DEPARTMENT OF DEFENSE 
         DEFENSE OFFICE OF HEARINGS AND APPEALS 
           
             
 
In the matter of: ) 
 ) 
 XXXXXXXXXX, XXXXX )  ISCR Case No. 09-02636 
 SSN: XXX-XX-XXXX ) 
 ) 
Applicant for Security Clearance ) 
 
 
Appearances 
 
For Government: Jennifer I. Goldstein, Esq., Department Counsel 
For Applicant: Pro se 
 
 
______________ 
 
Decision 
______________ 
 
 
TUIDER, Robert J., Administrative Judge: 
 
Applicant failed to mitigate Guideline F (financial considerations) security 
concerns. Eligibility for access to classified information is denied. 
 
Statement of the Case 
 
On September 12, 2008, Applicant submitted an Electronic Questionnaire for 
Investigations Processing (e-QIP). On June 25, 2009, the Defense Office of Hearings 
and Appeals (DOHA) issued a Statement of Reasons (SOR) detailing security concerns 
under Guidelines F (financial considerations) and J (criminal conduct) for 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) effective within the 
Department of Defense for SORs after September 1, 2006.  
 
 Applicant answered the SOR on July 28, 2009. Department Counsel was 
prepared to proceed on November 24, 2009. The case was previously assigned to 
another administrative judge on December 1, 2009, and was reassigned to me on 
December 15, 2009 due to caseload considerations. DOHA issued a notice of hearing 
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on January 7, 2010, scheduling the hearing for January 26, 2010. The hearing was held 
as scheduled. 
 
The Government offered Government Exhibits (GE) 1 through 5, which were 
received without objection. The Applicant did not offer any exhibits, and he testified on 
his own behalf. DOHA received the hearing transcript (Tr.) on February 3, 2010.  
 
Procedural Issue 
 
 The Government withdrew the allegations in SOR ¶ 2. (Tr. 8, 12-13.) Accordingly, 
I entered findings “For Applicant” on this allegation. The allegation will not be discussed 
further. 
 
Findings of Fact 
 
 Applicant admitted SOR ¶¶ 1.a., 1.j., 1.k., 1.m., 1.n., 1.o., 1.q., 1.r., 1.x., and 
denied the remaining allegations. His admissions and denials were accompanied with 
explanations. His admissions along with explanations are accepted as findings of fact. 
 
Background Information 
 
 Applicant is 36 years old, and has applied for a position as a background 
investigator for a defense contractor. He seeks a security clearance, which is required 
to qualify for such a position. (GE 1, Tr. 22, 20-21.) 
 
 Applicant graduated from high school in June 1991. After high school, he 
attended a community college “for a couple of years.” He completed reserve police 
officer courses in 1997, and later completed a certificate program in law enforcement in 
2000. He was a reserve police officer from September 1997 to February 2001, and 
became a full-time police officer from February 2001 to March 2008. His employment as 
a police officer ended by resignation in lieu of being involuntarily terminated. After 
leaving the police department, Applicant was unemployed from March 2008 to October 
2008. He was briefly employed as a security officer supervisor from October 2008 to 
May 2009, at which time he was laid off. Applicant has been unemployed since then. He 
has been attending college since October 2008, which he is financing on a student loan. 
(GE 1, Tr. 15-19, 27-31, 64-66.) 
 
 Applicant married in April 1999, separated in February 2007, and divorced in May 
2009. (GE 1, Tr. 21.) He has twin 15-year-old stepdaughters and a 13-year-old stepson, 
who are the children of his former spouse. He has a 13-year-old daughter from a 
previous relationship, and an 8-year-old daughter born during his marriage. Applicant is 
responsible for providing support to his two biological children. His 13-year-old daughter 
has been living with him for approximately two years. Applicant testified that her mother 
has a substance abuse problem and is under investigation for welfare fraud. (Tr. 22-26.)  
 
 
 
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Financial Considerations 
 
Applicant’s background investigation addressed his financial situation and 
included the review of his September 2008 e-QIP, and his October 2008, June 2009, 
November 2009, and January 2010 credit reports. Applicant’s SOR identified 24 
separate debts totaling $31,297. (SOR ¶¶ 1.a. – 1.x.) (GE 1 – 5, Tr. 9.) 
 
Applicant has been living on $1,440 monthly unemployment benefits since he 
was laid off in May 2009. Since separating from his former spouse, he had lived rent-
free at his grandparent’s house. Applicant attributes his financial difficulties to his former 
spouse’s mismanagement of the family finances, costs associated with his separation 
and divorce, and unemployment. He remains responsible for providing child support for 
his 8-year-old daughter, which is deducted from his unemployment checks. He is not, 
however, paying child support for his 13-year-old daughter, who lives with him. 
Applicant has no other source of income or assets other than his unemployment 
benefits. (Tr. 33-41, 66-70.) 
 
 Applicant does not have a budget per se, but rather pays his bills “as they come 
and [tries] to cope” adding “[t]hat’s basically the best I [can] do.” (Tr. 42.) He does not 
pay property taxes on his grandparents’ house, which are paid by his mother who is the 
legal owner of the house. When he needs medical treatment, he goes to Mexico as a 
less expensive option than treatment in the U.S. His daughters qualify for medical 
treatment through their state health insurance program. Applicant estimates that after 
he pays all his monthly bills, he has “maybe a hundred bucks.” He does not have a 
savings account and on the day of his hearing, he had $363 in his checking account. 
(Tr. 42-44, 70-71.) 
 
Applicant’s 24 debts include a variety of creditors – credit card companies, phone 
and utility companies, a child support arrearage, and a number of medical bills. Most of 
these debts became past-due in 2006-2007. Applicant did not appear at his hearing with 
documentation to support his claim that any of the alleged debts belonged to his former 
spouse. Furthermore, he did not provide any documentation that he had contacted his 
creditors or attempted to resolve any of the alleged debts to include the ones he 
acknowledged were his. In short, all 24 debts alleged remain unaddressed. (GE 2-5, Tr. 
44-64.) At his hearing, Applicant admitted that all of the debts alleged, to include the 
ones he denied, were established by the Government’s evidence. (Tr. 71-72.) 
Applicant’s plan is to pay his creditors when he gets a job. (Tr. 72.) 
 
Character Evidence 
 
Applicant did not submit any character evidence. 
 
Policies 
 
When evaluating an applicant’s suitability for a security clearance, the 
administrative judge must consider the adjudicative guidelines. In addition to brief 
introductory explanations for each guideline, the adjudicative guidelines list potentially 
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disqualifying conditions and mitigating conditions, which are used 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 for 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 classified 
information. Such decisions entail a certain degree of legally permissible extrapolation 
of 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 
 
  Upon consideration of all the facts in evidence, and after application of all 
appropriate legal precepts, factors, and conditions, including those described briefly 
above, I conclude that a relevant security concern exists under Guideline F (financial 
considerations). AG ¶ 18 articulates the security concern relating to financial problems: 
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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 ¶ 19 provides two financial considerations disqualifying conditions that could 
raise a security concern and may be disqualifying in this case, “(a) inability or 
unwillingness to satisfy debts,” and “(c) a history of not meeting financial obligations.” 
Applicant’s history of delinquent debt is established by his admissions and evidence 
presented. As indicated in SOR ¶¶ 1.a. to 1.x., he has 24 delinquent debts totaling 
$31,297 that have been in various states of delinquency for several years. The 
Government established the disqualifying conditions in AG ¶¶ 19(a) and 19(c).   
 
  Five financial considerations mitigating conditions under AG ¶¶ 20(a) through (e) 
are potentially applicable:  
 
(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; 
 
(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; 
 
(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; 
 
(d) the individual initiated a good-faith effort to repay overdue creditors or 
otherwise resolve debts; and 
 
(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 substantiate the basis of the dispute or provides 
evidence of actions to resolve the issue. 
 
Applicant’s conduct does not warrant application of AG ¶ 20(a) because there is 
more than one delinquent debt and his financial problems are not isolated. Therefore, 
his debts are a “continuing course of conduct” under the Appeal Board’s jurisprudence. 
See ISCR Case No. 07-11814 at 3 (App. Bd. Aug. 29, 2008) (citing ISCR Case No. 01-
03695 (App. Bd. Oct. 16, 2002)). Applicant receives only partial credit under AG ¶ 20(b), 
because his first unemployment initially began as a result of his own misconduct 
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following his resignation from the police department in lieu of being involuntarily 
terminated. His separation and divorce as well as his subsequent unemployment 
contributed to his current situation, but were not the major precipitant.  
 
His failure to remain in contact with his creditors; however, does not show that he 
acted responsibly under the circumstances.1 The remaining mitigating conditions under 
AG ¶¶ 20(c) – (e) are not applicable. Applicant did not receive financial counseling, he 
did not initiate a good-faith effort to repay his creditors or otherwise resolves his debts, 
nor did he demonstrate through documented efforts that he had a reasonable basis to 
dispute any 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. The 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.  
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. AG ¶ 2(c).  
There is evidence against mitigating Applicant’s conduct. The SOR lists 24 debts 
totalling $31,297. These debts remain unresolved and have been in various states of 
delinquency for several years. Applicant, apparently, maintained an acceptable state of 
financial responsibility before his separation from the police department and his initial 
period of unemployment. However, based on the evidence he presented, he has not 
made any documented effort to resolve his debts such as contacting creditors, at a 
minimum. His current financial situation appears grim and his plan is to pay his creditors 
when he gets a job. In the interim, he remains unable to address his financial liabilities. 
 
1“Even if Applicant’s financial difficulties initially arose, in whole or in part, due to circumstances outside 
his [or her] control, the Judge could still consider whether Applicant has since acted in a reasonable 
manner when dealing with those financial difficulties.” ISCR Case No. 05-11366 at 4 n.9 (App. Bd. Jan. 
12, 2007) (citing ISCR Case No. 99-0462 at 4 (App. Bd. May 25, 2000); ISCR Case No. 99-0012 at 4 
(App. Bd. Dec. 1, 1999); ISCR Case No. 03-13096 at 4 (App. Bd. Nov. 29, 2005)). A component is 
whether Applicant maintained contact with his creditors and attempted to negotiate partial payments to 
keep his debts current. 
 
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The mitigating evidence under the whole-person concept is insufficient to 
overcome Applicant’s current situation.  The Appeal Board has addressed a key 
element in the whole-person analysis in financial cases, stating: 
 
In evaluating Guideline F cases, the Board has previously noted that the 
concept of “‘meaningful track record’” necessarily includes evidence of 
actual debt reduction through payment of debts.” However, 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.” The Judge 
can reasonably consider the entirety of an applicant’s financial situation 
and his actions in evaluating the extent to which that applicant’s plan for 
the reduction of his outstanding indebtedness is credible and realistic. See 
Directive ¶ E2.2(a) (“Available, reliable information about the person, past 
and present, favorable and unfavorable, should be considered in reaching 
a determination.”) There is no requirement that a plan provide for 
payments on all outstanding debts simultaneously. Rather, a reasonable 
plan (and concomitant conduct) may provide for the payment of such 
debts one at a time. Likewise, there is no requirement that the first debts 
actually paid in furtherance of a reasonable debt plan be the ones listed in 
the SOR. 
 
ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008) (internal citations omitted). 
Overall, the record evidence leaves me with questions and doubts about Applicant’s 
eligibility and suitability for a security clearance. For all these reasons, I conclude 
Applicant has not mitigated the concerns arising from his financial considerations.  
 
I take this position based on the law, as set forth in Department of Navy v. Egan, 
484 U.S. 518 (1988), my careful consideration of the whole-person factors and 
supporting evidence, my application of the pertinent factors under the adjudicative 
process, and my interpretation of my responsibilities under the adjudicative guidelines. 
Applicant has not fully mitigated or overcome the Government’s case. For the reasons 
stated, I conclude he is not eligible for access to classified information. 
 
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:    AGAINST APPLICANT 
  Subparagraphs 1.a. - 1.x.:   Against Applicant 
 
  Paragraph 2, Guideline J:   FOR APPLICANT 
  Subparagraph 2.a.:    For Applicant 
 
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Conclusion 
 
In light of all the circumstances presented by the record in this case, it is not 
clearly consistent with the national interest to grant or continue Applicant’s eligibility for 
a security clearance. Eligibility for a security clearance is denied. 
 
 
 
____________________________ 
Robert J. Tuider 
Administrative Judge