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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
---------------------------- )       ISCR Case No. 07-13433
SSN: ----------------- )
)
Applicant for Security Clearance )
Appearances
For Government: Jennifer I. Goldstein, Esquire, Department Counsel
For Applicant: Pro se
July 29, 2008
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Decision
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ROSS, Wilford H., Administrative Judge:
Applicant submitted his Questionnaire for Sensitive Positions, on January 10,
2007.  (Government Exhibit 1.)  On February 8, 2008, the Defense Office of Hearings
and Appeals (DOHA) issued a Statement of Reasons (SOR) detailing the security
concerns under Guideline F concerning the 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 filed an Answer to the SOR on March 3, 2008, and requested a hearing
before an Administrative Judge.  Department Counsel was prepared to proceed on April
1, 2008.  I received the case assignment on April 8, 2008.  DOHA issued a notice of
hearing on April 18, 2008.  
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The hearing was convened on May 13, 2008.  The Government offered
Government Exhibits 1 through 6, which were received without objection. Applicant
testified on his own behalf and submitted Applicant’s Exhibits A through F, without
objection. The Applicant requested that the record remain open for the submission of
additional documents.  The Applicant submitted Applicant’s Exhibit G on May 29, 2008,
and it was received without objection.  DOHA received the transcript of the hearing on
May 22, 2008.  The record closed on May 30, 2008.  Based upon a review of the case
file, pleadings, exhibits, and testimony, eligibility for access to classified information is
granted.
Findings of Fact
The Applicant is 29, and he lives with his girlfriend and their two children.  He is
employed by a defense contractor and seeks to retain a security clearance previously
granted in connection with his employment.
Guideline F, Financial Considerations
The Applicant began working in the Defense industry in January 2007.  His
financial problems began in approximately 2001, when he was injured on the job at the
same time his partner had a child.  Subsequent to that time, he went through a period of
underemployment, he moved, and was the victim of identity theft and fraud committed
by a former roommate.  (Transcript at 33, 42, 46-48, 65-66.)
When the Applicant began working for the Defense industry, he also began
working to clean up his credit report.  Some of the debts on his report were fraudulent,
some had been paid but not removed and some were past due and had to be paid.  The
Applicant made a point by saying that the three credit reporting firms are not always
consistent in their timing or in what they report.  (Transcript at 71-72.)
Subparagraph 1.a.  The Applicant admits that he owed approximately $191.00
for a cable box he did not return.  The Applicant testified that he made a payment
arrangement with this creditor to pay $50.00 a month for four months.  (Transcript at 32,
62-64.)  The Applicant subsequently submitted emails showing that he had attempted to
contact this creditor to complete the transaction without success.  (Applicant’s Exhibit G
at 4-7.)  
Subparagraph 1.b.  The Applicant denies this debt in the amount of $439.00.  He
submits that this debt was fraudulently incurred in his name by his former roommate in
another state.  He has attempted to find the collection agency without success for
several months.  (Transcript at 33, 64-68.)  In addition, the Applicant has filed a dispute
with the credit reporting agencies, as reflected in Government Exhibit 4 at 1 and
Applicant’s Exhibit F at 2.  
Subparagraph 1.c.  The Applicant denies this debt in the amount of $64.00.  He
submits that this debt was fraudulently incurred in his name by his former roommate in
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another state.  The Applicant testified that he filed a dispute with the credit reporting
agencies, and the debt was removed.  His April 1, 2008, credit report reflects this.
(Applicant’s Exhibit F.)  The Government’s most recent credit report, dated May 13,
2008,  still reflects the debt.  (Government Exhibit 6 at 2.)   
Subparagraph 1.d.  The Applicant admits that he owed approximately $164.00 to
a credit union.  He paid this debt in full in approximately February 2006, as confirmed by
his credit report.  (Transcript at 34-35; Government Exhibit 2 at 12; Applicant’s Exhibits
B, D and Exhibit F at 3.)
Subparagraph 1.e.  The Applicant admits that he may owe a hospital $244.00 in
medical expenses.  He further submits that he had insurance at the time, which should
have paid this debt.  He has not yet investigated the circumstances but, if his insurance
will not cover it, he will pay the debt.  The Applicant further testified that he disputed this
debt with the credit reporting service he was working with, but he does not have any
proof of that.  (Transcript at 35-36, 72-73.)
Subparagraphs 1.f. and 1.g.  The Applicant admits that he owes a bank at least
$1,222.00 for a past due credit card.  The Applicant submits that this debt is a duplicate
of that set forth in Subparagraph 1.g. and that, after he contacted his credit reporting
agency, this debt is only set forth once.  (Transcript at 36, 73-75; Applicant’s Exhibit F at
1-2.)  The Government’s most recent credit report shows both debts.  (Government
Exhibit 6 at 2.)  The Applicant intends to settle this debt as soon as he can.
Subparagraph 1.h.  The Applicant admits that he owes a telephone company a
past due debt in the amount of $541.00.  This creditor will not work with the Applicant
and he has been unable to reach a payment arrangement with them.  He intends to pay
this debt as soon as he can.  (Transcript at 37, 75-77.)
Subparagraph 1.i.  The Applicant denies this debt to a telephone provider in the
amount of $325.00.  He submits that this debt was fraudulently incurred in his name by
his former roommate in another state.  The Applicant testified that he filed a dispute with
the credit reporting agencies, and the debt was removed.  This account was deleted
from his credit report effective May 14, 2008.  (Transcript at 37, 77-79, 96-97;
Applicant’s Exhibit G at 8.)
Subparagraph 1.j.  The Applicant admits that he owes a telephone company a
past due debt in the amount of $1,238.00.  The Applicant testified that he is in
negotiations with this creditor, and intends to pay this debt as soon as he can.
(Transcript at 37, 81-82.)
Subparagraph 1.k.  The Applicant admits that he may owe a hospital $267.00 in
medical expenses.  He further submits that he had insurance at the time, which should
have paid this debt.  He has not yet investigated the circumstances but, if his insurance
will not cover it, he will pay the debt.  He has been in contact with the creditor, but he
has not yet worked out any payment arrangement.  (Transcript at 37-38, 82-83.)
It is noted that the Applicant paid this debt, his largest, more than a year before the SOR was issued.1
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Subparagraph 1.l.  The Applicant admits that he owed approximately $3,303.00
to a bank for an automobile loan.  He paid this debt in full in approximately December
2006, as confirmed by credit reports submitted by the Applicant and the Government.
(Transcript at 38, 83-85, 87, 101-102; Government Exhibit 2 at 19-20, Exhibit 3 at 4 and
Exhibit 4 at 2.)1
Subparagraph 1.m.  The Applicant admits that he may owe money to this
collection agency for a DirecTV bill, however he denies that the amount is $255.00.  He
testified that every time he requests information on the account, it is removed from his
credit report.  (Transcript at 38-39, 86-88, 98-99.)  He submitted evidence showing that
he had been in touch with DirecTV in November 2007 in an attempt to figure out the bill.
(Government Exhibit 2 at 7.)  This debt appears in both 2007 credit reports in the
record; one provided by the Government (Government Exhibit 3 at 4) and one from the
Applicant (Government Exhibit 2 at 17).  However, the debt does not appear in any of
the 2008 credit reports submitted by the Government or the Applicant.  (Government
Exhibits 4, 5 and 6; Applicant’s Exhibit F.)
Subparagraph 1.n.  The Applicant admits that he owed approximately $116.00 to
a law firm for a non-sufficient funds check.  He paid this debt in full in approximately
April 2005.  The law firm has a history of shady dealing, and he had to get another law
firm involved in order to get the entry removed from his credit reports.  (Transcript at 39,
88-90; Government Exhibit 2 at 8.)  The Applicant was unable to provide proof of
payment, other than the fact that the debt has been removed from his credit report. This
debt appears in both 2007 credit reports in the record; one provided by the Government
(Government Exhibit 3 at 6) and one from the Applicant (Government Exhibit 2 at 19).
However, the debt does not appear in any of the 2008 credit reports submitted by the
Government or the Applicant.  (Government Exhibits 4, 5 and 6; Applicant’s Exhibit F.)
Subparagraph 1.o.  The Applicant originally denied he owed this debt to an
insurance company in the amount of $82.00.  However, after he determined he could
not supply information to the insurance company showing that he did not owe the debt,
he made arrangements to pay it electronically.  (Transcript at 39-41, 90-93; Applicant’s
Exhibits E and F at 2.)
The Applicant submitted that his current financial situation is stable.  He is able to
pay his current debts and work towards resolving his past due indebtedness.  In
addition, his credit reports show that he has successfully paid off two automobile loans
in the recent past.  His financial difficulties were over a limited time, and he is working to
pay those debts that are his and have removed from his credit report those that are not. 
As of the date the record closed, he had paid $3,665.00 towards his debts in the
SOR.  In addition, he is disputing in good faith an additional $1,579.00 worth of debt and
$828.00 of debt had been removed as fraudulent.  His current admitted indebtedness
stands at $3,703.00. 
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Mitigation
The Applicant submitted letters from supervisors and co-workers.  They describe
the Applicant as “trustworthy, responsible and clearly an asset to his job.”  (Applicant’s
Exhibit A.) 
Policies
Security clearance decisions are not made in a vacuum.  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.  In addition, the Administrative Judge may also rely on his own
common sense, as well as his knowledge of the law, human nature, and the ways of the
world, in making a reasoned 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. Security clearance decisions include, by
necessity, consideration of the possible risk that the Applicant may deliberately or
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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.
 
Finally, as emphasized by President Eisenhower in Section 7 of Executive Order
10865, “Any determination under this order . . . shall be a determination 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(c), Aa history of not meeting financial obligations@ may raise security concerns.
There is evidence in the record that the Applicant may have owed approximately
$9,775.00 to the creditors named in the SOR.  The evidence is sufficient to raise this
potentially disqualifying condition, requiring a closer examination.
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 Athe 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.@ In addition, AG
¶ 20(b) states that it may be mitigating if “the conditions that resulted in the financial
problems were largely beyond the person’s control (e.g., loss of employment, . . .
unexpected medical emergency), and the individual acted responsibly under the
circumstances.”
 The majority of the Applicant’s past due indebtedness was incurred in 2001
when the Applicant was injured on the job, lost his job and his girlfriend had a child.  As
described at length above, once the Applicant was employed in the Defense industry,
he had a plan to pay off his past due indebtedness and, for over one year, has been
successfully fulfilling it.  I find the behavior occurred under such unusual circumstances
that it is unlikely to recur, and it does not raise concerns about his current reliability,
Department Counsel correctly states that the mere absence of an entry on a credit report is not, standing2
alone, evidence that the debt has been paid.  However, here the Applicant has shown by documentary
evidence his proactive attempts to work towards paying his bills.  In addition, as the Applicant correctly says,
each of the three credit reporting agencies have different policies and may not post items at the same time.
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trustworthiness, or good judgment. The evidence raises this potentially mitigating
condition.  
AG ¶20(c) applies if “there are clear indications that the problem is being
resolved or is under control.”  Evidence that Athe individual initiated a good-faith effort to
repay overdue creditors or otherwise resolve debts@ is also mitigating under ¶20(d).
Finally, it can also mitigating if “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.”  (AG ¶20(e).)  
The Applicant has shown by the use of email trails with several creditors that he
has been attempting to resolve his indebtedness for some time.  He has successfully
disputed some of his debts as being fraudulent or otherwise not valid. In addition, the
Applicant is able to pay his current bills and also pay off his older debts.   His admitted2
past due indebtedness has been reduced to less than $4,000.00.  He has control over
his current indebtedness, has paid a substantial amount of money towards the
arrearage, and has shown a more than credible willingness to continue paying off his
past due indebtedness.  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.  The Applicant, by his own
admission, ran into a “bad patch” in 2001.  Rather than avoid them, once he obtained
steady and well-paying employment in the Defense industry, he immediately began to
pay his debts once he knew their full extent, and has already paid a substantial amount
towards them.  He has a plan to pay all of his debts and is fulfilling it.  He has behaved
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reasonably and appropriately in trying to resolve his debts, thereby AG ¶ 2(a)(6) applies.
Under the particular circumstances of this case, I find that there is little to no potential
for pressure, coercion, exploitation, or duress (AG ¶2(a)(8)), and that the likelihood of
recurrence is close to nil (AG ¶2(a)(9)). 
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 THE APPLICANT
Subparagraphs 1.a through 1.o.: For the Applicant
Conclusion
In light of all of the circumstances presented by the record in this case, it is
clearly consistent with the national interest to grant Applicant eligibility for a security
clearance.  Eligibility for access to classified information is granted.
                                              
_________________
WILFORD H. ROSS
Administrative Judge