DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
------------------------- )       ADP Case No. 07-11672
SSN: ----------------- )
)
Applicant for Public Trust Position )
Appearances
For Government: Jeffrey A. Nagel, Esquire, Department Counsel
For Applicant: Pro Se
______________
       Decision
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WESLEY, Roger C., Administrative Judge:
Statement of Case
On May 8, 2008, the Defense Office of Hearings and Appeals (DOHA), pursuant
to Executive Order 10865 and Department of Defense Directive 5220.6 (Directive),
dated January 2, 1992, issued a Statement of Reasons (SOR) to Applicant, which
detailed reasons why DOHA could not make the preliminary affirmative finding under
the Directive that eligibility for occupying an ADP I/II/III position is clearly consistent with
the national interest, and recommended referral to an administrative judge to determine
whether a trustworthiness determination should be granted, continued, denied or
revoked.
Applicant responded to the SOR on June 19, 2008, and requested a hearing.
The case was assigned to me on July 23, 2008, and was scheduled for hearing on
September 18, 2008.  A hearing was held on September 18, 2008, for the purpose of
considering whether it would be clearly consistent with the national interest to grant,
continue, deny, or revoke Applicant’s eligibility for occupying an ADP I/II/III position.  At
hearing, the Government's case consisted of eight exhibits; Applicant relied on one
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witness (herself) and no exhibits.  The transcript (R.T.) was received on September 25,
2008.  Based upon a review of the case file,. pleadings, exhibits, and testimony,
eligibility to occupy a public trust position is granted.
Procedural Rulings and Evidentiary Issues
Before the close of the hearing, Appellant requested leave to supplement the
record with documentation of addressing her listed debts.  For good cause shown,
Applicant was granted seven days to supplement the record.  The Government was
granted seven days to respond.  Within the time permitted, Applicant supplemented the
record with her documented entry into a credit counseling program and payment of the
required up-front fees to the counseling firm. Her post-hearing exhibit was admitted and
considered.  
Summary of Pleadings
Under Guideline F, Applicant is alleged to have (a) petitioned for Chapter 7
bankruptcy in April 2001 (discharged in July 2001) and (b) accumulated 27 debts
exceeding $32,000.00. 
Under Guideline E, Applicant is alleged to have falsified her security clearance
application (SF-85P) by understating her debts over 180 days delinquent when
responding to question 20 of the questionnaire. 
For her answer to the SOR, Applicant admitted her bankruptcy petition and
discharge, most of the listed debts, and her omissions.  She denied the allegations
covered by subparagraphs 1.e, 1.I, 1.p, 1.t, 1.x, and 1.y.  Applicant provided no
explanations for her answers.
Findings of Fact
Applicant is a 43-year-old intake representative for a defense contractor who
seeks a trustworthiness determination. The allegations covered in the SOR and
admitted by Applicant are adopted as relevant and material findings.  Additional findings
follow.
Applicant married in December 1995.  She has two children from this marriage:
ages 12 and 8 (see ex. 1; R.T., at 32).  She has permanent custody over both of her
children who reside with her.
Applicant was involved in an auto accident in 1996 that required a lengthy period
disability (R.T., at 44).  With little income from H to help her with household expenses
while she was on disability, Applicant could not keep up with her bills (R.T., at 44).  
Applicant first separated from her husband (H) in April 2002 and remained
separated for about two years (R.T., at 61).  She reconciled with H in September 2003
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for a brief two-month period before permanently separating in November 2003 (R.T., at
94-95).
Applicant petitioned for divorce from H in February 2004, and received her final
divorce decree in March 2006 (R.T., at 29).  H is currently on medical disability as a
result of an incident in which caused him post traumatic syndrome (R.T., at 30).  He
pays no child support and provides no financial assistance (R.T., at 32).  
During their marriage, Applicant and H accumulated a number of marital
obligations. With no financial help from H following their divorce, she fell behind on
these marital debts and defaulted.  Still unable to resolve these debts in 2001, she
petitioned for Chapter 7 bankruptcy in April 2001 (R.T., at 43).  The unsecured debts
she scheduled in her bankruptcy petition exceeded $15,000.00 (R.T., at 43).  With
virtually no assets to cover these debts, her bankruptcy petition became essentially a
no-asset case.  She received her bankruptcy discharge in July 2001.
Following her bankruptcy discharge, Applicant continued to struggle with her
debts.  She accumulated a number of debts between July 2001 and April 2008 that she
could not resolve with her limited resources and little support from H during their
marriage. Applicant’s listed delinquent debts (27 in all) exceed $32,000.00.  Some are
consumer-related and several involve traffic-related fines (R.T., at 49-50, 71-73). Her
consumer debts for the most part were jointly initiated during her marriage to H (R.T., at
37).
One of Applicant’s major listed debts represents a judgment taken against
Applicant and H for two months of back rent (totaling $4,527.00) on an apartment she
and her husband rented before their separation (R.T., at 76-77, 96-97).  Her marriage
with H in trouble, Applicant moved out of the apartment with her children in April 2002.
H, in turn, stayed behind in the apartment unit for several months before he, too,
vacated the premises (R.T., at 56-59).  Applicant acknowledged all but a few of the
listed debts that she attributes either to H or an unknown party (i.e., creditors 1.c, 1.I (a
likely duplicate of 1.h), 1.p, 1.t, 1.x, and 1.y).  
Following her separation from H, Applicant was involved in a car accident (in
2005) that prevented her from working for a period of time (R.T., at 31).  She struggled
thereafter to keep up with her bills with her limited income sources, and fell further
behind with her debts without any assistance from H.   
Concerned about her unresolved old debts, Applicant initially tried contacting  her
old creditors individually (R.T., at 65).  She had no success contacting them, and turned
to a credit counseling firm in 2007 for advice on how to address her delinquent debts
(R.T., at 26-28). Before signing up with this debt management firm, though, she
checked on their business standing with her state’s better business bureau (R.T., at 90-
91).  She assures she is able to meet her current monthly debts for necessities with her
$1,900.00 of net monthly income (R.T., at 41-42), and can handle monthly payments up
to $250.00 (R.T., at 28, 89-93).  Afforded an opportunity to supplement the record, she
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documented her executed agreement with the debt management firm she
communicated with, her start-up payment to the firm, and a sample letter to credit
reporting agencies (see ex. A).  Under the payment terms that Applicant arranged with
this firm, she will make monthly payments of $200.00.  With these funds, the debt
management firm will make pro rata payments to the creditors scheduled by Applicant
(ex. A) under a four-year payment plan (R.T., at 46-47).
Asked to complete an SF-85P application for a public trust position in September
2006, Applicant understated her delinquent debts (listing only a 2004 unpaid traffic fine)
when answering question 20 (see ex. 1).  Applicant assured she was only aware of
traffic debt when she answered question 20 (R.T., at 35, 99-102), and had never pulled
a credit report on herself (R.T., at 35).  Applicant did not intend to omit any delinquent
debts from her questionnaire (R.T., at 35-36, 102).  She admitted to falsifying her SF-
85P in the mistaken belief at the time she executed the questionnaire she had no debts
over 180 days delinquent (R.T., at 103).  In hindsight after seeing her credit report she
realizes she should have listed these other debts as well.  It was never her intent to
falsify her application or acknowledge any kind of deliberate falsification of her SF-85P
(R.T., at 103-05) when responding to the SOR.
While Applicant’s negative answers to question 20 of hers SF-85P do not reflect
any mention of possible delinquent debts (enforceable or otherwise) either in the
question blocs themselves, or in the space for additional comments in question 43, her
demonstrated overall honesty and voluntary acknowledgments of her debt
delinquencies in her SF-85P, in her SOR responses, and in her hearing testimony,
enable her on balance to avert any inferences of knowing and willful omission.  Given
the age of the debts at the time she completed the her SF-85P, and likely collection bar
of the debts in question under her state’s controlling statute of limitations, her omissions
have plausibility, and under all of the circumstances considered are accepted. 
Applicant assures she has received good performance appraisals and has
received promotions from her employer (R.T., at 33).  She claims to be well regarded by
her employer and is considered reliable and trustworthy.  She has never been cited for
any privacy infractions by her employer and never do anything that could adversely
impact her standing with her employer. 
Policies
The revised Adjudicative Guidelines for Determining Eligibility for Access to
Classified Information (effective September 2006) list Guidelines to be considered by
judges in the decision making process covering DOHA cases.  These Guidelines require
the judge to consider all of the "Conditions that could raise a security concern and may
be disqualifying” (Disqualifying Conditions), if any, and all of the "Mitigating Conditions,"
if any, before deciding whether or not a security clearance should be granted, continued
or denied.  The Guidelines do not require the judge to assess these factors exclusively
in arriving at a decision.  In addition to the relevant Adjudicative Guidelines, judges must
take into account the pertinent considerations for assessing extenuation and mitigation
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set forth in E.2.2 of the Adjudicative Process of Enclosure 2 of the Directive, which are
intended to assist the judges in reaching a fair and impartial common sense decision.
Viewing the issues raised and evidence as a whole, the following adjudication
policy factors are pertinent herein:
Financial Considerations
The Concern: “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.  Compulsive gambling is a concern as it may lead to financial
crimes including espionage.  Affluence that cannot be explained by known
sources of income is also a security concern.  It may indicate proceeds
from financially profitable criminal acts.”
Personal Conduct
The Concern: Conduct involving questionable judgment,
untrustworthiness, unreliability, 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.  AG ¶ 18.
Burden of Proof
By virtue of the precepts framed by the revised Adjudicative Guidelines, a
decision to grant or continue an applicant's security clearance may be made only upon
a threshold finding that to do so is clearly consistent with the national interest.  Because
the Directive requires Administrative Judges to make a common sense appraisal of the
evidence accumulated in the record, the ultimate determination of an applicant's
eligibility for a security clearance depends, in large part, on the relevance and
materiality of that evidence.  As with all adversary proceedings, the Judge may draw
only those inferences which have a reasonable and logical basis from the evidence of
record.  Conversely, the Judge cannot draw factual inferences that are grounded on
speculation or conjecture.
The Government's initial burden is twofold: (1) It must prove any controverted
fact[s] alleged in the Statement of Reasons and (2) it must demonstrate that the facts
proven have a material bearing  to the applicant's eligibility to obtain or maintain a
security clearance. The required showing of material bearing, however, does not require
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the Government to affirmatively demonstrate that the applicant has actually mishandled
or abused classified information before it can deny or revoke a security clearance.
Rather, consideration must take account of cognizable risks that an applicant may
deliberately or inadvertently fail to safeguard classified information.
Once the Government meets its initial burden of proof of establishing admitted or
controverted facts, the burden of persuasion shifts to the applicant for the purpose of
establishing his or her security worthiness through evidence of refutation, extenuation or
mitigation of the Government's case.
Analysis  
Applicant is an intake representative for a defense contractor who accumulated
numerous debts during periods of medical disability and divorce that imposed added
pressures on her fragile finances and parental responsibilities. With the limited
resources available to her, she has been able to keep up with her current household
expenses and debts, but not much more.  While she has heard nothing from her old
creditors in many years and is not the subject of any known collection action on her
debts, she remains committed to repaying her old debts and has engaged a credit
management firm to help her to address her debts.  Applicant’s finances and debt
omissions in her completed SF-85P raise initial security concerns as well.
Applicant’s finances
Security concerns are raised under the financial considerations guideline of the
Adjudicative Guidelines where the individual applicant is so financially overextended
that he or she is at risk of having to engage in illegal acts to generate funds.  Applicant’s
accumulation of delinquent debts, which heretofore she has not been in a position to
address, warrant the application of two of the disqualifying conditions (DC) of the
Adjudicative Guidelines for financial considerations: DC ¶ 19(a), “inability or
unwillingness to satisfy debts,” and DC ¶ 19(c) “a history of not meeting financial
obligations.”
Extenuating circumstances are associated with Applicant’s debts covered in her
discharged 2001 bankruptcy,  and in the ensuing years following her separation and
divorce, and medically-related disability associated with her accident   Due to  prolonged
periods of income shortages caused by a host of contributing factors (lack of financial
support from her husband during and after their marriage, significant parenting
responsibilities, disability caused by a 2006 traffic accident, and low-paying wages from
her current employment, Applicant has not been in a position to make any tangible
headway with any of her debts (disputed or otherwise).  MC ¶ 20(b) of the financial
considerations guideline  (the conditions that resulted in the behavior 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 responsibility) has some applicability to Applicant’ situation.
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Because of the limited income available to Applicant since her separation/divorce
and second accident, she has not heretofore been in a position to address her old debts
(disputed or otherwise).  Most of Applicant’s listed debts (exclusive of her judgment
debt) appear to have been placed in collection before 2004, and are likely barred by her
state’s controlling statute of limitations. None of Applicant’s listed medical and consumer
debts reflect any collection action by the individual creditors involved.   Based on this
record, most of Applicant’s covered debts appear to be barred from collection by the
pertinent four-year statute of limitation in Applicant’s state for written agreements. 
Statutes of limitation, while considered important policy tools for discouraging
plaintiffs from pursuing stale claims and promoting finality in litigation, have never been
equated with good-faith efforts to repay overdue creditors.  See, e.g., ISCR Case No.
02-30304, at 3 (App. Bd. April 2004)(quoting ISCR Case No. 99-9020, at 5-6 (App. Bd.
June 2001).   Still, they provide effective collection barriers and, like bankruptcy, serve
to insulate the debtor from pressures to raise cash to  satisfy his or her creditors.
To be sure, Applicant does not assert relevant statutes of limitation in her state in
her defense, and has committed to repaying her debts through a debt management firm.,
a commendable step considering that most of her debts are likely time-barred.  With her
limited income she has had past difficulty making individual or collective progress (such
as use of debt consolidation) on her listed debts.  She has since completed a debt
management agreement, received limited financial counseling, and tendered the
required $250.00 start-up fee to the debt management firm she enlisted. 
Based on Applicant’s recent but important first repayment steps, two additional
mitigating conditions have some application to Applicant’s situation: 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” and MC ¶ 20(d), “the
individual has initiated a good-faith effort to repay overdue creditors or otherwise resolve
debts.”   Based on Applicant’s credible disputes of several of the listed claims (possibly
H’s debts incurred after their legal separation), MC 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,” has some applicability as well relative
to the listed creditors she disputes. 
Holding a favorable trustworthiness determination involves the exercise of
important fiducial responsibilities, among which is the expectancy of consistent trust and
candor.   Financial stability in a person cleared to access information covered by privacy
rights is required precisely to inspire trust and confidence in the holder of the
trustworthiness determination. 
Both the applicable mitigating conditions of the financial guideline and whole
person assessment of Applicant’s financial problems and special circumstances as a
struggling parent who is addressing her old debts (despite available time bars for most of
the listed debts) conduce to dispel concerns about her reliability and trustworthiness.  
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Taking into account all of the extenuating facts and circumstances surrounding
Applicant’s debt accumulations, the limited resources she has had to address them with,
and the debt management services she has enlisted to address her debts, she mitigates
trustworthiness concerns related to her debts.  Favorable conclusions warrant with
respect to the allegations covered by the financial considerations guideline.
Personal Conduct issues associated with Appellant’s SF-85P 
Security concerns over Applicant’s judgment, reliability and trustworthiness are
raised under personal conduct guideline, too, as the result of her omissions of her debts
in the SF-85P she completed in September 2006.  By omitting her debts over 180 days
delinquent, Applicant failed to furnish materially important background information about
her debts that was needed for the Government to properly process and evaluate his
security clearance application. With the core policy concerns of the personal conduct
guideline (AG ¶15) being questionable judgment, lack of candor, dishonesty, or
unwillingness to comply with rules and regulations, initial security concerns are evident
under this guideline.
On the strength of her omissions alone, DC ¶ 16(a), “deliberate omission,
concealment, or falsification of relevant facts from any personnel security questionnaire,
personal history statement or similar form used to conduct investigations, determine
employment qualifications, award benefits or status, determine security clearance
eligibility or trustworthiness, or award fiduciary responsibilities,” applies.  While Applicant
cannot fully explain her understated debts, she probatively demonstrated that she did not
deliberately omit her debts when she responded affirmatively to question 20 of the SF-
85P.  MP ¶ 17(f), “the information was unsubstantiated or from a source of questionable
reliability,” is fully applicable to Applicant’s situation.
Overall, Applicant’s omission explanations are persuasive enough to warrant
conclusions the falsification allegations relative to her SF-85P omissions of her
delinquent debts are unsubstantiated.  Considering all of the evidence produced in this
record, favorable conclusions warrant with respect to the Guideline E allegations that
Applicant knowingly and wilfully omitted her SF-85P debts more than 180 days,
delinquent.
In reaching my decision, I have considered the evidence as a whole, including
each of the E2.2 factors enumerated in the Adjudicative Guidelines of the Directive.
Formal Findings
In reviewing the allegations of the SOR and ensuing conclusions reached in the
context of the findings of fact, conclusions, conditions, and the factors listed above, I
make the following formal findings:
GUIDELINE F: (FINANCIAL CONSIDERATIONS): FOR APPLICANT
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Sub-paras. 1.a through 1.bb: FOR APPLICANT
GUIDELINE E (PERSONAL CONDUCT): FOR APPLICANT 
Sub-para. 2.a: FOR APPLICANT
Conclusions
In light of all the circumstances presented by the record in this case, it is clearly
consistent with the national interest to grant or continue Applicant’s eligibility for a public
trust position.  Eligibility for an ADP I/II/III position is granted. 
                                          
Roger C. Wesley
Administrative Judge