1
                                                             
                           
                        DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)       ISCR Case No. 08-05764
SSN: )
)
Applicant for Security Clearance )
Appearances
For Government: Richard A. Stevens, Esq., Department Counsel
For Applicant: Michael D. Moore, Esq.
                                                                            
______________
Decision
______________
MARSHALL, Jr., Arthur E., Administrative Judge:
Based upon a review of the testimony, submissions, and exhibits, I find Applicant
failed to meet his burden regarding the security concerns raised. Security clearance is
denied.
Applicant completed a security clearance application (SF-86) dated October 19,
2007. On October 31, 2008, the Defense Office of Hearings and Appeals (DOHA)
issued a Statement of Reasons (SOR) enumerating security concerns arising under
Guideline F (Financial Considerations). 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 for SORs issued after September 1, 2006. 
In a response dated January 13, 2009, Applicant admitted 18 of the 19
allegations noted in the SOR and requested a hearing. The matter was referred to
 Tr. 67-68.      1
 Tr. 21.      2
 Tr. 25.      3
 Tr. 25-27.      4
 Tr. 27-28.      5
2
DOHA on March 4, 2009, and the case was assigned to me that day. Department
Counsel and Applicant agreed to a hearing date of April 30, 2009. A notice of hearing
was issued to that effect on April 1, 2009. I was unable to timely convene the hearing
as scheduled and the hearing was rescheduled for May 7, 2009, without objection. I
convened the hearing as scheduled. Applicant was represented by counsel. Applicant
gave testimony and offered one document which was admitted without objection as
exhibit (Ex.) A. Department Counsel offered seven documents admitted as Exs. 1-7
without objection. Applicant was given through May 18, 2009, to supplement the record
with any additional materials and to substitute a copy for the original document offered
as Ex. A. On May 18, 2009, I closed the record. On May 19, 2009, Applicant’s attorney
sent Department Counsel a facsimile transmission copy of what was previously marked
as Ex. A. On June 22, 2009, Department Counsel forwarded that document to me,
noting he had no objection to it being admitted into the record. On that same day, I
reopened the record, admitted the document, and then again closed the record. In the
interim, the transcript (Tr.) of the proceeding was received on May 21, 2009.
Findings of Fact
Applicant is a 30-year-old supervisory electronics technician working for a
defense contractor. He has worked for the same employer for a little over two years.
Applicant has approximately eight years of military service and has attended some
college. Currently separated from his wife, Applicant has custody of their two minor
children. He also has a third minor child for whom he pays regular child support.
Applicant has not received financial counseling.
In 1996, Applicant joined the military following completion of high school. He
enjoyed solid credit and lived within his means for several years thereafter. He married
in December 1998 and he received a military discharge in June 2004.  Soon thereafter,1
he fell into a “rut” and failed to keep himself “neat and tidy.”  Meanwhile, he and his wife2
experienced marital problems that began as he served overseas while his wife
remained in the United States and oversaw their finances.  Unbeknownst to Applicant,3
his wife did not pay some of their bills, causing them to become delinquent.  She4
continued to conceal her non-payment of the bills even after the couple separated in
July 2005.  Shortly thereafter, Applicant moved in with his mother. He then moved in5
with his father in 2006 with plans to work for one of his father’s colleagues. Applicant
 Tr. 30.      6
 Tr. 76.      7
 Tr. 32.      8
 Tr. 36.      9
 Ex. A (Satisfaction of Judgment); Tr. 37-46. Although caught up on his arrearage, Applicant is still under      10
a court order to provide child support for the two children who have since come to reside with him. Given this
change in circumstances, he is now trying to petition the court to end such payments for these two children.
Tr. 48. He is also liable for child support for his third child, the existence of whom he first discovered in
February 2008. Child support and a retroactive arrearage is being paid through garnishment or wage
withholding. Tr. 76-78.
 Answer to the SOR, dated January 13, 2009.      11
 Tr. 87.      12
3
failed to leave forwarding addresses when he moved. Consequently, he received no
correspondence from creditors reflecting balances owed.  6
In the interim, Applicant faced a period of unemployment from November 2006
through April 2007 after his father’s colleague lost his business. In July 2007, following
his divorce, Applicant won custody of his two children from his now ex-wife.  7
Applicant remained unaware that he had any delinquent debts until after he
submitted his security clearance application in late 2007. He first became aware of
these debts at some point between his application date and his receipt of the SOR in
2008. Had he learned of his debt earlier, he would not have had the financial resources
to pay these debts and still meet his regular expenses and child support obligations.8
Since learning of their existence, he has contemplated various methods of addressing
his debt. Before the hearing, Applicant consulted with a bankruptcy attorney. Applicant
and the bankruptcy attorney are presently preparing a Chapter 7 bankruptcy filing. That
attorney advised him to make no payments on his debts until the filing has been made
so as not to demonstrate an illegal preference for individual creditors.  The SOR9
enumerates 19 delinquent accounts, amounting to about $30,000 in debt. The only debt
he has addressed is the child support obligation for approximately $786 noted in
allegation ¶ 1.r.  He also disputes the $3 obligation noted in allegation ¶ 1.l, which he10
claims, without evidence, is no longer reflected on his credit report.11
Currently, Applicant earns an approximate net salary of $1,000 a month after
withholding and child support payments. He and his children live simply. Applicant pays
a nominal rent of $250 a month to a couple with whom he and his two children live. This
rent includes utilities. Applicant has no car payment, but pays about $86 a month for car
insurance and about $200 a month for gasoline. About $120 a month is spent on after-
school programs for the children. Groceries cost about $100 a month while about $50 a
month is spent on clothing. Applicant no longer has any credit cards. He has no loans
or debts other than those noted in the SOR.  Applicant does not maintain a savings12
 Tr. 88.      13
 See also ISCR Case No. 94-1075 at 3-4 (App. Bd. Aug. 10, 1995).      14
 Department of the Navy v. Egan, 484 U.S. 518, 531 (1988).      15
 ISCR Case No. 93-1390 at 7-8 (App. Bd. Jan. 27, 1995).      16
4
account. At the end of the month, Applicant has about $50 left after payment of all
current obligations.  At work, Applicant is a valued employee. His employer is willing to13
work with him as he resolves his financial issues. He recently received a significant
promotion and raise in salary that should help his future finances. 
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. 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. Under AG ¶ 2(c), this 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.
The government must present evidence to establish controverted facts alleged in
the SOR. An 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 burden of proof is something less than a14
preponderance of evidence.  The ultimate burden of persuasion is on the applicant.  15 16
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 an applicant may deliberately or inadvertently fail to protect or
safeguard classified information. Such decisions entail a certain degree of legally
 Id.      17
 Id.      18
 Executive Order 10865 § 7.      19
 Revised Adjudicative Guideline (AG) ¶ 18.      20
5
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). “The clearly consistent standard
indicates that security clearance determinations should err, if they must, on the side of
denials.”  Any reasonable doubt about whether an applicant should be allowed access17
to sensitive information must be resolved in favor of protecting such sensitive
information.  The decision to deny an individual a security clearance is not necessarily18
a determination as to the loyalty of an applicant.  It is merely an indication that the19
applicant has not met the strict guidelines the President and the Secretary of Defense
have established for issuing a clearance.
Based upon consideration of the evidence, I find Guideline F (Financial
Considerations) to be the most pertinent to the case. Conditions pertaining to this
adjudicative guideline that could raise a security concern and may be disqualifying, as
well as those which would mitigate such concerns, are set forth and discussed below.
Analysis
Guideline F – Financial Considerations
Under Guideline F, failure or an inability to live within one’s means, satisfy debts,
and meet financial obligations may indicate poor self-control, lack of judgment, or an
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.20
The Directive sets out several potentially disqualifying conditions under this guideline. 
Applicant acquired a number of delinquent debts when his wife mismanaged his
finances. To date, those debts continue to remain largely unaddressed. Financial
Considerations Disqualifying Condition (FC DC) AG ¶ 19(a) (“inability or unwillingness
to satisfy debts”) and FC DC AG ¶ 9(c) (“a history of not meeting financial obligations”)
apply. With such conditions raised, the burden shifts to Applicant to overcome the case
against him and mitigate security concerns. 
Applicant’s ex-wife purposefully or negligently mismanaged Applicant’s finances.
Nothing prevented him, however, from casually inquiring about his finances when they
6
were together, personally assessing his financial status when he resumed control of his
finances after their separation, or having his mail forwarded when he moved so he
could receive account and business correspondence. Such actions could have
demonstrated responsible behavior despite Applicant’s ex-wife’s mismanagement.
Financial Considerations Mitigating Condition (FC MC) AG ¶ 20(b) (“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 responsibly under the circumstances”) does not
apply. 
The acquisition of Applicant’s debt occurred while his ex-wife managed
Applicant’s finances and he expressed no interest in their status. He was later
neglectful of his accounts after his separation. To date, only a delinquent balance of
approximately $800 has been paid from a list of 19 delinquent accounts representing
about $30,000 in delinquent debt. The rest of the delinquent accounts remain
unaddressed. Today, he is attempting to resolve his debts through bankruptcy, but has,
thus far, not received financial counseling that might give some assurance he has the
tools to manage his finances in the future. Given these facts, neither FC MC AG ¶ 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”) nor FC MC ¶ 20(d) (“the individual
initiated a good-faith effort to repay overdue creditors or otherwise resolve debts”)
applies. With regard to the planned Chapter 7 bankruptcy action, he has yet to submit a
petition to the bankruptcy court. Taken in conjunction with his failure to receive financial
counseling or otherwise address his remaining debts, 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”) does not apply. No other
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) the 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. 
7
Under AG ¶ 2(c), the ultimate determination of whether to grant 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, as well as the “whole person”
factors. Speaking in Applicant’s favor is his highly credible testimony and his devotion to
his children. He responsibly took custody of two of his children and has been financially
responsible toward a child he only recently discovered was his. At work, he is a valued
employee who has earned his employer’s trust. Moreover, his testimony makes it clear
that is was not an unwillingness, but an inability, to honor his debts that precluded him
from previously addressing them. 
Speaking against Applicant, however, is the complete and unfettered reliance he
placed on his former wife to properly manage his accounts and his failure to monitor her
efforts in any manner. Applicant was equally neglectful in failing to seize control of his
finances, review their status, and leave forwarding addresses for his creditors, both
when he became estranged from his ex-wife and thereafter. As a result of this neglect
and his lack of sufficient funds, Applicant has only addressed a $786 debt. Moreover,
aside from payment of that one obligation, Applicant’s only significant action toward
resolving his debts occurred shortly before the hearing, when he retained a bankruptcy
attorney for a proposed bankruptcy. A successful bankruptcy discharge may
demonstrate a legally valid method for resolving one’s debts. By itself, however,
testimony that a bankruptcy petition is being prepared does not mitigate financial
security concerns. 
As noted previously, any reasonable doubt about whether an applicant should be
allowed access to sensitive information must be resolved in favor of protecting such
sensitive information. The decision to deny an individual a security clearance is not
necessarily a determination as to the loyalty of an applicant, but merely an indication
that the applicant has not met the strict guidelines established for issuing a clearance.
Here, Applicant has demonstrated a present inability to pay his debts, scant effort to
manage his delinquent debts, and little concrete progress toward their resolution. With
security concerns regarding his finances unmitigated, I conclude it is not clearly
consistent with national security to grant Applicant a security clearance. Clearance is
denied. 
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
8
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
Subparagraph 1.p Against Applicant
Subparagraph 1.q: Against Applicant
Subparagraph 1.r: For Applicant
Subparagraph 1.s: 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 a security clearance.
Clearance is denied.
ARTHUR E. MARSHALL, JR.
Administrative Judge