KEYWORD: Guideline F
DIGEST: Given the Judge’s sustainable findings that, on their face, appear to raise certain
Guideline F mitigating conditions, the decision does not contain an adequate explanation for the
Judge’s conclusion that Applicant had failed to meet her burden of persuasion.  Adverse decision
remanded.   
CASE NO: 09-08533.a1
DATE: 10/06/2010
DATE: October 6, 2010
In Re:
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Applicant for Security Clearance
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ISCR Case No. 09-08533
APPEAL BOARD DECISION
APPEARANCES
FOR GOVERNMENT
James B. Norman, Esq., Chief Department Counsel
FOR APPLICANT
Alan V. Edmunds, Esq. and Krystal M. Limon, Esq.
The Defense Office of Hearings and Appeals (DOHA) declined to grant Applicant a security
clearance.  On March 9, 2010, DOHA issued a statement of reasons (SOR) advising Applicant of
the basis for that decision—security concerns raised under Guideline F (Financial Considerations)
of Department of Defense Directive 5220.6 (Jan. 2, 1992, as amended) (Directive).  Applicant
elected to have the case resolved on the written record.  On July 30, 2010, after the considering the
record, Administrative Judge Noreen A. Lynch denied Applicant’s request for a security clearance.
Applicant timely appealed pursuant to the Directive ¶¶ E3.1.28 and E3.1.30.
1Directive, Enclosure 2 ¶ 20(a), “[T]he 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[.]”
2Directive, Enclosure 2 ¶ 20(b), “[T]he 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[.]”
Applicant raised the following issue on appeal: whether the Judge properly applied the
Guideline F mitigating conditions to the facts of the case.  For the reasons that follow, the Board
remands the Judge’s adverse security clearance decision. 
The Judge made the following findings of fact: Applicant is a 40-year-old employee of a
defense contractor.  She is divorced, and has two children from her marriage.  Applicant held a
security clearance from 1991 through 1998.  Applicant explained that her financial problems began
in May 2008 when her husband suffered a “mental breakdown.” He abandoned the family and he
quit his job.  Applicant was not working at the time.  She relocated to her family home in another
state and sought full-time employment.  She was unemployed for about ten months.  The SOR
alleged eleven delinquent debts for unpaid credit card accounts totaling $41,871.  In addition,
Applicant reported a defaulted home mortgage loan that was past due in the amount of $162,000.
Applicant admitted the allegations.  Applicant incurred additional expenses to pay for her divorce,
which she obtained in January 2010.  She is now in the process of filing bankruptcy.  Her financial
problems are directly related to her ex-husband.  Applicant receives sporadic, limited financial
support from her former spouse.  She claims that bankruptcy is her only option because she has been
unsuccessful in selling her home.  Applicant hopes that a short sale will occur soon.  She fully
intends to pay her delinquent debts.  Applicant has paid the filing fee for her bankruptcy and her
attorney fee.  She completed the financial counseling required by the bankruptcy process in April
2010.  In May 2010, she completed a personal financial management course via the internet.
Applicant expects to receive child support in the amount of $1,500 a month, although she is not sure
that she will actually receive it.  Applicant’s current net monthly income is $3,394.  After expenses
she has a negative net remainder of approximately $200.
The Judge reached the following conclusions in the case: Applicant has approximately
$41,000 in delinquent credit card debt and she has defaulted on a home loan and is past-due in the
amount of $162,000.  She filed a petition in bankruptcy.  Consequently, Financial Considerations
Mitigating Condition ¶ 20(a)1 does not apply.  Financial Considerations Mitigating Condition ¶
20(b)2 applies in part.  Applicant’s sudden separation and divorce impacted her family finances.  She
received limited financial support from her husband.  She supported her children.  Applicant was
unemployed for ten months.  She did not pay any of her delinquent debts due to her lack of income.
However, she filed for bankruptcy in July 2010, but the debts have not been discharged.  While
filing bankruptcy is a legal remedy that released Applicant from the requirement to pay the majority
of her debt, insufficient time has passed for her to demonstrate the necessary qualities of sound
judgment, reliability and trustworthiness.  While a discharge in bankruptcy is intended to provide
a person with a fresh start financially, it does not immunize an applicant’s history of financial
3Directive, Enclosure 2 ¶ 20(d), “[T]he individual initiated a good-faith effort to repay overdue creditors or
otherwise resolve debts[.]”
4Directive, Enclosure 2 ¶ 20(c), “[T]he 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[.]”
problems from being considered.  Financial Considerations Mitigating Condition 20(d)3 applies in
part.  Applicant received the required financial counseling as part of her bankruptcy petition.   There
is no indication the financial problems will not recur.  Financial Considerations Mitigating Condition
20(c)4 partially applies.  It is too soon to show a demonstrated track record or that her financial
problems are resolved or under control.  
  
Applicant argues that the Judge erred in her application of the various Guideline F mitigating
conditions and in her application of the whole-person analysis.  Applicant also argues that the Judge
failed to weigh all available relevant evidence because she did not give Applicant a fair opportunity
to provide such evidence.  These arguments have mixed merit.
Applicant persuasively argues that the Judge did not properly apply the Guideline F
mitigating conditions.  This issue is best resolved by initially pointing out that the Judge made an
unequivocal finding that Applicant’s financial problems were directly related to her ex-husband, and
that she incurred additional expenses to divorce him.  The Judge concluded that Applicant’s sudden
separation and divorce had an impact on her family finances, and, under the whole-person analysis,
stated that Applicant suffered financial difficulty when her husband abandoned the family in 2008.
Additionally and importantly, the Judge’s decision contains no finding or conclusion, either express
or by inference, that (1) Applicant was in any way at fault for the circumstances that gave rise to the
delinquent indebtedness, (2) she behaved irresponsibly toward her finances either prior to or
subsequent to the rise of the delinquent indebtedness, or (3) she has not demonstrated due diligence
in dealing with her troubled financial  situation since separating from her husband.  To the contrary,
the Judge mentions the facts that Applicant had to incur additional expenses pursuant to her divorce
action, that she supported her children despite receiving limited support from her ex-husband, that
she was unemployed after the separation and couldn’t pay the debts because of lack of income, that
she fully intends to pay her delinquent debts, and that she obtained the requisite financial counseling
required by her bankruptcy action.  The Judge then describes the legitimacy of Applicant’s
bankruptcy action as a legal means for resolving debts.  These facts, stated by the Judge without
qualification, coupled with the absence of any finding or conclusion assigning culpability to
Applicant for her financial state, lay out a significant case for mitigation on this record.      
The Judge’s analysis under Mitigating Condition ¶ 20(a) is flawed.  The Judge concluded
that  the mitigating condition did not apply after merely citing the facts that Applicant had $41,000
in credit card debt, a defaulted past due home loan in the amount of $162,000, and had filed a
petition for bankruptcy.  The Judge offered no other explanation as to why the mitigating factor did
not apply.  The facts cited by the Judge do not render the mitigating condition inapplicable given
other evidence in this record.  While the Judge could properly conclude based on the evidence and
her own findings that Applicant’s indebtedness did not happen long ago and was not “infrequent,”
there is record evidence and there are other findings of the Judge that make other components of the
mitigating condition clearly applicable (debt occurred under such circumstances that it is unlikely
5Decision at p. 5.  Given the manner in which the Decision is written, it is not clear whether the Judge’s
statement about the likelihood of recurrence of the problem relates to Mitigating Condition ¶ 20(c), Mitigating Condition
¶ 20(d), or both. 
to recur and [the debt] does not cast doubt on the individual’s current reliability, trustworthiness, or
good judgment).  It was error for the Judge to fail to address these other factors.  The Judge also
should have either explained why these factors were not mitigating, or, in the alternative, she should
have applied them in light of her finding that Applicant’s financial troubles were directly related to
her ex-husband, and the lack of any finding or conclusion by the Judge that Applicant had acted
irresponsibly or demonstrated poor judgment either in accumulating the debt delinquencies or in
dealing with the debts subsequently. 
The Judge’s analysis concerning Mitigating Condition ¶ 20(b) is also problematic.  Again,
the Judge cited some of the salient facts of the case regarding the nature of Applicant’s indebtedness,
and then discussed Applicant’s bankruptcy and the fact that the debts contained therein have yet to
be discharged.  The Judge continued her discussion of ¶ 20(b) by stating that, although bankruptcy
is a legal remedy, insufficient time had passed for Applicant to demonstrate the necessary qualities
of sound judgment, reliability, and trustworthiness.  Given the fact that nowhere in her decision does
the Judge conclude that Applicant exhibited poor judgment, unreliability, or lack of trustworthiness,
there is no basis for the Judge to conclude that Applicant needs more time to display positive
characteristics.  Significant unchallenged evidence exists in this case which tends to establish that
Applicant’s financial difficulties were largely beyond her control.  A principal finding of the Judge
was based squarely upon this evidence.  There is a lack of substantial evidence that Applicant
behaved irresponsibly, and the Judge made no such finding.  Given this, the Judge’s conclusion that
Mitigating Condition ¶ 20(b) only partially applies, without an explanation more firmly rooted in
the underlying record, constitutes error. 
Since Applicant’s debts remain outstanding, the Judge’s conclusion that Mitigating
Conditions ¶ 20(c) and ¶ 20(d) only partially apply is sustainable.  However, the Judge’s analysis
of these mitigating conditions includes the statement, “There is no indication the financial problems
will not recur.”5  Given the Judge’s findings that Applicant’s financial problems were directly
related to her husband, that Applicant is now divorced, that she incurred extraordinary expenses of
a divorce and a bankruptcy filing, and she has gotten through a period of unemployment and is now
employed, there is significant record evidence that undercuts the Judge’s statement.  There is no
other evidence in the record indicating that Applicant’s current indebtedness is anything more than
a unique, one-time occurrence.  To the extent that the statement affected the Judge’s application of
Mitigating Conditions ¶ 20(c), and ¶ 20(d), their application needs to be reevaluated. 
The Judge’s decision notes that Applicant has not received a discharge in bankruptcy and
therefore her debts remain outstanding.  The fact that significant debts are yet to be resolved is, of
course, a matter that the Judge properly considered.  However, the Judge has not explained what she
believes Applicant could or should have done under the circumstances that she has not already done
to rectify her poor financial condition, or why the steps taken by Applicant were not “responsible”
in light of her difficult circumstances and limited resources.  See, e.g., ISCR Case No. 08-06567 at
3 (App. Bd. Oct. 29, 2009).  Therefore, the Judge has not articulated a satisfactory explanation for
her conclusions.  On remand, the Judge should issue a new decision, after addressing the errors
discussed herein.
Applicant asserts the Judge erred by not inquiring or requesting additional information from
Applicant concerning her debts in order to alleviate concerns raised about her track record or her
remaining SOR debts.  Applicant states that she was at a disadvantage as a pro se  litigant and did
not realize what documents or evidence would be relevant to the Judge’s decision in a financial case.
Applicant further states that, rather than holding her lack of knowledge against her in the decision,
the Judge should have requested further information from her.  Applicant’s arguments do not
establish error.
In ISCR proceedings, the applicant is responsible for presenting witnesses and other
evidence to rebut, explain, extenuate, or mitigate facts admitted by the applicant or proven by
Department Counsel. Directive, ¶ E3.1.15.  The Judge was under no obligation to make inquiries
of Applicant that would have had the effect of further developing the record, nor was the Judge
obligated to assist Applicant with the presentation of her case in any other way, especially since
Applicant made no such request.
DOHA sent Applicant a letter dated April 15, 2010 advising her of her right to submit any
information she wished the Judge to consider and of her right to be represented or assisted by an
attorney and the significance of the consequences of a possible adverse decision.  Applicants are free
to present their cases without the assistance of counsel or a personal representative.  Having made
that choice, however, they cannot reasonably complain about their lack of knowledge or skill after
the fact.  Moreover, contrary to Applicant’s assertions, the Board finds no evidence that the Judge
“held against” Applicant the manner in which the case was presented.  There is a rebuttable
presumption that ISCR Judge’s are unbiased, and any party seeking to overcome that presumption
has a heavy burden on appeal.  See, e.g., ISCR Case No. 07-02253 at 3 (App. Bd. Mar. 28, 2008);
ISCR Case No. 02-08032 at 4 (App. Bd. May 14, 2004).  Applicant has not met that burden.
Order    
The Judge’s adverse security clearance decision is REMANDED.
Signed: Michael Y. Ra’anan          
Michael Y. Ra’anan
Administrative Judge
Chairperson, Appeal Board
Signed: Jeffrey D. Billett                
Jeffrey D. Billett
Administrative Judge
Member, Appeal Board
DISSENTING OPINION OF ADMINISTRATIVE JUDGE JAMES E. MOODY
6See Note 2, supra.
I agree with my colleagues in their identification of errors contained in the Judge’s decision.
I also agree with their analysis of Applicant’s contention that the Judge should have sought more
evidence in this case.  However, I disagree with my colleagues as to the appropriate remedy for the
Judge’s errors.  For reasons sets forth below, I would reverse the Judge’s adverse security clearance
decision.
Department Counsel himself characterized as “well founded” Applicant’s claim that her
problems were caused by circumstances outside her control–abandonment by her husband followed
by a period of unemployment.  Furthermore, Department Counsel acknowledged that “it appears she
acted responsibly by pursuing a short-sale of her now-devalued home and in securing full-time
employment to support herself and her children.  Within her limited means and resources, it appears
that Applicant has established Financial Considerations Mitigating Condition 20(b).”6  Department
Counsel Memorandum, File of Relevant Material, April 15, 2010.  The Judge’s findings, and the
record, including evidence that Applicant is seeking bankruptcy protection, support Department
Counsel’s conclusions.  Therefore, I believe that Applicant’s situation is similar to that described
in ISCR Case No. 06-25584 (App. Bd. Apr. 4, 2008).  In that earlier decision, the Judge’s
unchallenged findings also established that the applicant’s problems had arisen from circumstances
beyond his control and that he had acted responsibly in regard to them.  We stated that the mere fact
that it might have taken the applicant a long time to resolve his debts was, in and of itself, no reason
to deny him a security clearance.  Id. at 3.  The same reasoning should apply to Applicant in the case
before us now.  
Signed: James E. Moody               
James E. Moody
Administrative Judge
Member, Appeal Board