DEPARTMENT OF DEFENSE 
         DEFENSE OFFICE OF HEARINGS AND APPEALS 
           
             
 
In the matter of: ) 
) 
 )       ADP Case No. 07-12789 
 SSN: ) 
) 
Applicant for Public Trust Position ) 
 
 
Appearances 
 
For Government: Caroline H. Jeffreys Esquire, Department Counsel 
For Applicant: Pro Se 
 
                                                                             
 
______________ 
 
Decision 
______________ 
 
 
HOGAN, Erin C., Administrative Judge: 
 
Applicant submitted her Questionnaire for Public Trust Position (SF 85P), on May 
10, 2006. On March 7, 2008, the Defense Office of Hearings and Appeals (DOHA) issued a 
Statement of Reasons (SOR) detailing the trustworthiness concerns under Guideline F, 
Financial Considerations, 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); Department of 
Defense (DoD) Regulation 5200.2-R, Personnel Security Program, dated Jan. 1987, as 
amended (Regulation), 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 April 29, 2008, and requested a hearing 
before an Administrative Judge.  Department Counsel was prepared to proceed on May 15, 
2008. I received the case assignment on May 20, 2008. DOHA issued a notice of hearing 
on June 5, 2008, and I convened the hearing as scheduled on June 25, 2008. The 
 
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government offered Exhibits (Gov) 1 through 5, which were admitted without objection.  
Applicant testified on her own behalf, and submitted one document that was admitted as 
Applicant Exhibit (AE) A without objection. The record was held open until June 16, 2008. 
Applicant timely submitted a two page document that was admitted as AE B. DOHA 
received the transcript of the hearing (Tr.) on July 3, 2008. Based upon a review of the 
case file, pleadings, exhibits, and testimony, eligibility for access to sensitive information is 
granted. 
 
Findings of Fact 
 
In her answer to the SOR, Applicant admitted to SOR allegations ¶¶ 1.a and 1.d. 
She partially admits but denies SOR ¶¶ 1.c and 1.e.  She denies SOR allegations ¶ 1.b. In 
addition, after a thorough and careful review of the pleadings and exhibits, I make the 
following findings of fact.  
 
Applicant is a 54-year-old employee of a Department of Defense contractor who is 
seeking a position of public trust. She has worked as a project manager for her current 
employer since April 2006.  She was awarded a masters degree in business administration 
(MBA) in January 2008. She is divorced and has a daughter, age 34. (Tr at 4-5, 21-22, 47; 
Gov 1.)  
 
On May 10, 2006, Applicant submitted a questionnaire for public trust position, 
Standard Form 85P. She listed her delinquent debts on her trustworthiness application. 
(Gov 1, question19-20.) Applicant has the following delinquent accounts: a $7,789 charged 
off credit card account (SOR ¶ 1.a; Gov 2 at 2; Gov 4 at 1; Gov 5 at 2); a $3,843 credit card 
account placed for collection (SOR ¶ 1.b; Gov 2 at 3, 8; Gov 3 at 1; Gov 4 at 1; Gov 5 at 3); 
a $9,904 debt related to a timeshare maintenance fee (SOR ¶ 1.c; Gov 4 at 2); a $6,757 
delinquent account related to an automobile repossession (SOR ¶ 1.d; Gov 4 at 2); and a 
$14,308 debt related to a timeshare that was foreclosed in April 2004 (SOR ¶ 1.e; Gov 2 at 
4, 12). The debts alleged in SOR ¶¶ 1.c and 1.e are related to the same timeshare.  The 
timeshare was foreclosed in 2004. (Gov 2 at 12.) 
 
In the 1990s, Applicant was employed in a sales position. Her base pay was 
approximately $60,000 and she received an annual bonus of approximately $50,000. In late 
1999, Applicant was laid off. For eight months in 2000, she was either unemployed or 
worked low wage jobs. She was unable to pay her bills as a result of unemployment and 
the reduction in income. (Tr at 32-33, 39-41; Gov 1, question 6.)  
 
From 2002 to present, Applicant gradually worked her way up to better paying 
positions. She currently earns $63,000 per year. (Tr at 23, 33-34.)  Applicant attended a 
financial management program for approximately six months when she first moved to 
Arizona. (Tr at 54-55.) 
 
Of the debts alleged in the SOR, SOR ¶ 1.a is paid. Applicant settled this account for 
$3,500. (Tr at 14, 18, 35; Gov 3 at 2.) Since January 2007, Applicant has been making 
 
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payments of $100 per month to the collection agency now handling the debt alleged in SOR 
paragraph 1.b. (Tr at 15-16, 28; AE A.)  
 
Applicant has consulted an attorney regarding the timeshare foreclosure debts 
alleged in SOR ¶¶ 1.c and 1.e. She initially consulted an attorney in the state where she 
currently resides. The attorney advised her to seek legal advice from an attorney licensed 
to practice in the state where the timeshare is located. Applicant purchased this timeshare 
in 1997 or 1998. At the time she could afford the timeshare because she was making over 
$100,000 a year. She stopped making payments in 2000 after she was laid off and could no 
longer afford to make payments. (Tr at 18-19, 39.) After the hearing, Applicant submitted a 
statute pertaining to timeshare foreclosures in the state where the timeshare is located. (AE 
B.) Applicant is willing to the pay the timeshare debt if it is determined it is her debt. (Tr at 
43.)  
 
The debt alleged in SOR ¶1.d is related to an automobile repossession. The car was 
repossessed in 2000. In 2001, Applicant made payments of $150 per month but was 
unable to keep up the payments. She has not made a payment since 2001. She has not 
worked on resolving that debt yet. (Tr at 20, 43-44.)  
 
When Applicant started work with her current employer, she had 12 debts that 
needed to be resolved. She would save up money and work with the creditors to negotiate 
settlements and/or payment agreements.  She resolved seven of the 12 debts prior to the 
SOR being issued. (Tr at 20-21, 49.) She is current on all of her other bills not listed in the 
SOR. (Tr at 45.)  
 
After obtaining her MBA in January 2008, Applicant hopes to move up in the 
company. She recently interviewed for a position and is waiting for a second interview. If 
she gets promoted, she will get a 15% increase in pay. (Tr at 50-51.)  
 
Applicant has sufficient income to pay her monthly obligations. (Tr at 25-28; Gov 2 at 
5.) She will begin paying back her student loans in July 2008. Her payments will be $350 
per month. She will reduce the $500 monthly tithe to her church in order to meet her 
student loan payments. She receives a quarterly bonus which is approximately $400 to 
$600. She uses her bonus to resolve her accounts. She recently began a part-time 
business which she hopes will bring in extra income. (Tr at 29-31.)          
  
Policies 
 
Positions designated as ADP I and ADP II are classified as Asensitive positions.@  
(See Regulation && C3.1.2.1.1.7 and C3.1.2.1.2.3.)  AThe standard that must be met for . . 
assignment to sensitive duties is that, based on all available information, the person=s 
loyalty, reliability, and trustworthiness are such that . . . assigning the person to sensitive 
duties is clearly consistent with the interests of national security.@ (See Regulation & 
C6.1.1.1.) The Deputy Under Secretary of Defense (Counterintelligence and Security) 
Memorandum, dated November 19, 2004, indicates trustworthiness adjudications will apply 
to cases forwarded to DOHA by the Defense Security Service and Office of Personnel 
 
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Management.  Department of Defense contractor personnel are afforded the right to the 
procedures contained in the Directive before any final unfavorable access determination 
may be made. (See Regulation & C8.2.1.)   
 
When evaluating an Applicant=s suitability for a public trust position, the 
Administrative Judge must consider the disqualifying and mitigating conditions in the AG. 
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 Awhole 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[a]ny doubt concerning personnel being considered for access to [sensitive] 
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 Awitnesses 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 trustworthiness decision.  
 
A person who seeks access to sensitive 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 
sensitive information. Decisions include, by necessity, consideration of the possible risk the 
Applicant may deliberately or inadvertently fail to protect or safeguard sensitive information. 
Such decisions entail a certain degree of legally permissible extrapolation as to potential, 
rather than actual, risk of compromise of sensitive information. 
  
Section 7 of Executive Order (EO) 10865 provides that decisions shall be Ain 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 
 
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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 disqualifying conditions that could raise security 
concerns. I find Financial Considerations Disqualifying Condition (FC DC) &19(a) (an 
inability or unwillingness to satisfy debts); and FC DC &19(c), (a history of not meeting 
financial obligations) apply to Applicant’s case. Applicant has a history of not meeting 
financial obligations.  She has had difficulty paying her debts since 2000. The SOR alleged 
five debts, a total approximate balance of $42,601.  The majority of the debt involves a 
repossessed timeshare and a repossessed automobile.       
 
The guideline also includes conditions that could mitigate security concerns arising 
from financial difficulties. Financial Considerations Mitigating Condition (FC MC) ¶ 20(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) is not applicable. Applicant’s history of 
financial irresponsibility is too recent to apply this mitigating condition. Although, she has 
taken steps to resolve her delinquent accounts, she has several accounts that remain 
unresolved.   
 
 FC MC & 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 based on Applicant’s eight-month period of 
underemployment after she was laid off in 1999.  She earned over $100,000 in annual 
income at the time she was laid off.  It took Applicant some time to find a full-time job that 
that had a good income. She still does not earn close to $100,000 in annual income. Once 
she found a job that paid a reasonable income, she took steps to resolve her delinquent 
accounts.  
 
FC MC ¶20(c) (the person has received or is receiving counseling for the problem 
and/or there are clear indications that the problem is being resolved or is under control) 
applies. Applicant attended a financial management class for approximately six months. 
She established a plan to resolve her delinquent accounts. She resolved one account in the 
SOR and is making payments towards another debt. She resolved several other accounts 
that were not included in the SOR. The remaining debts relate to an automobile 
repossession and a timeshare foreclosure. Applicant now earns sufficient income to meet 
her expenses.  Her financial situation is under control.  
 
FC MC &20(d) (the individual initiated a good-faith effort to repay overdue creditors 
 
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or otherwise resolve debts) applies. Although she has not resolved the debts alleged in 
SOR ¶¶ 1.c, 1.d and 1.e, she resolved the debt in SOR ¶ 1.a and has been making 
payments for the past year and half on the debt in SOR ¶ 1.b.  Credit is given to the fact 
that Applicant resolved several delinquent accounts prior to the SOR being issued once she 
had the income to start making payments towards her delinquent accounts.  Her approach 
was to save her extra income in order to discuss settlement with one or two of her 
creditors. This is a reasonable approach because Applicant’s income was insufficient to 
resolve the delinquent accounts all at once.  Although she has not fully resolved the debts 
related to the timeshare foreclosure, she has consulted legal counsel about her liability for 
such debt.    
 
Applicant’s systematic efforts towards resolving her delinquent accounts shows a 
good-faith effort to improve her financial situation. She has mitigated the concerns raised 
under Guideline F.    
    
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 
common sense 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. I considered Applicant’s financial problems 
were the result of being laid off from a highly paid job and, not being able to find 
employment providing a similar income. I considered Applicant’s efforts to obtain her MBA 
which has the potential to increase her income. She has taken steps to resolve her financial 
situation. While not all of the delinquent accounts are resolved, she demonstrated a good 
faith effort to resolve her financial situation. For these reasons, I conclude Applicant 
mitigated the security concerns arising under financial considerations.  
     
 
 
 
 
 
                                
 
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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 
 
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 public trust position. 
Eligibility for access to sensitive information is granted. 
 
 
 
                                                   
_________________ 
ERIN C. HOGAN 
Administrative Judge