1
                                                             
                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
------------------------ )       ISCR Case No. 08-04729
SSN: ---------------- )
)
Applicant for Security Clearance )
Appearances
For Government: 
Jeff Nagel, Esquire, Department Counsel
For Applicant:
Pro se
September 1, 2009
______________
Decision
______________
ROSS, Wilford H., Administrative Judge:
The Applicant submitted his Electronic Questionnaire for Investigations
Processing (e-QIP), on August 8, 2007 (Government Exhibit 1). On December 15, 2008,
the Defense Office of Hearings and Appeals (DOHA) issued a Statement of Reasons
(SOR) to the Applicant, which detailed security concerns under Guideline F stating why
DOHA could not make the preliminary affirmative finding under the Directive that it is
clearly consistent with the national interest to grant or continue a security clearance for
the Applicant, and recommended referral to an administrative judge to determine
whether a clearance should be denied or revoked. 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 President Bush
2
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 January 28, 2009, and requested a
decision without a hearing. Pursuant to Paragraph E3.1.7 of the Additional Procedural
Guidance at Enclosure 3 of the Directive, Department Counsel requested that a hearing
be held in this case. (Transcript at 9.) Department Counsel was prepared to proceed on
March 3, 2009. This case was assigned to me on March 5, 2009. DOHA issued a
notice of hearing on April 8, 2009. I convened the hearing as scheduled on May 19,
2009. The Government offered Government Exhibits 1 through 6, which were received
without objection. The Applicant testified on his own behalf, and submitted Applicant’s
Exhibits A through E, also without objection. The record was left open at the Applicant’s
request for the submission of additional documentation. The Applicant submitted
Applicant’s Exhibit F on or about June 2, 2009. This exhibit was also received without
objection. DOHA received the transcript of the hearing on May 27, 2009. The record
closed on June 2, 2009. 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 35, married but separated, and is a high school graduate. He
seeks a security clearance in connection with his employment in the defense industry.
In his Answer to the SOR, Applicant admitted the allegations in Paragraph 1 of the
SOR. Those admissions are hereby deemed findings of fact.
Paragraph 1 (Guideline F - Financial Considerations)
The Government alleges that the Applicant is ineligible for clearance because he
in financially overextended and therefore at risk of engaging in illegal acts to obtain
funds.
The Applicant served about 13 years in the military. He first was an enlisted man
in the Marine Corps for seven years, then served for five years as a warrant officer pilot
in the Army. He received a medical discharge in 2005 for service connected, non-
combat, injuries. (Transcript at 33-35.) 
The Applicant left active duty in May 2005, very soon after his medical discharge
was approved. By the Applicant’s own admission, he did not have sufficient time to
prepare himself or his family for his return to civilian life, which included moving from an
overseas location back to the United States.  (Transcript at 35-36.)
Once he returned to the United States in May 2005, the Applicant was unable to
obtain consistent full-time employment until February 2007. At that time he began
working for his current employer. He has been employed by this company continually
since that time. (Transcript at 36-38; Government Exhibit 1 at Section 11, and Exhibit 2.)
See Transcript at 42-43.1
3
Subparagraph 1.a. concerns the Applicant filing for bankruptcy. By the summer
of 2008, the Applicant reached a financial state where he could examine all of his
options regarding his past due debt.  He testified:
I initially wanted to do credit counseling to see if I could fix myself
that way, my wife and I. It wasn’t – it wouldn’t have worked, so we went
through some counseling prior to bankruptcy and it looked like that was
the avenue. And I actually took a few more months trying to make that
decision before I did it. I did it. And it was discharged in February [2009].
(Transcript at 38.)1
The available records show that the Applicant filed a Chapter 7 bankruptcy in
November 2008. (Government Exhibit 6 at 1.) He was granted a discharge on February
18, 2009. (Applicant’s Exhibit E at 2.) The Applicant submitted the Schedule F -
Creditors Holding Unsecured Nonpriority Claims from his bankruptcy petition.
(Applicant’s Exhibit E at 3-6.) The debts alleged in subparagraphs 1.b through 1.y. of
the SOR were included in the schedule. These debts have been discharged and the
Applicant no longer has responsibility for them.
The Applicant also submitted the Schedule E - Creditors Holding Secured
Nonpriority Claims. (Applicant’s Exhibit D at 1-2.) The debts alleged in subparagraphs
1.z. and 1.aa. are included on this schedule.  They are nondischargeable in bankruptcy.
The Applicant submitted evidence that these governmental claims are being paid
through application of his tax refunds from the years 2005, 2006 and 2007. (Transcript
at 58-61; Applicant’s Exhibits A and B.)  
The debts set forth in subparagraphs 1.bb. and 1.cc. are not included in the
Applicant’s bankruptcy petition.  Both debts precede the date of the petition and their
absence appears to be an oversight.  Under bankruptcy rules, even though these debts
are not included in the schedules, as unsecured nonpriority debts they are still
discharged. (11 U.S.C. § 727.) (Transcript at 44, 56-57.)
The Applicant testified that he is able to maintain payments on his current debts
now that he has been discharged in bankruptcy. This includes his child support
responsibilities. He has taken credit counseling, and is working with a certified public
accountant to get his financial situation in order. (Transcript at 50-51; Government
Exhibit 2 at 12.) 
Mitigation
The Applicant submitted a written recommendation from his supervisor. This
person describes the Applicant as a person of “Integrity and sound judgment.”
(Applicant’s Exhibit F.)
4
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 overarching
adjudicative goal is a fair, impartial, and commonsense 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. 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.
 
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
5
applicant concerned.” See also EO 12968, Section 3.1(b) (listing multiple prerequisites
for access to classified or sensitive information). 
Analysis
It is the Government's responsibility to present substantial evidence to support
the finding of a nexus, or rational connection, between the Applicant's conduct and the
continued holding of a security clearance.  If such a case has been established, the
burden then shifts to the Applicant to go forward with evidence in rebuttal, explanation
or mitigation which is sufficient to overcome or outweigh the Government's case.  The
Applicant bears the ultimate burden of persuasion in proving that it is clearly consistent
with the national interest to grant him or her a security clearance.
In this case, the Government has met its initial burden of proving by substantial
evidence that the Applicant has had financial difficulties (Guideline F). The Applicant, on
the other hand, has successfully mitigated the Government's case.
Paragraph 1 (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.  The Applicant failed to pay a series of debts for a period of years.
The evidence is sufficient to raise these potentially disqualifying conditions, requiring a
closer examination.
The guideline also includes examples of conditions that could mitigate security
concerns arising from financial difficulties.  Mitigating Condition ¶ 20(a) states that the
disqualifying conditions 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.”  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 . . ., or a death, divorce or separation), and the individual acted responsibly
under the circumstances.”  The Applicant’s debt situation was seriously impacted by his
6
medical discharge from the Army, and the period of underemployment that followed it.
The evidence raises these mitigating conditions. 
The Applicant’s debts have been discharged in a Chapter 7 bankruptcy.  This
conduct is mitigating under two conditions. He has obtained the required credit
counseling, and is working with a certified public accountant on a spending plan.
Accordingly, AG ¶ 20(c) applies, which states that it is mitigating where “the person has
received or is receiving counseling for the problem . . . .” In addition, under the facts of
this case, the bankruptcy shows that “the individual initiated a good-faith effort to repay
overdue creditors or otherwise resolve debts” under ¶ 20(d). 
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. 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. The administrative judge should consider the nine adjudicative process factors
listed at AG ¶ 2(a) in making such a determination: 
(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. 
I considered the potentially disqualifying and mitigating conditions in light of all
the facts and circumstances surrounding this case, in particular the Applicant allowing
these debts to lie fallow for several years, his medical discharge from the Army, which
prevented him from properly preparing to enter the civilian workforce, his decision to file
a Chapter 7 bankruptcy, and his ability to maintain his current debts. Three of the
factors have the most impact on this case.  First, I find that there is the “presence or
absence of rehabilitation and other permanent behavioral changes,” as set forth under
AG ¶ 2(a)(6). The Applicant has shown that his failure to pay these debts was a
temporary situation that has been corrected. Under the particular facts of this case,
there is little or no “potential for pressure, coercion, exploitation, or duress” as set forth
in AG ¶ 2(a)(8). Finally, the evidence does not show a “likelihood of continuation or
recurrence” of the conduct as discussed in AG ¶ 2(a)(9). 
On balance, it is concluded that the Applicant has successfully overcome the
Government's case opposing his request for a DoD security clearance. Accordingly, the
7
evidence supports a finding for the Applicant as to the factual and conclusionary
allegations expressed in Paragraph 1 of the Government's Statement of Reasons.
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.cc: For the Applicant
Conclusion
In light of all of the circumstances presented by the record in this case, it is
clearly consistent with national interest to grant Applicant eligibility for a security
clearance.  Eligibility for access to classified information is granted.
                                              
WILFORD H. ROSS
Administrative Judge