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                              DEPARTMENT OF DEFENSE
               DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
---------, --------- --------- )       ISCR Case No. 09-08405
SSN: ------ ---- -------- )
)
Applicant for Security Clearance )
Appearances
For Government: Fahryn E. Hoffman, Esquire, Department Counsel
For Applicant: Pro se
______________
Decision
______________
WHITE, David M., Administrative Judge:
Applicant and his wife incurred almost $90,000 in delinquent debt since 2001.
Some were large credit card accounts, and some were small utility bills. They separated
in May 2009, and she created additional debt for unpaid rent and damages to their
apartment. He recently filed for divorce, and is in a relationship with another woman,
who is beginning to help him address his delinquent debt. To date, he established an
insufficient track record of financial responsibility to overcome resulting security
concerns. Based upon a review of the case file, pleadings, exhibits, and testimony,
eligibility for access to classified information is denied. 
Applicant submitted a security clearance application (SF 86) on September 8,
2009. On May 11, 2010, the Defense Office of Hearings and Appeals (DOHA) issued a
Statement of Reasons (SOR) to Applicant, detailing security concerns 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
GE 1; AE B; AE K; AE L; Tr. 52-53, 56-59, 64, 98-99, 120-121, 127-131.1
AR.2
GE 2.3
GE 2 at 12; Tr.103-107. 4
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Adjudicative Guidelines for Determining Eligibility for Access to Classified Information
that went into effect within the Department of Defense on September 1, 2006. 
Applicant answered the SOR in writing (AR) on June 8, 2010, and requested a
hearing before an administrative judge. Department Counsel was prepared to proceed
on June 25, 2010, and the case was assigned to me on June 29, 2010. DOHA issued a
Notice of Hearing on July 9, 2010, and I convened the hearing as scheduled on August
18, 2010. The Government offered exhibits (GE) 1 through 4, which were admitted
without objection. Applicant offered exhibits (AE) A through L, which were admitted
without objection, and testified on his own behalf. His significant other also testified. I
granted Applicant’s request to leave the record open until September 15, 2010, for
submission of additional evidence. DOHA received the transcript of the hearing (Tr.) on
August 26, 2010. Applicant timely submitted AE M through U, which were also admitted
without objection, and the record was closed as scheduled. 
Findings of Fact
Applicant is a 36-year-old employee of a defense contractor, where he has
worked as a heating, ventilation, and air conditioning (HVAC) mechanic since March
2009. He has no military service, and this is his first application for a security clearance.
He holds an associate’s degree from a junior college, and a technical certificate of
completion from a community college. He received an award for saving a human life
during a medical emergency in 1999. He recently filed for divorce from his second wife,
against whom he has also obtained domestic violence restraining orders. He has no
idea where his wife is, but hopes the divorce will be final by the end of the year. He has
custody of his two young daughters and of his wife’s 16-year-old daughter, and lives
with another woman, with whom he has been friends for four years, who has two young
daughters of her own.  In his response to the SOR, Applicant admitted all of the factual1
allegations in SOR ¶ 1.a through 1.m, with some explanations.  Applicant’s admissions,2
including his statements in response to DOHA interrogatories,  are incorporated in the3
following findings.
Applicant worked as a refrigeration technician at a hotel casino from 1997 to
September 2008. He and his wife, who became an alcoholic and spent a lot of money in
bars, fell behind on a number of bills and credit cards around 2001 through 2003,
resulting in the delinquent debts alleged in SOR ¶¶ 1.a through 1.l. Applicant described
the cause of his financial problems as being young and dumb, acting irresponsibly by
spending more than they earned without budgeting, and just ignoring the debts and
hoping the situation would improve. He stopped using credit cards in 2003.  The total of4
SOR; GE 3; GE 4; AE F; AE G; AE H; Tr. 102-107, 124-127.5
Tr. 117-118, 135-142.6
GE 2 at 7; AE D; AE E; AE J; Tr. 107-109, 121-124.7
GE 1 at 43-44; GE 2 at 2, 14; AE C; Tr. 78-81, 88-97, 142-143.8
Tr. 39-46.9
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those delinquent debts is $84,217. Individually, they ranged from utility bills for $36 and
$114 to credit card debts of $25,583 and $26,814. The credit card debts were incurred
purchasing regular consumer items. As of the date of the hearing, although he
expressed his intention to do so and had received several settlement offers from
creditors, Applicant had not paid anything toward, or made any arrangement to pay, any
of these debts.  The debts alleged in SOR ¶¶1.g, 1.i, 1.k, and 1.l, are so old that they5
have dropped off his current credit reports. He acknowledged, however, that these were
legitimate debts that he did not pay.6
Applicant described his intention to dispute the $5,647 collection account alleged
in SOR ¶ 1.m, because his wife should be considered solely responsible for that debt.
This debt comprises unpaid rent for, and damages to, the apartment that Applicant and
his wife rented together before they separated in May 2009. He said, without further
corroboration, that all these liabilities arose after he left, and while she was living in the
apartment with her new boyfriend. He hopes that the debt will be assigned to his wife in
connection with their pending divorce proceeding. However, the creditor has obtained a
judgment against Applicant and his wife for the debt. His wages have not yet been
garnished for satisfaction of this judgment. He has done nothing else to formally dispute
the debt, and acknowledged that his name remained on the lease during the period in
question.  7
Applicant and his house-mate have not combined their finances, but together
have a household budget that reflects a discretionary surplus of approximately $1,350
per month. That surplus only arose recently, after Applicant was awarded custody of the
three girls, for which he formerly paid his wife $1,000 per month in child support. Shortly
before the hearing, they decided to manage the negotiation of his delinquent debt
themselves, rather than hiring someone or seeking bankruptcy protection as Applicant
formerly planned. It is their intention to resolve each of these debts within the next two
years so that they can buy a house in which to raise their children. They had almost
finished paying off an $800 tax deficiency for 2009, plus interest and penalties, to the
Internal Revenue Service that was caused when Applicant’s wife filed her taxes
separately and he tried to file jointly.  8
Applicant’s supervisor for the past six months described him as “one of my
stronger performers” who was very forthright and dependable, and who ensures that his
work is completed accurately and completely. Applicant has kept his employers
informed of his financial situation and plans to resolve it.  His family members are also9
AE A.10
AE M through AE U. 11
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aware of his financial problems. Two coworkers and the mother of his house-mate wrote
letters attesting to his good character and responsibility.  His testimony during the10
hearing was sincere and credible. 
While the record remained open after the hearing, Applicant and his house-mate
began making payments toward several delinquent debts. The evidence to support this
was difficult to interpret, but appears to show that they made a $238 payment toward
the debt in SOR ¶ 1.e, in connection with an agreement to settle that $2,362 debt for
payments totaling $723. They also began making $25 weekly payments toward the
$26,814 debt alleged in SOR ¶ 1.d. They paid off the $106 debt alleged in SOR ¶ 1.h.
They also paid the $151 debt alleged in SOR ¶ 1.a, and claimed without corroborating
documentation that they paid the $36 debt alleged in SOR ¶ 1.c.11
Policies
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 (DCs) and mitigating conditions (MCs), which are to be 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 AG ¶ 2 describing the adjudicative process. The administrative judge’s
overarching adjudicative goal is a fair, impartial, and commonsense decision. According
to AG ¶¶ 2(a) and 2(c), the entire process is a conscientious scrutiny of applicable
guidelines in the context 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 the 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, “[t]he 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, and has the
ultimate burden of persuasion as to obtaining a favorable clearance decision.” Section 7
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of Executive Order 10865 provides: “[a]ny determination under this order adverse to an
applicant shall be a determination in terms of the national interest and shall in no sense
be a determination as to the loyalty of the applicant concerned.”
A person applying for access to classified information seeks to enter 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.
Analysis
Guideline F, Financial Considerations
The security concerns relating to the guideline for financial considerations are 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. 
The evidence raised security concerns under two Guideline F DCs, as set forth in
AG ¶ 19(a) “inability or unwillingness to satisfy debts”; and ¶ 19(c) “a history of not
meeting financial obligations.” Applicant’s history of delinquent debt stretches back
about nine years, and continues, in large part, at present. Some of these debts were as
small as the $36 and $114 utility bills that he acknowledged, but made no effort to
address before his hearing, despite being made aware of their security significance well
before that time. His total delinquent debt was almost $90,000, some of which may now
be legally uncollectible but none of which was repaid before his hearing. The burden
accordingly shifts to Applicant to rebut, explain, extenuate or mitigate these facts and
the resulting security concerns.
The guideline includes four conditions in AG ¶ 20 that could mitigate security
concerns arising from Applicant’s financial problems:
(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; 
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(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; and
(d) the individual initiated a good-faith effort to repay overdue creditors or
otherwise resolve debts.
Applicant’s delinquent debt began to accrue about nine years ago, but remains
delinquent for the most part to date. He offered no justification for the circumstances
under which it arose except for his irresponsibility and neglect of financial obligations.
He is now living with a different and significantly more responsible woman than he was
when the debts arose, but it is too early to reasonably conclude that this lengthy pattern
of irresponsibility is unlikely to recur and does not cast doubt on his reliability. Applicant
established the beginning of mitigation under AG ¶ 20(a), but one month of post-hearing
efforts to address the debts is insufficient to outweigh concerns arising from the nine-
year history that preceded the hearing.
Only minimal mitigation under AG ¶ 20(b) was established. Applicant fully
participated in the creation and failure to pay the debts alleged in SOR ¶¶ 1.a through
1.l. His wife’s irresponsibility concerning their apartment after he moved out, and while
he was paying her child support, was largely beyond his control. However, he failed to
show that he has since acted responsibly concerning this debt, which has now been
reduced to an enforceable judgment against him. To date he has only hoped to
convince his divorce judge to assign responsibility for it to his wife, which will not affect
his joint obligation to the third-party creditor. 
Applicant and his new house-mate decided to undertake resolution of his
delinquent debts on their own. This is a reasonable approach if they can demonstrate
sufficient budgetary discipline while raising five daughters to save enough to achieve
debt reduction. At the time of the hearing, their situation had so recently stabilized that
they had not yet made any effort toward resolution of Applicant’s delinquent debts. They
credibly testified that they intended to work toward resolution of the delinquent debts
that still appeared on Applicant’s credit report. After the hearing, they made $556 in
payments toward several debts. Even if the $50,411 in debt that no longer reflects on
Applicant’s credit reports, as alleged in SOR ¶¶ 1.g, 1.i, 1.k, and 1.l is excluded, almost
$40,000 in delinquent debt remains. If Applicant’s estimate of $1,350 in surplus income
per month is truly available, it would take 29 months to resolve this debt. The actual
payments of $556 during the month following the hearing, while debt reduction was a
priority, cause the $1,350 estimate to appear very optimistic. Thus, the beginning of
mitigation was established under AG ¶¶ 20(c) and (d), but the track record of actual
debt repayment is far too short to provide substantial mitigation of the foregoing security
ISCR Case No. 06-12930 at 2 (App. Bd. Mar. 17, 2008) (quoting ISCR Case No. 04-09684 at 2-3 (App.12
Bd. Jul. 6, 2006)). 
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concerns. Moreover, uncollectible debt may no longer support concerns about financial
coercion or duress, but ignoring financial obligations for that lengthy period does not
alleviate concerns about Applicant’s judgment or willingness to comply with rules and
regulations. 
As the Appeal Board has ruled concerning the successful mitigation of security
concerns arising from financial considerations, “[a]n applicant is not required to show
that [he] has completely paid off [his] indebtedness, only that [he] has established a
reasonable plan to resolve [his] debts and has ‘taken significant actions to implement
that plan.’”  This applicant, with significant help and resolve from his house-mate, has12
very recently begun a plan to resolve the debts that give rise to security concerns.
Additional time and documented follow-through is required, however, in order to meet
the Appeal Board’s standard of significant action to implement that plan.
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 relevant 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. 
Under AG ¶ 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.   
I considered the potentially disqualifying and mitigating conditions in light of all
pertinent facts and circumstances surrounding this case. Applicant incurred almost
$90,000 in delinquent debt, primarily due to his and his wife’s financial irresponsibility.
He expressed an intention to file bankruptcy at some future point, but never made any
concrete efforts in that regard. He and his house-mate have undertaken a plan to
resolve the delinquent debts without bankruptcy, so they can buy a home. They had not
begun resolving those debts before his hearing, but began doing so after the hearing.
His openness with all concerned about his financial situation, and proactive efforts to
achieve resolution of his debts, have begun to reduce the potential for pressure,
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coercion, exploitation, or duress. The strong testaments to his good character, integrity,
and trustworthiness by his supervisor and coworkers further evidence his potential to
reestablish his reliability and responsibility. However, facing almost $90,000 in
delinquent debt, Applicant made post-hearing payments of $556 to partially resolve
some debts and fully resolve others. He did not yet demonstrate a sufficient pattern of
financial responsibility to show that the financial concerns are unlikely to continue or
recur. 
Overall, the record evidence creates substantial doubt as to Applicant’s present
eligibility and suitability for a security clearance. He failed to meet his burden to mitigate
the security concerns arising from his financial considerations.
Formal Findings
Formal findings for or against Applicant on the allegations set forth in the SOR,
as required by ¶ E3.1.25 of Enclosure 3 of the Directive, are:
Paragraph 1, Guideline F: AGAINST APPLICANT
Subparagraph 1.a: For Applicant
Subparagraph 1.b: Against Applicant
Subparagraph 1.c: For Applicant
Subparagraph 1.d: Against Applicant
Subparagraph 1.e: For Applicant
Subparagraph 1.f: Against Applicant
Subparagraph 1.g: Against Applicant
Subparagraph 1.h: For Applicant
Subparagraph 1.i: Against Applicant
Subparagraph 1.j: Against Applicant
Subparagraph 1.k: Against Applicant
Subparagraph 1.l: Against Applicant
Subparagraph 1.m: Against Applicant
Conclusion
In light of all of the circumstances presented by the record in this case, it is not
clearly consistent with the interests of national security to grant Applicant eligibility for a
security clearance. Eligibility for access to classified information is denied.
                                              
DAVID M. WHITE
Administrative Judge