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                        DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)       ISCR Case No. 09-02084
SSN: )
)
Applicant for Security Clearance )
Appearances
For Government: Fahryn Hoffman, Esq., Department Counsel
For Applicant: Pro Se
                                                                            
______________
Decision
______________
MARSHALL, Jr., Arthur E., Administrative Judge:
Applicant completed a security clearance application (SF-86) on December 1,
2008. On June 11, 2009, 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,
which are effective for SORs issued after September 1, 2006. 
In a response dated July 12, 2009, Applicant admitted the two allegations set
forth in the SOR and requested a hearing on the record. DOHA assigned the case to
me on October 7, 2009. The parties agreed to a hearing date of October 23, 2009. A
notice of hearing was issued to that effect on October 7, 2009. The hearing was
convened as scheduled. Department Counsel introduced five documents accepted into
the record without objection as exhibits (Exs.) 1-5. Applicant chose to represent himself,
gave testimony, and was examined by Department Counsel. Applicant offered 13
documents which were accepted into the record without objection as Exs. A-O. The
 Tr. 17-18.      1
 Tr. 64-65.      2
 Tr. 18, 67.      3
 Tr. 67.      4
 Tr. 65-66. Applicant still suffers from recurring knee and back problems. Tr. 68, 80.      5
 After being shot in the line of duty in 1988 and receiving extensive medical treatment, Applicant retired      6
from this job in November 1991. Tr. 35.
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transcript (Tr.) of the proceeding was received on October 29, 2009. Applicant was
given until November 9, 2009, to submit any additional documents. Five documents
were timely submitted and accepted into the record as Exs. P-T without objection. The
record was closed on November 13, 2009. Based on a review of the testimony,
submissions, and exhibits, I find Applicant met his burden regarding the financial
considerations security concerns raised. Security clearance is granted.
Findings of Fact
Applicant is a 59-year-old forensic photographer working for a defense
contractor. He has worked for the same employer for one year. Prior to his current
position, he worked for a sheriff’s department’s crime team unit as its supervisor. In
total, Applicant has over 30 years of law enforcement experience. Applicant has
completed some college-level course work. He is married and has three grown children.
In early 2006, Applicant suffered from a back injury incurred on the job.  He1
suffered from two other injuries shortly thereafter.  Despite medical attention received2
between 2006 and 2008, which also included two shoulder surgeries, Applicant was left
in a weakened condition.  Lumbar problems affected his ability to “get up and go to3
work.”  Because of his physical problems and a developing friction with his new4
supervisor, he decided to retire in November 2007. He accepted a lump sum retirement
payment.  Having started work on a sideline job involving the sale of subscriptions for5
pre-paid legal services, Applicant decided he would devote his energies to that
enterprise from home. The downturn in the economy, however, forced him to
reconsider his decision. After discussing the matter with a financial advisor, he returned
to the work force in November 2008 in a position located in another part of the country.
In the interim, Applicant and his wife relied on the proceeds of a medical retirement
fund for which he was eligible due to a previous work-related injury incurred during a
1988 shooting.  They also relied on his wife’s income as a surgical assistant.6
Additionally, they supported themselves on their credit cards, some of which eventually
reached their maximum limits. 
In August 2008, Applicant contacted his mortgagor. He asked for a home loan
modification because he did not want his worsening economic status to adversely
 Tr. 60-61.      7
 Tr. 61-62.      8
 Tr. 62.      9
 SOR allegation ¶ 1.a; Tr. 20.      10
 During the periods of deferral, Applicant was “given a little breathing room,” but not “absolved” of making      11
monthly payments. Tr. 73.
 Tr. 21, 75.      12
 Id., Tr. 74.      13
 Tr. 38.      14
 Exs. C-I (Correspondence regarding home loan); Tr. 26-27, 30-32, 75.      15
 SOR allegation ¶ 1.b; Tr. 22.      16
 Tr. 22.      17
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impact either his credit or the home loan.  On September 10, 2008, he wrote to his7
lender explaining his circumstances and asking for a reduction in his monthly payment,
but he received no response.  A similar letter was sent on November 4, 2008.  Because8 9
he had never been delinquent in the past, the mortgagor declined to work with him. In
the interim, a past due balance of approximately $19,718 accrued when Applicant could
not make his monthly payments in October, November, and December of 2008.  10
In October or November 2008, Applicant requested his attorney to intercede on
his behalf with the home loan’s servicing company. Applicant returned to work in
November 2008, adjusting to his transcontinental commute and its expense. By
January 2009, an agreement was arranged by his attorney with his home loan lender.
Applicant made payments in February, March, and April 2009, at which time they began
a loan modification program. In June or July of 2009, the lender advised Applicant his
payments would be deferred thereafter until the end of the loan modification.11
Heightened payments of approximately $4,000 a month resumed in September,
October, and November 2009, at which point Applicant’s payments will again be
deferred. Thus far, the lender has amended his loan terms, nullified a prior demand for
a balloon payment, continued the loan on a 25-year repayment term, and reduced his
interest rate from 6.7% to 5%.  If accepted into a new federal government program, for12
which Applicant has been told he qualifies, that percentage rate may be further reduced
to 2%.  At the time of the hearing, Applicant’s loan was temporarily in forbearance as13
part of the restructuring plan.  He is currently in compliance with his lender’s terms and14
is in “constant contact” with the lender.15
During this same time period, Applicant became $322 past due on a credit
card.  When informed he had a balance on the account at issue, he asked his wife16
about it. She informed him that the card noted in the SOR was her card. He told her,
“whatever it is just take it and pay it off, and she did just that.”  The account was shown17
 Exs. A (Letter dated Mar. 12, 2009), B (Statement of Jul 2009), and R (Statements from Apr. through Oct.      18
2009); Tr 23-24.
 Tr. 56.      19
 Tr. 25.      20
 Ex. Q (Financial advisor statement); Tr. 117-118.      21
 Ex. J (Earnings Statement); Tr. 35, 78.      22
 Tr. 35.      23
 Tr. 27.      24
 Tr. 119.      25
 Tr. 54. It is unclear whether this sum includes the income generated by Applicant’s sideline business.      26
 Tr. 71.      27
 Applicant described his past financial condition as: “Yes, we had very good credit, we had excellent      28
credit.” Tr. 59.
 Tr. 55-56.      29
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to be currently up-to-date and is no longer past due.  Payments on the remaining18
balance exceed the minimum payment due.  Consequently, he has addressed both the19
accounts at issue in the SOR.20
Although Applicant has not received formal financial counseling in a structured
classroom setting, Applicant has a financial advisor, whom he has consulted regarding
his finances.  He currently earns a net salary of approximately $2,600 every two21
weeks.  He is paid approximately $1,928 each month in the form of a tax-free disability22
payment from the state related to his shooting.  His wife currently earns a net salary of23
about $1,500 every two weeks.  In addition, Applicant’s pre-paid legal services work24
currently generates an extra sum of approximately $220 per month.  All together,25
Applicant and his wife have net monthly income amounting to a sum of approximately
$10,500 per month.  26
Applicant’s home valuation recently suffered as a result of a real estate market
downturn. His home is located in a part of the country known for high real estate values.
It suffered a considerable drop in values. Once appraised at approximately $875,000,
his home is now assessed at $541,00 with a fair market value of $395,000.  27
Applicant and his wife have approximately 16 credit cards or accounts. They
were acquired when their credit was in very good shape and his finances were current,
prior to his retirement and the economic downturn.  Some of those cards reflect the28
higher interest rates recently raised by many credit card companies.  Applicant’s wife29
has worked on negotiating with some of their creditors to have their interest rates
 Tr. 55.      30
 See, e.g., Tr. 92-103, 108.      31
 Tr. 103.      32
 Tr. 111.      33
 See, e.g., Tr. 20, 54.      34
 Tr. 105.      35
 Tr. 106-107, 109, 120. Applicant estimated his net remainder as being closer to $1,600. Department      36
Counsel estimated it was about $750. It appears to be closer to about $1,000 a month. Tr. 120.
 Tr. 109.      37
 Tr. 50.      38
 Ex. T (Budget); Tr. 54.      39
 Tr. 57.      40
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lowered.  Applicant is current in his payments on these accounts, the combined30
balances of which are slightly over $100,000.  Regarding these credit card accounts,31
Applicant’s “minimum payments add up to somewhere in the neighborhood of 2,500
dollars a month.”  Payment is also made on student loans for one child.  At least32 33
some of the credit card payments exceed the required monthly minimum payment.  He34
maintains three savings accounts, with a modest total sum balance. He also has a
current 401k account worth approximately $3,600; Applicant’s wife has a 401k with an
balance of about $25,000.  At the end of the month, after payment for monthly35
expenses, incidentals, commuting costs, mortgage payments, and bill payments,
Applicant has a net remainder of about $1,000 per month.  He declined to pursue36
bankruptcy because he has the ability to honor his debts.37
Applicant’s current position is in a different part of the country than his family
home. He commutes between coasts and shares an apartment near his work place
when away from home.  His wife budgets and manages their bills.  Therefore, he does38 39
not have an in-depth knowledge of all his accounts.  His name is on all their accounts,40
but he only makes payments on an account created for a computer purchase.
Policies
When evaluating an applicant’s suitability for a security clearance, an
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. 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. Under AG ¶ 2(c), this process is a conscientious scrutiny of a
 See also ISCR Case No. 94-1075 at 3-4 (App. Bd. Aug. 10, 1995).      41
 Department of the Navy v. Egan, 484 U.S. 518, 531 (1988).      42
 ISCR Case No. 93-1390 at 7-8 (App. Bd. Jan. 27, 1995).      43
 Id.      44
 Id.      45
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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 a41
preponderance of evidence.  The ultimate burden of persuasion is on the applicant.  42 43
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.
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 access44
to sensitive information must be resolved in favor of protecting such sensitive
information.45
Based upon consideration of the evidence, Guideline F (Financial
Considerations) is the most pertinent to this case. Conditions pertaining to this
 AG ¶ 18, which also notes, “An individual who is financially overextended is at risk of having to engage      46
in illegal acts to generate funds.”
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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
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.”  The Directive sets out several potentially disqualifying conditions under46
this guideline. Here, Applicant and his wife relied on credit cards to supplement their
income when their expenses grew unwieldy after his 2007 retirement. As a result, he
became approximately $19,718 past due on his home loan and about $322 past due on
a credit card. Therefore, 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 retired around November 2007 and returned to work about a year later.
During that period and a period of adjustment adapting to his lengthy commute, he
became past due on his home loan and on one credit card. He also relied on other
credit cards to afford his family’s lifestyle during a period of economic downturn. This
situation occurred recently. The downturn was widespread and has yet to be clearly
resolved. 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”) does not
apply. 
Moreover, while Applicant made the decision to retire on his own volition, partly
in response to friction with a new supervisor, his decision was also based on physical
injuries which made it difficult for him to meet his job requirements. That difficulty and
the recent economic downturn, which adversely affected his home’s value and
increased interest rates, were outside of his control. Instead of blithely ignoring his
financial situation, he consulted his financial advisor, repeatedly requested assistance
from his home lender, and kept current on his credit card payments. Given these facts,
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”) applies. 
Applicant received financial counseling through his financial advisor. He diligently
worked with his home lender with regard to his past due balance and the restructuring
of the loan on his home, which had suffered a drastic decline in its value. He also
became current on the past due credit card at issue. In addition, he is current on his
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other credit cards and generates sufficient income to meet all of his monthly obligations.
Consequently, 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”) and FC MC ¶ 20(d) (“the individual initiated a good-faith effort to repay
overdue creditors or otherwise resolve debts”) apply.
In presenting his case, Applicant established that the two accounts noted in the
SOR as being past due were successfully addressed. As a result, he mitigated the
security concerns regarding the two SOR allegations. Moreover, he showed that he and
his wife generate more than the income needed to meet their monthly expenses and
keep their credit accounts current. Indeed, they retain about $1,000 a month after all
monthly obligations have been met. He also presented evidence and gave testimony
that his wife often pays more than the minimum balance owed on at least some of the
credit card accounts not at issue in this case.
Whole Person Concept
Under the whole person concept, an administrative judge must evaluate an
applicant’s eligibility for a security clearance by considering the totality of an 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. 
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. Applicant’s testimony was both highly credible and direct. With regard to the
“whole person,” many factors speak in his favor. Applicant is a mature man who has
raised and educated three children. He served for 30 years in law enforcement and was
shot in the line of duty. An on-the-job injury to his back was quickly followed by other
injuries both on-the-job and at home. As a result, he still has recurring back and other
physical problems. 
Applicant’s decision to retire in 2007 proved to be ill-timed, given the economic
climate. Foreseeing the downward economic trend, he tried to work with his home loan
servicing agent before his financial difficulties affected his ability to make timely
payments. He continued those efforts after he was no longer able to make those
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payments, ultimately requesting his attorney to intercede on his behalf. Meanwhile, his
wife worked with their credit card companies to try to halt or reverse rising interest rates.
To generate his current income, he now commutes back and forth across the country.
With the lucrative salary generated by his present position, Applicant has been able to
address the past due accounts noted in the SOR and live within his means.
While not at issue in the SOR, per se, consideration must be given to Applicant’s
current finances. He has credit card debt amounting to an approximate total sum of
slightly over $100,000. While the SOR allegations failed to cite this debt or enumerate
the accounts which comprise it, the amount is considerable. Also considerable,
however, is his personal diligence and his household’s net income. Applicant and his
wife generate a net monthly income of about $10,500. From this income, they meet
their monthly expenses and credit card obligations. Payments in excess of the monthly
amount due are paid on at least some of the accounts. A monthly net sum of about
$1,000 remains after all payments are made.
Applicant successfully showed he has addressed the two accounts at issue in
the SOR. Moreover, there is no evidence Applicant is delinquent or past due on any
accounts. Given his income and the sum needed to meet his monthly obligations, there
is no evidence he is unable to live within his means, satisfy debts, or meet his financial
obligations under AG ¶ 18. Similarly, there is no evidence he is financially overextended
or at risk of having to engage in illegal acts to generate funds. Applicant and his wife
use a financial advisor and have demonstrated diligence and good judgment in
addressing their accounts. In light of their efforts and in view of Applicant’s ability to
meet his obligations with his present income, he mitigated financial considerations
security concerns.
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 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 national security to grant Applicant a security clearance.
Clearance is granted.
ARTHUR E. MARSHALL, JR.
Administrative Judge
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