DEPARTMENT OF DEFENSE 
         DEFENSE OFFICE OF HEARINGS AND APPEALS 
           
             
 
 
In the matter of: ) 
 ) 
  )  ISCR Case No. 08-09141 
            ) 
 ) 
Applicant for Security Clearance ) 
 
 
Appearances 
 
For Government: Eric H. Borgstrom, Esquire, Department Counsel 
For Applicant: Pro Se 
 
 
______________ 
 
Decision 
______________ 
 
CREAN, Thomas M., Administrative Judge: 
 
Applicant submitted an Electronic Questionnaires for Investigations Processing 
(e-QIP) May 14, 2008, as a requirement for his employment with a defense contractor 
(Item 5). On February 18, 2009, the Defense Office of Hearings and Appeals (DOHA) 
issued a Statement of Reasons (SOR) to Applicant detailing security concerns for 
financial considerations under Guideline F (Item 1). 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 acknowledged receipt of the SOR on March 
26, 2009. 
 
 Applicant answered the SOR in writing on both April 22, 2009 (Item 2), and June 
24, 2009 (Item 3). Applicant denied the first allegation (SOR 1.a), but admitted the 
second allegation (SOR 1.b). He provided an explanation for his answers and attached 
a receipt for payment of the debt listed at SOR 1.a. Applicant did not indicate in his 
response whether he wanted the case decided on the record or in a hearing before an 
 
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administrative judge. On August 7, 2009, he elected to have the matter decided on the 
written record in lieu of a hearing (Item 4). Department Counsel submitted the 
Government’s written case on August 19, 2009. On September 4, 2009, Applicant 
received a complete file of relevant material (FORM), and was provided the opportunity 
to file objections, and submit material to refute, extenuate, or mitigate the disqualifying 
conditions. Applicant did not provide additional material. The case was assigned to me 
on November 9, 2009. Based on a review of the case file and pleadings, eligibility for 
access to classified information is granted. 
 
Findings of Fact 
 
 I thoroughly reviewed the case file, and the pleadings. I make the following 
findings of fact. 
 
Applicant is 59 years old and has been employed as an equipment repair 
mechanic for a defense contractor for over 31 years. He has been married for over 40 
years and has three adult children. He has held a security clearance for at least ten 
years (Item 5, e-QIP, dated May 14, 2008). In response to Interrogatories from security 
adjudicators, Applicant provided a personal financial statement. He reported monthly 
income of $5,391.36, verified by an earnings statement from his employer (Item 6 at 4). 
He has monthly recurring expenses of $1,641.89. The mortgage on his house is paid, 
so he reports additional monthly expense of $795.38 for property taxes, homeowner's 
insurance, and a car payment. He has a net monthly remainder of $2,954.09. He listed 
assets of $322,300, for the equity in his house, savings bonds, and stock (Item 6).  
 
Credit reports (Item 7, Credit report, dated July 15, 2009; Item 8, Credit report, 
dated February 6, 2009; Item 9, Credit report, dated November 17, 2008; Item 10, 
Credit report, dated May 28, 2008) show a charged off delinquent debt for $48,000 
(SOR 1.a), and a house foreclosure on a mortgage default of $187,000 (SOR 1.b). 
There is no indication in the file of the origin of the debt at SOR 1.a. Applicant provided 
a receipt showing that the debt was settled for $4,801.11 and paid. The debt is not listed 
on the latest credit report (Item 7). Applicant's house, that he lived in for over 30 years, 
is mortgage free having been paid in full. Applicant states that the mortgage in SOR 1.b 
is for his son's house. Applicant co-signed the mortgage on the house for his son. His 
son was not able to continue to make the mortgage payments so it will be foreclosed. 
Applicant also stated that his son was negotiating with the lender for a more affordable 
mortgage (Items 2 and 3). 
 
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. 
 
 
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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 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. 
 
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. 
 
Analysis 
 
Financial Considerations: 
 
 Under financial considerations, 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 (AG ¶ 18). Similarly, an individual who is financially 
irresponsible may also be irresponsible, unconcerned, or careless in their obligations to 
protect classified information. Behaving responsibly or irresponsibly in one aspect of life 
provides an indication of how a person may behave in other aspects of life.  
 
 
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 A person’s relationship with his creditors is a private matter until evidence is 
uncovered demonstrating an inability or unwillingness to repay debts under agreed 
terms. Absent evidence of strong extenuating or mitigating circumstances, an applicant 
with a history of serious or recurring financial difficulties is in a situation of risk 
inconsistent with the holding of a security clearance. An applicant is not required to be 
debt free, but is required to manage his finances in such a way as to meet his financial 
obligations. Applicant’s two delinquent debts reported in credit reports raise Financial 
Considerations Disqualifying Conditions (FC DC) AG ¶ 19(a) (inability or unwillingness 
to satisfy debts); and FC DC AG ¶ 19(c) (a history of not meeting financial obligations). 
 
 I considered Financial Considerations Mitigating Conditions (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); and FC MC ¶ 20(b) (the 
conditions that resulted in the financial problems 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).There are only two delinquent debts for Applicant listed in 
credit reports. Even though there is no indication of the origin of the debt at SOR 1.a, 
Applicant has provided sufficient information to establish that this debt is settled and 
paid. The debt at SOR 1.b is attributed to Applicant because he co-signed for his son's 
mortgage and the son defaulted. This event will not likely recur since Applicant's co-
signing the mortgage was a one time event. Applicant acted responsibly towards his 
personal finances. He paid all debts directly attributed to him, and pays his present 
debts as agreed. He has a significant savings safety net. 
 
 I considered FC MC AG ¶ 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). There is no indication Applicant received financial 
counseling or that he even needed financial counseling. However, he does not have a 
financial problem since his finances are under control. 
 
 I considered FC MC ¶ 20(d) "the individual has initiated a good-faith effort to 
repay any overdue creditors or otherwise resolve debts". Applicant has no debt except 
for the mortgage attributed to him because he co-signed his son's mortgage. A 
systematic, concrete method of handling debts is needed. Good-faith means acting in a 
way that shows reasonableness, prudence, honesty, and adherence to duty or 
obligation. Applicant presented information to show that his management of his 
personal finances is reasonable, prudent, and honest. He has managed his finances in 
an excellent fashion that he has no debt except for his financial liability from his desire 
to assist his son by co-signing a mortgage for his son. Applicant presented sufficient 
information to establish he is making a good-faith effort to pay creditors and resolve his 
debts. His finances are under control and he acted reasonably and responsibly in 
regard to his finances. He mitigated security concerns for financial considerations. 
 
 
 
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Whole Person Analysis  
 
 Under the whole person concept, the administrative judge must evaluate an 
applicant’s security eligibility by considering the totality of the applicant’s conduct and all 
the circumstances. An 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. 
 
Under AG ¶ 2(c), the ultimate determination of whether to grant a security clearance 
must be an overall commonsense judgment based upon careful consideration of the 
guidelines and the whole person concept.  
 
Appellant has to show a "meaningful track record" of debt payment, including 
evidence of actual debt reduction through payment of debts. All that is required is that 
he has a plan to resolve his financial problems and takes significant action to implement 
that plan. The entirety of his financial situation and his actions can reasonably be 
considered in evaluating the extent to which his plan to reduce his outstanding 
indebtedness is credible and realistic. Available, reliable information about the person's 
behavior, past and present, favorable and unfavorable, should be considered in 
reaching a determination.  
 
Applicant established a "meaningful track record" of debt payment by presenting 
sufficient information to show he is current with his debts except for one that is basically 
a debt for his son. He is taking sufficient, consistent, reasonable, and responsible action 
to properly manage his finances. He basically has no debt except for one debt more 
attributed to his son than to him. Applicant demonstrated by his lack of personal debt 
reasonable and responsible management of his finances. It is apparent Applicant has a 
debt for the co-signed mortgage that he must resolve with mortgage creditor. The fact 
he has this debt does not show he should not be granted access to classified 
information. The circumstance of this debt does not indicate Applicant's finances show 
poor self-control, lack of judgment, or unwillingness to abide by rules and regulations. 
Applicant lived within his means for many years as indicated by the facts he has no 
delinquent debt and has substantial discretionary funds available each month. He paid 
off the mortgage on his own house and accumulated a savings in the form of stocks and 
bonds. Applicant's overall financial picture shows he does meet his financial obligations. 
The way he managed his finances over the years indicates that he will be concerned, 
responsible, and not careless in regard to classified information. Overall, the record 
evidence leaves me with no questions or doubts as to Applicant’s judgment, reliability, 
 
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and trustworthiness. He established that he is suitable for a security clearance. For all 
these reasons, I conclude Appellant has mitigated the security concerns arising from his 
financial situation. Clearance is granted. 
 
Formal Findings 
 
 Paragraph 1, Guideline F:   FOR APPLICANT 
 
  Subparagraph 1.a:   For Applicant  
  Subparagraph 1.b:   For 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. 
 
 
 
_________________ 
THOMAS M. CREAN 
Administrative Judge