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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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                                                          )             ISCR Case No. 07-06482
SSN:                     )
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Applicant for Security Clearance )
Appearances
For Government: Carolyn H. Jeffreys, Esquire, Department Counsel
For Applicant: Pro Se
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Decision
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HOWE, Philip S., Administrative Judge:
Applicant submitted his Security Clearance Application (SF 86), on June 15,
2006. On October 15, 2007, the Defense Office of Hearings and Appeals (DOHA)
issued a Statement of Reasons (SOR) detailing the security concerns under Guideline F
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 October 24, 2007. He answered
the SOR in writing on October 26, 2007, and requested a hearing before an
Administrative Judge. DOHA received the request on November 13, 2007. Department
Counsel was prepared to proceed on November 28, 2007, and I received the case
assignment on December 13, 2007, after it was transferred from another administrative
judge because of caseload. DOHA issued a notice of hearing on December 17, 2007,
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and I convened the hearing as scheduled on January 8, 2008.  The government offered
Exhibits (Ex.) 1 through 4, which were received without objection. Applicant testified on
his own behalf and offered no exhibits. DOHA received the transcript of the hearing (Tr.)
on January 25, 2008.  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 Answer to the SOR, dated October 26, 2007, Applicant admitted the factual
allegations in ¶¶ 1.a, 1.c to1.e of the SOR, with explanations. He denied the factual
allegations in ¶¶ 1.b and 1.e of the SOR. He also provided additional information to
support his request for eligibility for a security clearance.  
Applicant is 28 years old, divorced, with one child from his present relationship.
He works for a defense contractor as an engineering technician.  He has an associate’s
degree, obtained in May 2003.  He started work at his current job in May 2005.
Previously, he had employment with several local companies. He is the sole support of
his family. (Tr. 13, 16, 27; Exhibit 1)
Applicant has six delinquent debts, totaling about $30,000.  He is currently
paying $18,000 in federal insured student loans, which he revived from default status in
2007.  Applicant made a down payment using part of his last year’s income tax refund.
He made payments for one year at $150 monthly.  The lender then considered the
loans rehabilitated, and lowered the payments to $125 monthly.  Applicant continues to
make those payments intending to repay the loans in full. (Tr. 8, 22, 23, 30; Exhibits 1-
4)
Applicant owes $318 on a medical bill for treatment of a work-related injury in
2000 (SOR Subparagraph 1.a).  He did not have medical insurance and eventually
realized he had to pay for the emergency room treatment.  Applicant intends to repay
this debt in 2008 from his 2007 income tax refund. (Tr. 19, 20, 33, 38; Exhibits 2-4)
Applicant owes $360 on a lease for a former apartment (SOR Subparagraph
1.b).  He lived there two years, never had a written lease, and moved with giving only
two weeks notice.  The landlord retained his deposit and seeks the balance of the last
month’s rent of $360.  Applicant disputes owing the debt because he does not think he
had to give 30 days notice without a written lease being in effect.  Applicant intends to
pay this debt from his income tax refund. This debt occurred in October 2006. (Tr. 20,
33; Exhibits 2-4)
Applicant owes $215 for a medical bill (SOR Subparagraph 1.c).  This debt dates
from 2000.  Applicant is not certain the basis for this debt.  However, he intends to
repay it from his income refund received this year. (Tr. 21, 33; Exhibits 2-4)
Applicant has two student loans on which he is not currently paying because he
does not have sufficient income to do so.  They are private student loans (SOR
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Subparagraphs 1.d and 1.e), totaling about $17,000.  Applicant had insufficient income
before obtaining his current job to repay all the student loans, both the federal and
private student loans.  Now, he intends to use a substantial portion of his income tax
refund to make a down payment on these private loans, and enter a repayment
installment plan.  He intends to repay all his debts as quickly as he is financially able to
do so. He contacted the lender last year about arranging repayment plan, but the lender
would not negotiate a plan with him.  Applicant intends to keep trying to negotiate a
repayment plan. (Tr. 22-25, 29, 33, 38, 39, 46; Exhibits 2-4)
Applicant’s last delinquent debt is $13,036 for a car repossessed in 2000.
Applicant bought the car after graduating from high school.  He could pay the $300
monthly loan payments, but the additional insurance monthly payments of $225 were
more than he could afford at his previous income level.  After a year of making
payments, he surrendered the car, which was later sold., Applicant asked for, but never
received an accounting of the amount for which the car sold.  Applicant disputes the
amount sought by the creditor because he has not been given the sale amount.  He
would like to establish a reasonable amount for repayment on this debt, and then enter
an installment payment plan with that creditor. (Tr. 14-19, 40; Exhibits 2-4)
Applicant has two credit cards, with balances of $170 and $200.  He pays those
credit card debts regularly.  He also pays his monthly expenses on time. (Tr. 28, 37)
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.
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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 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. 
The guideline notes several conditions that could raise security concerns. Under
AG & 19(a), an Ainability or unwillingness to satisfy debts@ is potentially disqualifying.
Similarly under AG & 19(c), Aa history of not meeting financial obligations@ may raise
security concerns. Applicant accumulated some 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.
The guideline also includes examples of conditions that could mitigate security
concerns arising from financial difficulties.  AG & 20(d) applies where the evidence
shows Athe individual initiated a good-faith effort to repay overdue creditors or otherwise
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resolve debts.@ Applicant rehabilitated on his own initiative the federal-insured student
loans.  He has faithfully paid that debt for over one year.  He has a plan to repay the
privately issued student loans, though his income will necessitate a long repayment time
period.  Applicant is the sole support of his family, and pays his monthly bills on time.
The listed debts date from four to seven years ago, with only one debt dating from 2006.
Applicant has not incurred additional delinquent debt during this time period.  He also
intends to repay the first three debts listed in the SOR from his tax refund this year.  His
testimony appeared sincere.  I conclude he is credible in his explanations of his financial
history and his plans to repay the debts.  Additionally, AG ¶ 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) applies because Applicant intends to
repay the two debts he denied and disputed. The credit reports show he disputed the
auto repossession debt, and he denied the lease debt in his SOR answer.  Based on
the totality of the evidence, I conclude these potentially mitigating conditions apply
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 considered the potentially disqualifying and mitigating conditions in light of all
the facts and circumstances surrounding this case. When these problems first began,
Applicant was a young man. (See AG & 2(a)(4).) He accumulated debt due to a desire
to obtain an education and to better himself.  He accomplished that goal, but the debt
remains. (See AG & 2(a)(2).)  Most significantly, he has taken affirmative action to pay
or resolve the larger of the two student debts raising security concerns. (See AG &
2(a)(6).  He took the initiative in 2006 to start that process. Thus, this debt cannot be a
source of improper pressure or duress. 
Applicant intends to pay his other debts.  His sincerity and credibility, coupled
with his performance on the student debt, persuade me that he will accomplish that goal
also. He has legitimate reasons to dispute the amount of money demanded by the
creditor for his repossessed car. He attempted to contact that creditor, along with the
private student loan creditor, to arrange reasonable installment repayment plans. To
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date, he has not received favorable responses. But he stated he would continue the
effort.  His tax refund this year will enable him to repay the first three debts listed in the
SOR, showing again his good-faith efforts within his financial abilities to repay his debts.
It is also significant that he does not have a succession of delinquent debts incurred
after the completion of his education.  He is managing his money and monthly expenses
responsibly.   
Of course, the issue is not simply whether all his debts are paid B it is whether
his financial circumstances raise concerns about his fitness to hold a security clearance.
While some debts remain unpaid, they are part of Applicant’s plan to repay them, and
so do not raise security concerns. (See AG & 2(a)(1).  Applicant is credible, informed
about his debts, and acting responsibly.  He presented his case in a diligent and
organized manner, demonstrating his commitment to repaying his debts.  He testified
forthrightly, and did not attempt to obfuscate or mislead.  
Overall, the record evidence leaves me without questions or doubts as to
Applicant’s eligibility and suitability for a security clearance. For all these reasons, I
conclude Applicant mitigated the security concerns arising from his financial
considerations. 
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 to 1.f: For Applicant
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.
                                              
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PHILIP S. HOWE
Administrative Judge