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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
------------------------- )       ISCR Case No. 07-05914
SSN: ----------------- )
)
Applicant for Security Clearance )
Appearances
For Government: Jeff Nagel, Esquire, Department Counsel
For Applicant: Pro Se
January 18, 2008
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Decision
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MOGUL, Martin H., Administrative Judge:
Applicant submitted his Security Clearance Application (SF 86), on February 2,
2005. On July 12, 2007, the Defense Office of Hearings and Appeals (DOHA) issued a
Statement of Reasons (SOR) detailing the security concerns under Guidelines F and E
for Applicant. The action was taken under Executive Order 10865, Safeguarding
Classified Information within Industry (February 20, 1990), 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 responded to the SOR (RSOR) in writing on August 8, 2007, and
requested a hearing before an Administrative Judge. I received the case assignment on
October 25, 2007. DOHA issued a notice of hearing on November 16, 2007, and I
convened the hearing as scheduled on December 11, 2007, in San Francisco,
California. The government offered Exhibits (Ex.) 1 through 8, which were received
without objection. Applicant testified on his own behalf and submitted Exhibits A through
M, without objection. DOHA received the transcript of the hearing (Tr.) on December 19,
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2007. Based upon a review of the case file, pleadings, exhibits, and testimony, eligibility
for access to classified information is granted.
Findings of Fact
In his RSOR Applicant admitted SOR allegations1.a. and 2.d., and he denied
1.b., 1.c., 1.d., 1.e., 2.a., 2.b., and 2.c. 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 testimony of
Applicant, and upon due consideration of that evidence, I make the additional findings of
fact: 
Applicant is 58 years old. He is married, and he has three children and one
stepson. He received a Ph. D. degree in Psychology in 1979.
Applicant does work for defense contractors, and he seeks a DoD security
clearance in connection with his employment in the defense sector.
The SOR lists 5 allegations regarding financial difficulties under Adjudicative
Guideline F. All of the allegations will be discussed in the same order as they were listed
in the SOR:
1.a. Applicant petitioned the United States Bankruptcy Court in 2001 for a
Chapter 7 bankruptcy, in which he claimed liabilities of $217,000. His debts were
discharged on January 29, 2002. As stated above, Applicant admitted this allegation.
He cited several reasons for his financial difficulties, which will be discussed below. 
1.b. This overdue debt to Creditor 1 is cited in the SOR in the amount of $2,090.
Applicant testified that this had been a debt of his, but it was discharged in the
bankruptcy, cited as 1.a., above. Exhibit C is a letter from Applicant’s former attorney,
who filed the Chapter 7 bankruptcy with the court on October 23, 2002. The attorney
states that all of Applicant’s debts were discharged on January 29, 2002, and he
attached a Schedule F, listing all creditors holding unsecured nonpriority claims. Since
Creditor 1 is listed on Schedule F, I therefore find that this debt was discharged in
bankruptcy in 2002, and Applicant no longer owes this debt. 
1.c. This overdue debt to Creditor 2 is cited in the SOR in the amount of $11,502.
Applicant acknowledged that this also had been a debt of his, but it was discharged in
the bankruptcy. Exhibit C also lists this debt to Creditor 2 on Schedule F.  I therefore
find that this debt was discharged in bankruptcy in 2002, and Applicant no longer owes
this debt. 
1.d. This second overdue debt to Creditor 2 is cited in the SOR in the amount of
$14,870. Applicant also acknowledged that this had been a debt of his, but it was
discharged in the bankruptcy. Exhibit C also lists this second debt to Creditor 2 on
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Schedule F.  I therefore find that this debt was discharged in bankruptcy in 2002, and
Applicant no longer owes this debt.
1.e. This SOR paragraph alleges that, based on a Personal Financial Statement
executed by Applicant on May 30, 2007, his monthly expenses exceed his monthly
income, and this does not even include the debts he owes as alleged in 1.b. through
1.d. First, as discussed above, Applicant does not owe debts 1.b. through 1.d., as they
have been discharged in bankruptcy.  
Applicant cited several factors for his previous financial difficulties. His first wife
had been diagnosed with Multiple Sclerosis. He also had been employed as a counselor
by a church, which was the primary source of his income. At some point, he
experienced a change of outlook and philosophy, and because of this he resigned his
position with the church and separated from his wife, both during the same period of
time in 1995. His income decreased by 75%, but he continued to support his wife after
they separated. Because of his loss of income , his financial situation continued to
deteriorate until he filed for bankruptcy in 2001. Applicant’s first marriage also ended in
dissolution 2001. 
Applicant testified that, together with his current wife who earns approximately
$90,000, his finances are in very good order and he does not have any overdue debts.
He introduced a credit report, dated August 14, 2007, (Exhibit B), which indicates that
he has no current delinquent accounts and that his financial score as of July 28, 2007,
was 690, which a very good score. He also testified that he purchased a home in 2007
for $430,000 with a fixed-rate mortgage of 6.25%, and he stated that he would not have
received such a favorable rate if his finances were not in good order. 
Finally, Applicant  also offered into evidence two letters from individuals who
know or have known him for may years in his professional life (Exhibits L and M). One is
the president of a company that does background investigations for the United States
Government, and who indicated that Applicant  has performed over 300 investigations
for his company. The other is an individual who is a retired Special Agent in Charge with
the United States Department of State and now performs background investigations.
They spoke in extremely laudatory terms of his high integrity and ability.
2.a. Applicant executed a signed Security Clearance Application (SCA) on
February 27, 2003. Question #38 asks,  “In the last 7 years, have you been over 180
days delinquent on any debt(s)?” Applicant answered “No” to this question. The
Government alleges that Applicant should have answered “Yes” to this question and
included the debts listed as 1.b. through 1.d., in the SOR. As discussed above, these
debts had already been discharged in bankruptcy, and he also averred that before the
bankruptcy was filed he had never been overdue on his debt, so Applicant’s response
was correct. 
2.b. Question #39 of the SCA asks,  “Are you currently over 90 days delinquent
on any debt(s)?” Applicant answered, “No” to this question and again listed no debts.
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Again, as these debts had already been discharged in bankruptcy, Applicant’s response
was correct. 
2.c. The Government alleges that during an interview with a Department of
Defense  investigator Applicant stated that he received income as a result of counseling
as a psychologist. However, he was not authorized to do so, since his license to
practice as a psychologist had been revoked in August 1999. Applicant testified credibly
that since 1999, he has not and does not hold himself out as a licensed psychologist.
Rather he performs therapy as a psychotherapist for which no license is required. He
also testified that he had not informed the investigator that he practiced psychology. 
I find no evidence that Applicant engaged in practicing as a license psychologist
without proper authorization. It is far more likely, based on the common substitution of
terms, that Applicant did say he practiced psychotherapy, and the investigator recorded
it as psychology. 
2.d. The Government alleges and Applicant has admitted that in October 1995 he
was civilly sued by a female client for Sexual Conduct and Inappropriate Behavior,
which resulted in the case being settled out of court, Applicant losing his license to
practice psychology, and damages being paid by his malpractice carrier in the amount
of $100,000. Applicant testified that despite the outcome of this case, he was never
inappropriate with his client. He averred credibly that this incident was fabricated by an
individual who wanted to hurt him. He fought the case but without an attorney, which he
felt he could not afford at the time, and he was ultimately unsuccessful.
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
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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
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 trustworthiness 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 [sensitive] information. An individual who is financially
overextended is at risk of having to engage in illegal acts to generate
funds. 
The guideline notes several conditions that could raise trustworthiness concerns.
Under AG ¶ 19 (a), an Inability or unwillingness to satisfy debts is potentially
disqualifying. Similarly under AG & 19 (c), a history of not meeting financial obligations
may raise security concerns. Applicant accumulated significant delinquent debt and was
unable to pay some obligations for a period of time. The evidence is sufficient to raise
these potentially disqualifying conditions, requiring a closer examination.
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The guideline also includes examples of conditions that could mitigate
trustworthiness concerns arising from financial difficulties.
AG ¶ 20 provides conditions that could mitigate security concerns:
(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. Applicant’s financial difficulties
occurred beginning in 1995, and were resolved in bankruptcy in 2001. Applicant’s now
has his finances in good order and has no overdue debts, so I find that his previous
adverse financial condition does not cast doubt on his current reliability. 
Under AG ¶  20 (b), it may be mitigating where 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. As noted above, some of
the financial problems arose from Applicant’s loss of employment and ultimately the
dissolution of his marriage. Applicant  acted responsibly in continuing to take care of his
wife who was ill, even after they separated, and ultimately resolving the difficult situation
in the legally available, although not preferred method of bankruptcy. l I find this
potentially mitigating condition is a factor for consideration in this case. 
 Applicant is now more financially sound and better prepared for future
contingencies. I conclude these potentially mitigating conditions apply.
GUIDELINE E, PERSONAL CONDUCT
AG ¶ 15 expresses the security concern pertaining to personal conduct:
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.
While AG ¶ 16 describes conditions that could raise a security concern and may
be disqualifying, I find that none apply in this case. First as discussed above, Applicant’s
representations regarding his finances on questions 38 and 39 of the SCA that he
completed were in fact correct. Additionally, Applicant’s testimony that he has not held
himself out as a licensed psychologist, but rather he simply practiced psychotherapy,
which he is entitled to do.  Finally, It is unclear what actually happened during the
incident alleged in 2.d., above,  but since more than 12 years has elapsed since this
event, and this is the only evidence that has been introduced of misconduct against
Applicant, I do not find this allegation to be of security concern.
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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.       
I have considered the potentially disqualifying and mitigating conditions under
Guidelines F and E, in light of all the facts and circumstances surrounding this case.
Based on all of the reasons cited above, including Applicant’s reasons for his previous
financial difficulties, his excellent economic condition today, and current his positive
status, I find that the record evidence leaves me without questions or doubts as to
Applicant’s eligibility and suitability for a security clearance under the whole person
concept. For all these reasons, I conclude Applicant mitigated the security concerns. 
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: FOR APPLICANT
Subparagraph 2.a: For Applicant
Subparagraph 2.b: For Applicant
Subparagraph 2.c: For Applicant
Subparagraph 2.d: For Applicant
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Conclusion
In light of all of the circumstances presented by the record in this case, it is
clearly consistent with national security to grant Applicant eligibility for a security
clearance.  Eligibility for access to classified information is granted.
                                              
Martin H. Mogul
Administrative Judge