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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)       ISCR Case No. 08-10456
SSN: )
)
Applicant for Security Clearance )
Appearances
For Government: Jeff A. Nagel, Esquire, Department Counsel
For Applicant: Ms. Megan Levins, Personal Representative
April 27, 2010
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Decision
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CEFOLA, Richard A., Administrative Judge:
The Applicant submitted his Electronic Questionnaires for Investigations
Processing (e-QIP), on July 17, 2008.  On November 4, 2009, the Defense Office of
Hearings and Appeals (DOHA) issued a Statement of Reasons (SOR) detailing the
security concerns under Guideline ***F for the Applicant.  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 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. 
The Applicant acknowledged receipt of the SOR soon thereafter.  He answered
the SOR in writing, and requested a hearing before an Administrative Judge.  DOHA
received the request on or about December 3, 2009, and I received the case
assignment on January 19, 2010.  DOHA issued a notice of hearing on January 25,
2010, and I convened the hearing as scheduled on February 22, 2010.  The
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Government offered Exhibits (GXs) 1 through 7, which were received without objection.
The Applicant testified on his own behalf and submitted Exhibits (AppXs) A through C,
without objection.  DOHA received the transcript of the hearing (TR) on March 2, 2010.
The record closed on February 22, 2010.  Based upon a review of the case file,
pleadings, exhibits, and testimony, eligibility for access to classified information is
granted.
Findings of Fact
In his Answer to the SOR, the Applicant admitted the factual allegations of the
one Subparagraph of the SOR, with explanation.  He also provided additional
information to support his request for eligibility for a security clearance.
Financial Considerations
The Applicant comes from a long line of military families.  (TR at page 22 line 5 to
page 23 line 6, and at page 27 line 10 to page 28 line 8.)  He served on active duty with
the U.S. Army for four years.  (Id.)  In 2005, the Applicant lost his civilian job, as the
“Fire Alarms and Fire Inspections” business he worked for went out of business.  (TR at
page 30 lines 1~14).  This caused the Applicant’s alleged financial difficulties.
1.a.  The Applicant fell behind on his house payments; and as a result, his house
was foreclosed upon in 2008.  (TR at page 28 line 19 to page 29 line 25, and at page 30
line 19 to page 33 line 5).  It is alleged that the Applicant owes $48,000, as the result of
a second mortgage being taken out on the foreclosed house.  This “loan was sold four
times”; and despite his best efforts, the Applicant was unable ascertain who was the
creditor.  (TR at page 30 line 19 to page 33 line 5).  Finally, in December of 2009, the
Applicant was able to contact the creditor.  (TR at page 23 line 6 to page 26 line 3.)  In
December this debt was settled in full for $8,500, to the satisfaction of the creditor, as
evidenced by correspondence with the creditor.  (Id, and AppX A).  Furthermore, this
debt has been removed from the Applicant’s most recent February 2010 credit report.
(AppX C.)
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 over-arching
adjudicative goal is a fair, impartial and commonsense decision.  According to
Paragraph 2(c), the entire process is a conscientious scrutiny of a number of variables
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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.
Paragraph 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 Paragraph E3.1.14, the Government must present evidence to
establish controverted facts alleged in the SOR.  Under Directive Paragraph 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.
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 relating to the guideline for Financial Considerations is set
out in Paragraph 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
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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
Subparagraph 19(a), an “inability or unwillingness to satisfy debts@ is potentially
disqualifying.  Similarly under Subparagraph 19(c), “a history of not meeting financial
obligations@ may raise security concerns.  The Applicant suffered a foreclosure; and as
a result, owed $48,000 on a second mortgage.
These are clearly countered by the Mitigating Conditions found in Subparagraphs
20(b) and 20 (d).  Under Subparagraph 20(b), it may be mitigating where “the conditions
that resulted in the financial problem were largely beyond the person’s control (e.g., loss
of employment . . .), and the individual acted responsibly under the circumstances.@
Furthermore, Subparagraph 20(d) applies where the evidence shows “the individual
initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.@
Through no fault of his own, the Applicant lost his job, which caused his financial
difficulties.  He has now settled the second mortgage debt that was of concern to the
Government.  He has no other past due debts.
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 Paragraph 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.  Here, he has the unqualified support of one of his colleagues, who has written
a letter on his behalf.  (AppX B.)
The Administrative Judge should also 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.
I considered all of the evidence, including the potentially disqualifying and
mitigating conditions surrounding this case.  Overall, the record evidence leaves me
without questions or doubts as to Applicant’s eligibility and suitability for a security
clearance.  For all these reasons, I conclude Applicant mitigated the security concerns
arising from his financial considerations.
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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
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 eligibility for a security
clearance.  Eligibility for access to classified information is granted.
Richard A. Cefola
Administrative Judge