, given Applicant’s past discretionary spending for a boat and
timeshare, there must be adequate assurance that Applicant will not incur new
obligations that will further stress his finances. In April 2006, he entered into a vehicle
lease taking on a monthly repayment obligation of $585 for 36 months. Their need for a
reliable four-wheel-drive vehicle is not disputed, and they have been current in their
payments. Spending their savings on a vacation to California in June 2007 when they
owed several creditors is more difficult to justify. On the other hand, Applicant testified
that he and his spouse “are a little bit smarter than what [they] were a few years ago.”
They have significantly reduced their use of consumer credit. Both he and his spouse
have a low-limit credit card for emergencies. (Tr. 73-74) There is no evidence of any
new credit card delinquency, or of late rent or utility payments. They have made their
timeshare and boat payments on time since they have worked for the defense
contractor. Even if they are not successful in selling either of these assets, their financial
situation has sufficiently stabilized to allow them to continue to meet their current
obligations and to make payments on the old delinquencies. AG ¶ 20(d) and AG ¶ 20(c)
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(“there are clear indications that the problem is being resolved or is under control”)
apply.
Guideline E, Personal Conduct
The security concern related to the guideline for Personal Conduct is set out in
AG ¶ 15:
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.
As of October 2006, when Applicant applied for a secret-level clearance, he
owed  on accounts that had been charged off and/or placed for collection in 2003
($4,128 on  ¶ 1.b, $2,807 on ¶ 1.c, $5,392 on ¶ 1.d, and $161 on ¶ 1.e). These debts
should have been reported in response to the financial delinquency inquiries pertinent to
debts over 180 days within the past seven years (section 28.a) and to debts currently
over 90 days delinquent (section 28.b).  Applicant instead responded “No” to both
questions. 
Under AG ¶ 16(a) personal conduct concerns are raised by the “deliberate
omission, concealment, or falsification of relevant facts from any personnel security
questionnaire, personal history statement, or similar form used to conduct
investigations, determine employment qualifications, award benefits or status,
determine security clearance eligibility or trustworthiness, or award fiduciary
responsibilities.” Applicant does not contest that he answered “No” to the debt inquiries,
but submits he did not intentionally falsify his e-QIP. In response to DOHA
interrogatories in May 2007, Applicant explained, “I thought that these debts had been
released because the companies had them listed as ‘charge offs’ on my credit report.”
(Ex. 2) At his hearing, Applicant testified that he thought the debts were more than
seven years in the past. His spouse handled the finances, he did not see his credit
report until January 2007, he was not receiving any calls from creditors, and he had
been able to lease his spouse’s vehicle in that time frame (i.e., April 2006):
Like I said, we had been able to lease cars and, from what I was told, your
credit has to be decent enough to lease a car, so I did not realize we had
any credit issues until we started looking into buying a home in January of
this year, and that’s when we saw our first credit report for a while and
that’s when we started working on these debts . . .  I’ve been through a
security clearance check before when I was in the Service and I’m not
naive enough to think they are not going to go back and check my history,
check my credit history, so I didn’t knowingly falsify these. . . . 
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(See Tr. 36-38)
Although Applicant’s debts were long delinquent when he completed his security
clearance application, the record evidence does not support a good-faith belief that they
were more than seven years in the past. First, there is the discrepancy between his
explanation of May 2007, where he attributed the omission to the creditors reporting the
debts as charge offs on his credit record, and his testimony that he did not see his credit
report until January 2007, which would have been after he completed his SF 86.  When
confronted with the discrepancy, Applicant testified with respect to his May 2007
explanation, “I don’t know why I did that, probably, just because I had based it on seeing
the credit report instead of, I don’t know.” (Tr. 60) In the interrogatories, DOHA quoted
the language of the e-QIP financial delinquency inquiries. It stands to reason that had
Applicant thought his debts were more than seven years in the past, he would have said
so.
Moreover, Applicant knew that he had financial problems as recently as 2002,
when he and his spouse sought the assistance of a debt resolution firm:
Q You indicated that you and your wife had; consulted a debt reduction--
A Yes.
Q –company? When was that?
A I knew you were going to ask that so I tried to remember it. It was in
2002.
Q So you knew in 2002 that you had delinquent debts?
A Yes, at that time I did, but I did not realize, I didn’t remember it was
actually 2002, I thought it was further back than 2002 that we had entered
into that agreement.
Q So you thought it was prior to 1999?
A Yes.
Q And what were the results of that relationship with that debt reduction
company?
A We were able to take care of a few debts, obviously not all of them, and
we weren’t able to keep up with the program at that point, just because of
other reasons, other things that happened and that kind of came along.
Q Well, such as?
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A I was laid off from my job in 2004, yeah, 2004 and--
Q And--
A –we just weren’t able to keep up with it. We thought we were going to be
able to, we made a good attempt at trying to keep up with it at that point
but we just couldn’t.
Q So you stayed in the program for about two years?
A Yes.
Q Do you remember what month you were laid off in ‘04?
A I believe it was December ‘04.
(Tr. 65-66) It is simply not credible for Applicant to claim that he thought they had
entered into the debt resolution agreement before 1999, given his admission to staying
in the program for two years, and not being able to keep up because of his job loss in
December 2004. Applicant admitted knowing they had been unable to repay all of their
debts as recently as December 2004, which was well within the seven-year scope of
question 28 a. Applicant has not persuaded me that the omission of his debts was due
to good faith mistake, to inability to recall, or some other cause that would negate the
reasonable inference of knowing and willful concealment. Security concerns are raised
under AG ¶ 16(a).
Concerns as to whether Applicant has been fully candid about his e-QIP
omissions preclude me from considering AG ¶ 17(a) (“the individual made prompt,
good-faith efforts to correct the omission, concealment, or falsification before being
confronted with the facts”), even though Applicant is credited with acknowledging  the
debts when he responded to the interrogatories or at his hearing. None of the other
potentially mitigating conditions apply.
Guideline J, Criminal Conduct
The security concern related to the guideline for Criminal Conduct is set out in
AG ¶ 30:
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.
When Applicant signed his security clearance application in October 2006, he
certified that his statements on the form and any attachments were “true, complete and
correct to the best of [his] knowledge and belief and [were] made in good faith,” and that
he understood that a knowing and willful false statement could be punished by a fine or
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imprisonment or both. By deliberately falsifying his responses to questions 28 a. and 28
b., Applicant violated 18 U.S.C. § 1001, which provides in pertinent part:
a) Except as otherwise provided in this section, whoever, in any matter
within the jurisdiction of the executive, legislative, or judicial branch of the
Government of the United States, knowing and willfully: (1) falsifies,
conceals, or covers up by any trick, scheme, or device a material fact: (2)
makes any materially false, fictitious, or fraudulent statement or
representation; or (3) makes or uses any false writing or document
knowing the same to contain any materially false, fictitious, or fraudulent
statement or entry; shall be fined under this title or imprisoned not more
than 5 years, or both.
Disqualifying condition AG ¶ 31(c) (“allegation or admission of criminal conduct,
regardless of whether the person was formally charged, formally prosecuted or
convicted”) must be considered in evaluating Applicant’s current security suitability. 
Applicant’s false denials of any delinquent debts in October 2006 are too recent
to consider AG ¶ 32(a) (“so much time has elapsed since the criminal behavior
happened, or it happened under such unusual circumstances that it is unlikely to recur
and does not cast doubt on the individual’s reliability, trustworthiness, or good
judgment). Applicant’s disclosures of the details of his financial situation and his
contributions to his employer are some evidence of rehabilitation, but not enough to
satisfy AG ¶ 32(d) (“there is evidence of successful rehabilitation; including but not
limited to the passage of time without recurrence of criminal activity, remorse or
restitution, job training or higher education, good employment record, or constructive
community involvement”). As noted above, Applicant presented inconsistent
explanations for his failure to admit to delinquent debt on his security clearance
application. Doubts persist about his rehabilitation, as he has yet to demonstrate that his
representations can be relied on.
Whole Person Concept
Under the whole person concept, the Administrative Judge must evaluate an
Applicant’s eligibility for a security clearance by considering the totality of the Applicant’s
conduct and all the circumstances. The Administrative Judge should consider the nine
adjudicative process factors listed at AG ¶ 2(a): “(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) extent to which participation
is voluntary; (6) the presence or absence of rehabilitation and other permanent
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.”
Under AG ¶ 2(c), the ultimate determination of whether to grant eligibility for a security
clearance must be an overall commonsense judgment based upon careful consideration
of the guidelines and the whole person concept. 
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I considered the potentially disqualifying and mitigating conditions in light of all
the facts and circumstances surrounding this case. At work, Applicant has shown
reliability and dedication. Albeit recent, he has taken significant steps to resolve the
financial issues of concern to the Government (see AG ¶ 2(a)(6)). The Government
must be assured that those persons granted access can be counted on to fulfill their
fiduciary obligations irrespective of the personal cost. Fully aware of the importance of
the security clearance application because he had held a secret clearance for his duties
in the U.S. military, Applicant elected to conceal his history of financial problems from
the Government. Even if he lacked knowledge of the financial details because his
spouse handled the finances, he knew they had financial debts that they had not repaid.
It was incumbent upon him to at a minimum check with his spouse and he did not do so.
While he now claims he did not have access to his spouse when he completed the
questionnaire, the evidence shows he had to re-sign the form a few days after he first
completed it. There is no evidence that he made any effort during that time to determine
the status of their long overdue accounts. Concerns that he may place his personal
interests ahead of his fiduciary obligations preclude me from finding that it is clearly
consistent with the national interest to grant him access.
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:
Paragraph 1, 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
Paragraph 2, Guideline E: AGAINST APPLICANT
Subparagraph 2.a: Against Applicant
Subparagraph 2.b: Against Applicant
Paragraph 3, Guideline J: AGAINST APPLICANT
Subparagraph 3.a: Against Applicant
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Conclusion
In light of all of the circumstances presented by the record in this case, it is not
clearly consistent with the national interest to grant Applicant eligibility for a security
clearance.  Eligibility for access to classified information is denied.
                                              
________________________
ELIZABETH M. MATCHINSKI
Administrative Judge