DEPARTMENT OF DEFENSE 
       DEFENSE OFFICE OF HEARINGS AND APPEALS 
           
             
 
 
 
In the matter of: ) 
  )  
 -------------------------  )  
 SSN: ----------------- )       ISCR Case No. 06-26741 
 ) 
Applicant for Security Clearance ) 
 
 
Appearances 
 
For Government: Richard A. Stevens, Esquire, Department Counsel 
        For Applicant: Pro se               
         
                               
______________ 
 
Decision 
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ABLARD, Charles D., Administrative Judge: 
Applicant failed to mitigate security concerns regarding Guideline F (Financial 
Considerations). Clearance is denied.  
Statement of the Case 
Applicant submitted his Security Clearance Application (SF 86), on March 20, 
2006. On January 10, 2008, the Defense Office of Hearings and Appeals (DOHA) 
issued a Statement of Reasons (SOR) detailing the security concerns under Guidelines 
F (Financial) 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 answered the SOR in writing on January 31, 2008, and requested a 
hearing before an Administrative Judge. Department Counsel was prepared to proceed 
on February 11, 2008, and I received the case assignment on February 25, 2008. 
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DOHA issued a notice of hearing on February 27, 2008, for a hearing on March 14, 
2008, and I convened the hearing as scheduled.  
At the hearing, the government offered four exhibits (Exh.) which were admitted 
in evidence without objection. Applicant submitted six exhibits which were admitted 
without objection. He and one witness testified on his behalf. DOHA received the 
transcript of the hearing (Tr.) on March 24, 2008. I granted Applicant’s request to keep 
the record open until April 15, 2008, to submit additional evidence. Two additional 
documents were received on April 14, 2008, and admitted without objection. Based 
upon a review of the case file, pleadings, exhibits, and testimony, eligibility for access to 
classified information is denied. 
Procedural and Evidentiary Rulings 
Notice 
The hearing notice was dated 15 days before the hearing date. I advised 
Applicant of his right under ¶ E3.1.8 of the Directive to 15 days notice before the 
hearing. Applicant affirmatively waived his right to the 15 days notice and indicated he 
was ready to proceed (Tr. 9).  
Pleading 
 The government conceded that two allegations (SOR ¶ 1.i. and k) are duplicates 
and withdrew the second (Tr. 7).  
Findings of Fact 
In his Answer to the SOR, Applicant admitted eleven of the fourteen allegations 
in the SOR relating to approximately $11,000 in delinquent debts. He denied the other 
three allegations. He attached copies of letters dated the same date as his answer (Exh. 
D) that he sent to several of the creditors questioning the debts or asking for information 
about them. He also wrote to three credit reporting agencies on March 8, 2008, a week 
before the hearing, regarding duplicate reports and erroneous reports of debts.  
Applicant is a 41-year-old employee of a government contractor working as a 
logistics specialist supporting Special Forces since January 2006. He held an interim 
security clearance until this matter arose. He served in the Marine Corps between 1983 
and 1991 and was honorably discharged as a corporal. He served in Okinawa and in a 
NATO group in the Mediterranean. He served in Kuwait during Operation Desert Storm. 
Between the time of his discharge and his present employment he worked in several 
jobs as a cook. He was unemployed for three months in 2003. He has some college 
education in the culinary field. He took a second job one year ago as a restaurant cook 
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in an effort to earn more and resolve the delinquent debt issues raised in this 
proceeding.  
Applicant has been married twice. The first was in 1985 and he was divorced in 
1992. He married again in 1994 and was separated in 2003. He is not divorced from his 
second wife, but is attempting to do so which is difficult since she lives in another state 
and he has been unable to have much contact with her. He now lives with his fiancé 
and they have a three- year-old child. He had medical problems in 2002 and was 
operated and treated for cancer.  
The delinquent debts arose from an automobile repossession, and various other 
bills for products and services. A summary of the debts and their status based on 
testimony reveals the following (Tr. 30-48).  
1. SOR ¶ 1.a. is for $5,432 arising from an automobile 
repossession in 2002. It constitutes the largest of the delinquent debts. 
One credit report does not now list it but the debt is still owed. The 
creditor has not been in contact with Applicant and when Applicant 
obtains a divorce he hopes any remaining issue will be resolved in a 
financial decree apportioning the debt.  
2. SOR ¶ 1.b. Utility bill for $68 which is unpaid and he is checking 
on it with the creditor.  
3. SOR ¶ 1.c. Satellite dish debt for $256 was settled for $200. 
(Exh. A) 
4, SOR ¶ 1.d. Gymn membership debt of over $2,000 from a one 
year membership that he could not cancel when he lost a job. Charges 
have built up and he has been unable to resolve the issue. He was in 
contact with a credit counselor on this issue but is not now.  
5. SOR ¶ 1.e. Telephone bill for $313 which he believed his wife 
had paid. 
6. SOR ¶ 1.f. Cell phone bill for $649 and his wife took the phone 
with her when she they separated.  
7. SOR ¶ 1.g. He is unaware of this debt on the credit report for 
$804 but wrote to the creditor for information.  
8. SOR ¶ 1.h. A debt for $281 to a bank where he had a checking 
account. He is unaware of the source of the debt and has written to the 
bank.  
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9. SOR ¶ 1.i. Debt to a video store for $70. He wrote to the 
company but the letter was returned (Exh. D). He still has an account with 
the same company.  
10. SOR ¶ 1.j. Cable service debt of $298 but he still has an 
account with the same company and is unaware of the debt.  
 11. SOR ¶ 1.k. Duplicate of 1.i. Dismissed from SOR by 
government.  
12. SOR ¶ 1.l. Medical bill for $561 from hospital where he was 
treated but was not been billed. He has discussed the debt with the 
hospital and written to them. He believes it is in error but hospital has not 
answered letter.  
13. SOR ¶ 1.m. Medical debt which he paid in full for $137 (Exh. 
B).  
14. SOR ¶ 1.n. A medical debt for $165 which he cannot identify. 
Hehas written to the creditor butec no response.  
15.SOR ¶ 1.o. A dental bill from 2003 which had a balance of $185 
after dental insurance paid the remainder. He believed that his wife had 
paid the bill. Paid in full on February 1, 2008 (Exh. C).  
Thus, he has paid only two of the delinquent debts for $357 out of the total 
delinquent debts of $11,000.  
In addition to the above delinquent debts cited in the SOR, Applicant had two 
other debts on which he offered evidence. The first of these was for outstanding student 
loans of $24,000 most of which were consolidated in 2006. He pays $158 per month to 
the lender (Tr. 62-63). He also pays an additional $50 a month to an attorney who is 
collecting for the portion that was not consolidated. The second related to dispute and 
claim of over $1,000 to an apartment complex where he once lived. It was settled for 
$185 on February 1, 2008 (Exh. C).  
Applicant’s annual salary from his principal employment is approximately 
$38,000 (Tr. 74). His annual salary from his second job is $15,000 (Tr. 63). With his 
second job, he has over $1,000 a month remaining after expenses and deductions (Tr. 
87). He has one automobile which is fully paid (Tr. 88). His fiancé owns the home they 
live in and he pays the mortgage.  
Applicant is highly regarded by his government contract employer in his 
evaluation and letter of recommendation from his supervisor. (Exh. F and G). His 
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supervisor at his second job testified favorably about his skills and dedication to the job 
(Tr. 78-85).  
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 
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 
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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 “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 the delinquent debts cited in the SOR and 
was unable or unwilling to pay the obligations for several years. Thus, the evidence 
clearly raises these potentially disqualifying conditions. 
The guideline also includes examples of conditions that could mitigate security 
concerns arising from financial difficulties. Under AG ¶ 20 (a), the disqualifying condition 
may be mitigated where “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.@ Most of 
Applicant=s financial problems arose in the past ten years when he had marital problems 
and low paying jobs in the food service industry. While they have been extant for a 
period of time, he has held a job for over two years which pays a reasonable salary and 
a second job for over a year that provides supplemental income so he could have made 
more progress during that time to pay or resolve more of the debts.  
Under AG & 20 (b), the security concern also may be mitigating where Athe 
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 
his medical problems and periods of reduced income. He has paid only two of the 15 
debts listed in the SOR in the past year. The two debts total only $337 out of the 
$11,000 listed. While some of the debts may not be his responsibility, the issues of 
responsibility have not be resolved. His efforts to communicate with creditors and the 
credit agencies was tardy at best. While some of the debts may have arisen for causes 
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beyond his control, his actions since they became known to him have not been 
responsible. 
Under AG ¶ 20 (c) mitigation by applied if the person has received counseling or 
is receiving it and the problem has been resolved or is under control. Applicant received 
some counseling for the second largest debt (SOR ¶ 1.d.) but dropped it before 
resolution of the debt so this condition is inapplicable.  
AG & 20 (d) is another mitigating condition that applies where the evidence 
shows the individual initiated a good-faith effort to repay overdue creditors or otherwise 
resolve debts. While it not necessary for mitigation to apply that all of the delinquent 
debts be resolved, it is necessary that a significant portion of this many debts be settled 
or paid. I believe this test has not been met. He should have taken steps earlier to 
resolve more of the debts. He has resolved two of the debts that he has been able to 
identify and authenticate. He has only recently and in anticipation of the hearing 
communicated in writing or orally with the other creditors to ascertain the source of the 
debts. Thus, I conclude that the mitigating conditions do not 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 as well as the 
above nine factors in light of all the facts and circumstances surrounding this case. 
Applicant was employed in the food service for 15 years at low wages during which time 
he married twice, was divorced once and separated once. He also had some serious 
health issues. Although the medical expenses do not seem to have added much to his 
financial problems, they complicated his ability to resolve them. The separation from his 
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second wife whom he believed was paying the bills was a major element in creating his 
financial situation. 
Although, he has taken some steps to resolve the delinquent debts and is in a 
position to do so now with his second job, at this time there has been an insufficient 
showing of timely responsible action to justify application of the mitigating conditions or 
the whole person concept. Applicant has not mitigated the security concerns arising 
from these financial considerations and it is premature to grant a security clearance. 
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: AGAINST APPLICANT 
 
Subparagraph 1.a.: Against Applicant 
Subparagraph 1.b.: Against Applicant 
Subparagraph 1.c.: Against Applicant 
Subparagraph 1.d.: Against Applicant 
Subparagraph 1.e.: Against Applicant 
Subparagraph 1.f.:  Against Applicant 
Subparagraph 1.g.: Against Applicant 
Subparagraph 1.h.: Against Applicant 
Subparagraph 1.i.:  Against Applicant 
Subparagraph 1.j.:  Against Applicant 
Subparagraph 1.k.: Against Applicant 
Subparagraph 1.l.:  Against Applicant 
Subparagraph 1.m.:Against Applicant 
Subparagraph 1.n.: Against Applicant 
Subparagraph 1.o.: Against Applicant 
Conclusion 
In light of all of the circumstances presented by the record in this case, it is not 
clearly consistent with national security to grant Applicant eligibility for a security 
clearance. Access to classified information is denied. 
 
 
 
_________________________ 
CHARLES D. ABLARD 
Administrative Judge