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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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------------------------- )     ISCR Case No. 08-08166
SSN: ----------------- )
)
Applicant for Security Clearance )
Appearances
For Government: Tom Coale, Esquire, Department Counsel
For Applicant: Pro Se
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Decision
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MATCHINSKI, Elizabeth M., Administrative Judge:
Applicant fell behind on some of his financial obligations due to a divorce and
having to cover the costs of his father’s burial. As of July 2009, the credit reporting
agencies were reporting a total of $2,424 in past due balances. Financial concerns are
mitigated because of his efforts to correct his credit record and his intent to pay
legitimate balances. Clearance is granted.
Statement of the Case
Applicant submitted an Electronic Questionnaire for Investigations Processing (e-
QIP) on February 9, 2008. On June 25, 2009, the Defense Office of Hearings and
Appeals (DOHA) issued a Statement of Reasons (SOR) to Applicant detailing the
security concerns under Guideline F, financial considerations, that provided the basis
for its preliminary decision to deny him a security clearance and refer the matter to an
administrative judge. 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
In its correspondence forwarding the FORM to Applicant on August 12, 2009, DOHA indicated that1
he requested a determination without a hearing. The file for review does not contain a document from
Applicant confirming that request. Applicant acknowledged receipt of the FORM on September 11, 2009, and
he did not object to proceeding without a hearing. In its FORM, the government took the position, consistent
with ¶ E3.1.7 of the Directive, that since Applicant did not request a hearing, his case defaulted to an
administrative determination.
Included in Item 2 of the FORM is a transmittal letter from DOHA to Applicant dated March 31, 2009,2
referencing an enclosed SOR and a receipt signed by Applicant on April 15, 2009. The SOR of record, which
was included in the FORM as Item 1, is dated June 25, 2009. Presumably, an earlier version of the SOR was
forwarded to Applicant by the transmittal letter dated March 31, 2009. Item 7 of the FORM consists of an
unsigned statement from Applicant dated May 1, 2009, which Department Counsel indicates was Applicant’s
original answer to the SOR allegations. W hether due to a copying error or some other cause, text was
missing, from lines 3 through 10 and 12 through 19, of Item 7 forwarded to me for review. At my request, Chief
Department Counsel submitted a complete copy of the document by facsimile on March 22, 2010, and it was
included in Item 7.
Applicant did not indicate on his e-QIP that the company was a federal contractor (Item 4). But in his3
letter of May 1, 2009, Applicant related that he was “traveling all over the world doing projects” and was
abroad working on a consulate. He is apparently seeking a secret-level security clearance (Item 7).
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Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines
(AG) promulgated by the President on December 29, 2005, and effective within the
Department of Defense as of September 1, 2006. 
 
Applicant answered the SOR on August 3, 2009. There is no indication in the file
submitted for review that he requested a hearing.  On August 12, 2009, the government1
submitted a File of Relevant Material (FORM) consisting of seven exhibits (Items 1-7).2
DOHA forwarded a copy of the FORM to Applicant and instructed him to respond within
30 days of receipt. No response was received by the October 11, 2009, due-date. On
December 2, 2009, the case was assigned to me to consider whether it is clearly
consistent with the national interest to grant or continue a security clearance for
Applicant. Based upon a review of the government’s FORM, eligibility for access to
classified information is granted.
Findings of Fact
DOHA alleged under Guideline F, financial considerations, that Applicant owes
eight delinquent debts totaling $25,667 (SOR 1.a-1.h) (Item 1). Applicant indicated the
$435 tax lien in SOR 1.a had been paid, and that the $389 telephone debt in SOR 1.c
and the $1,600 debt in SOR 1.h were pending negotiations and would be “corrected” by
2010. Applicant denied any responsibility for the other debts in the SOR and averred
they had been cleared from his credit report (Item 3). After considering the evidence of
record, I make the following findings of fact.
Applicant is a 39-year-old electrician, who worked for a defense contractor in a
war zone in Southwest Asia from August 2004 to September 2005. He now works for a
different company performing installations in various countries, including at consulates
abroad. He requires a secret-level security clearance.3
I took judicial notice sua sponte of a map of the pertinent state. The municipality in which Applicant4
maintains his residency is incorporated within the county that issued the lien reported on his credit report. It
is unclear whether this is a different lien from that reported on his e-QIP. The county named on his e-QIP is
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In May 2000, Applicant purchased his home by taking out a 30-year mortgage of
$91,650, to be repaid at $1,036 per month (Item 3, 5). In October 2002, he went into
business for himself, as an electrical contractor (Item 4). He began having financial
troubles when he had to cover the cost of his father’s burial sometime before August
2004. He terminated a lease agreement prematurely around July 2003, and the lender
placed a balance of $1,215 for collection in March 2004 (SOR 1.h) (Item 3, 5). But the
full extent of his delinquencies at that time cannot be readily ascertained from the file.
Before Applicant left for Southwest Asia in August 2004, he retained the services
of a credit resolution company to help him clear up his credit problems. His spouse was
supposed to work with the credit resolution company on his behalf while he was
overseas, but she failed to do so (Item 4, 7). In September 2005, Applicant returned to
the U.S. and began working for his current employer. He and his spouse began to have
marital problems, in part over her spending (Item 7), and they were divorced in January
2007 (Item 4). From February 2006 through June 2006, Applicant was regularly 30 days
late in his monthly mortgage payment. Over part of that time, from March 2006 to May
2006, Applicant was in Southeast Asia on business for his employer (Item 4). As of July
2006, his mortgage was 60 days past due. Applicant brought his mortgage current in
August and September 2006, but he did not pay the mortgage on time for the months of
October 2006 through February 2007, and April 2007. Applicant paid his mortgage on
time after April 2007 (Item 3).
On February 9, 2008, Applicant completed an e-QIP for a secret-level security
clearance. In response to inquiries about his finances, he indicated that there was an
outstanding lien against his business for $325.62 from December 2007. He tried to pay
it, but was told there was no delinquency. He also listed a $2,965 judgment in collection
since February 2002, which he was trying to clear up because some of the charges
were not correct. Applicant responded “Yes” to questions 28.a (“In the last 7 years, have
you been over 180 days delinquent on any debt(s)?”) and 28.b (“Are you currently over
90 days delinquent on any debt(s)?”), listing two credit card balances of $1,423.27 and
$1,220 from 2002. He was negotiating settlements on both accounts. He attributed his
debt problems to his divorce and the expenses of his father’s burial:
Just to give explanation of my troubles. I got over my head in credit
problems but was maintaining. I fell short after my father had passed away
with the cost of burial. Once this happened then of course I fell too far
behind and tried to work with my creditors but could never catch up. I have
since divorced and this has compounded my situation but nevertheless I
will complete a recovery in all [financial matters] (Item 4).
Applicant’s consolidated credit report of April 2008 revealed that a $435 tax lien
had been filed against him in May 2005 by his county clerk,  and that a $2,965 judgment4
adjacent to his county.
Applicant made the payment not to his county, but to the adjacent county (Item 3), which may or may5
not be authorized to accept payments of property taxes assessed in surrounding areas.
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had been awarded a credit card lender in September 2001. Several collection debts
also were on his record:  $389 for wireless telephone services (SOR 1.c), $13,416 on
an installment loan that had a high credit of $4,590 (SOR 1.d), $1,640 on an installment
account with a home improvement retailer (SOR 1.g), $4,821 in a credit card balance
(SOR 1.f), and $1,600 for early termination of a lease (SOR 1.h). Applicant was listed as
an authorized user on a credit card account with a delinquent $401 balance (SOR 1.e)
(Item 5).
Around the fall of 2008, DOHA asked Applicant to verify the current status and
any payments of the debts on his credit report. Applicant responded that some of the
debts “ocurred [sic] due to [his] ex-wife.” He asserted that he had worked through a debt
resolution firm to reduce and eventually eliminate his debts before his divorce, but that
he was seeking assistance from a better debt management company to take care of his
debts by 2010. Applicant provided DOHA with an agreement dated November 3, 2008,
between him and a new credit services firm. Applicant agreed to pay a retainer fee of
$781 plus $99 monthly for the company to audit the credit reporting agencies and
Applicant’s creditors, and to demand that any information on Applicant’s credit report
that is erroneous or inaccurate be corrected or deleted (Item 6).
In April 2009, Applicant was 30 days past due on his automobile loan payment.
He had taken out a loan of $11,729 in October 2008, to be repaid at $256 per month for
60 months (Item 3). Applicant was apparently overseas working at the time. On May 1,
2009, Applicant notified DOHA that the information on his credit report was outdated,
and that he was working with a credit repair agency to correct the issues. He had been
unsuccessful in obtaining a recent credit record due to him being overseas working on a
new consulate. He was scheduled to return to the U.S. on May 24, 2009, and would
obtain a credit report at that time to submit to DOHA (Item 7). He brought his automobile
loan current in May 2009 (Item 3).
DOHA issued an SOR to Applicant on June 25, 2009, alleging the unpaid tax and
credit card judgments (SOR 1.a, 1.b), and the six collection debts that appeared on his
April 2008 credit report (SOR 1.c-1.h) (Item 1). On July 21, 2009, Applicant obtained a
credit report from each of the three credit reporting agencies. Trans Union reported as
adverse accounts only the state tax lien of $435, the wireless telephone debt of $389,
and Applicant’s mortgage, which was current but had been last delinquent in April 2007.
Experian reported the wireless telephone debt and the mortgage (again because of late
payments in the past), but also the debt owed the leasing company (SOR 1.h). Equifax
reported no negative accounts and no collections on file (Item 3). On July 23, 2009,
Applicant paid a county property tax debt of $361.23 plus a convenience fee of $9.03
online.  On August 3, 2009, Applicant answered the SOR. He cited his recent property5
tax payment as evidence that the debt in SOR 1.a had been paid. Applicant indicated
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that false credit information had been reported on his record, including the debts alleged
in SOR 1.b through 1.g, that had been deleted per his updated July 2009 credit report.
He added that he had been told by his interviewer that he would be given some time to
resolve the issues on his credit record, which he had not checked in many years (“I just
cannot understand how false information can be posted on a report but mistakes do
happen”). As for the verified debts in SOR 1.c and 1.h, Applicant indicated they were
pending negotiation and would be corrected by 2010 (Item 3).
Policies
The U.S. Supreme Court has recognized the substantial discretion the Executive
Branch has in regulating access to information pertaining to national security,
emphasizing that “no one has a ‘right’ to a security clearance.” Department of the Navy
v. Egan, 484 U.S. 518, 528 (1988). When evaluating an applicant’s suitability for a
security clearance, the administrative judge must consider the adjudicative guidelines
(AG). In addition to brief introductory explanations for each guideline, the adjudicative
guidelines list potentially disqualifying conditions and mitigating conditions, which are
required to be considered 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.
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
that the applicant may deliberately or inadvertently fail to protect or safeguard classified
information. Such decisions entail a certain degree of legally permissible extrapolation
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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).
Analysis
Guideline F, Financial Considerations
The security concern about finances 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.
Applicant admitted to a history of financial delinquency when he applied for his
security clearance in February 2008 (Item 4). He was not specific about the extent and
nature of his past due accounts. While he listed four debts totaling $5,933.89 (including
two credit card delinquencies that may or may not appear on his April 2008 credit
report), he disputed the balance of the $2,965 judgment debt (Item 4). A subsequent
check of his credit in April 2008 revealed an outstanding tax lien, albeit of $435 rather
than $325, and the $2,965 judgment debt. But also on his credit record were six
collection accounts totaling $22,267, all but $1,989 (SOR 1.c, 1.h) disputed by
Applicant. While Applicant has the ultimate burden of persuasion as to obtaining a
favorable clearance decision (see Directive 5220.6, ¶ E3.1.15), Department Counsel
has the burden to establish facts in the SOR that have been controverted (see Directive
5220.6, ¶ E3.1.14). AG ¶ 19(a), “inability or unwillingness to satisfy debts,” and ¶ 19(c),
“a history of not meeting financial obligations,” are established, but the evidence falls
short of substantiating the amount of delinquency alleged by the government.
Applicant’s credit report of July 21, 2009, confirms the validity of the tax lien, the
wireless phone debt, and the leasing company debt, which altogether total about
$2,424. As noted by the government in the FORM, it is unclear whether the online tax
payment of $361.23, to a county adjacent to the county that filed the lien, suffices to
resolve the $435 tax lien. As for the contested debts, the government submits that
removal of the debts from Applicant’s credit report is circumstantial evidence of a valid
dispute but is not dispositive of whether Applicant owed the debt. Applicant was
sufficiently concerned about the information on his credit record to retain the services of
a credit restoration company in November 2008 to pursue the deletion of inaccurate or
erroneous information from his credit record, and most of the collection debt had been
removed.  AG ¶ 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
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substantiate the basis of the dispute or provides evidence of actions to resolve the
issue,” applies in part. Furthermore, the deletion of the adverse information from
Applicant’s credit record raises considerable doubt about the extent to which the April
2008 credit report can be relied on to establish Applicant’s indebtedness.
That being said, Applicant knew as of February 2008 that a judgment of $2,965
had been awarded against him (SOR 1.b). It is unclear whether all of the charges on
that credit account were determined to be illegitimate, as his denial of the debt would
suggest. On his e-QIP, he stated that “some” of the charges were not correct. Even if
Applicant had resolved the two credit card debts on his e-QIP, and if all or part of the
judgment debt in the SOR was determined to be invalid or not his responsibility, his
credit situation has not always been as stable as it now appears. Although not alleged,
Applicant had a history of late payments on his mortgage, albeit primarily when he was
overseas for business and later around his divorce.
Applicant presented no evidence showing that the undisputed debts in SOR 1.c
and 1.h have been paid, even if the July 2009 property tax payment covered the tax
judgment filed in 2005. So, it is difficult to fully apply 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.”
AG ¶ 20(b), “the conditions that resulted in the financial problem 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, in that Applicant’s financial
problems were due in part to his ex-spouse, and to the unexpected costs of his father’s
burial. Applicant was in Southwest Asia working with the U.S. military in a war zone
from August 2004 to September 2005, when the tax lien was filed against him. His ex-
spouse failed to work with the credit restoration agency while he was overseas, and her
spending contributed to their subsequent divorce (“All she could do was waste my
money while I [sic] being patriotic and hence the divorce reason.” Item 7).
Applicant knew in February 2008 that his financial issues could be of concern to
the Department of Defense. He “initiated a good faith effort to repay overdue creditors
or otherwise resolve debts,” which is required under AG ¶ 20(d), by retaining the
services of a credit restoration company in November 2008 to investigate debt
information that appeared to him to be incorrect. The company acted as his agent while
he was working overseas. Applicant’s payment of a property tax debt in July 2009 is
evidence of his intent to pay his legitimate financial obligations, irrespective of whether
that payment resolved the tax lien.
Applicant elected not to respond to the FORM, so the status of any negotiations
with the creditors in SOR 1.c and 1.h is unknown. Certainly, Applicant’s case in
mitigation would have been stronger had he presented evidence of recent payments on
those verified debts. But his overall financial picture is now stable. His July 2009 credit
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report shows no new accounts delinquent over 90 days. He has been timely in his
mortgage payments since May 2007. As of April 2009, he was past due 30 days on an
automobile loan taken out in October 2008 for $11,729, but it was when he was working
on a consulate abroad. He brought the account current in May 2009. The credit card
delinquencies he listed on his e-QIP are not on his July 2009 credit report, so it is likely
that they have been resolved or successfully disputed. He is likely to resolve his
remaining financial issues in the near future. 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,” applies.
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 conduct
and all the circumstances in light of 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 eligibility for a security
clearance must be an overall common sense judgment based upon careful
consideration of the guidelines and the whole-person concept.
The DOHA Appeal Board has addressed a key element in the whole person
analysis in financial cases stating, in part, “an applicant is not required, as a matter of
law, to establish that he has paid off each and every debt listed in the SOR. All that is
required is that an applicant demonstrate that he has ‘ . . . established a plan to resolve
his financial problems and taken significant actions to implement that plan.’” ISCR Case
No. 07-06482 at 2-3 (App. Bd. May 21, 2008) (internal citations omitted). Applicant took
action to investigate debt information that did not seem accurate to him, and most of the
debt listed on his April 2008 credit report has been deleted. Business assignments
overseas do not relieve him of his responsibility for monitoring his credit, but he now
knows that failure to do so can have adverse consequences in time and money. Based
on what can be gleaned from his July 2009 credit report, his present financial situation
causes little concern. I conclude that it is clearly consistent with the national interest to
grant Applicant a security clearance at this time.
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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
Subparagraph 1.c: For Applicant
Subparagraph 1.d: For Applicant
Subparagraph 1.e: For Applicant
Subparagraph 1.f: For Applicant
Subparagraph 1.g: For Applicant
Subparagraph 1.h: For Applicant
Conclusion
In light of 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.
Elizabeth M. Matchinski
Administrative Judge