1 As defined in Chapter 3 and Appendix 10 of DoD Regulation 5220.2-R, as amended (Regulation).
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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)
[NAME REDACTED] )       ADP Case No. 09-05295
)
)
Applicant for Security Clearance )
Appearances
For Government: Richard A. Stevens, Esquire, Department Counsel
For Applicant: Pro se
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Decision
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MALONE, Matthew E., Administrative Judge:
Applicant accrued more than $160,000 in delinquent debt, primarily through
unpaid student loans and a failed real estate venture. She also deliberately made a
false statement to the Government about her finances when she submitted her
application for a position of trust. Applicant failed to mitigate the security concerns
raised by her financial problems and her personal conduct. Applicant’s request for a
position of trust is denied. 
On February 7, 2007, Applicant submitted a Questionnaire for Public Trust
Positions (SF 85P) to obtain eligibility for an ADP I/II/III position1 for her job with a
defense contractor. She re-certified that application by re-signing it on April 30, 2007,
and again on June 19, 2007. Applicant submitted another SF 85P on September 23,
2008. After reviewing the results of the ensuing background investigation, adjudicators
for the Defense Office of Hearings and Appeals (DOHA) issued to Applicant
2 Authorized by DoD Directive 5220.6 (Directive), Section E3.1.2.2.
3 Required by Executive Order 10865, as amended, and by DoD Directive 5220.6 (Directive), as amended.
4 The adjudicative guidelines were implemented by the Department of Defense on September 1, 2006. These
guidelines were published in the Federal Register and codified through 32 C.F.R. § 154, Appendix H (2006).
Pending official revision of the Directive, they take precedence over the guidelines listed in Enclosure 2 to the
Directive.
2
interrogatories2 to clarify or augment information obtained in her background
investigation. 
After reviewing the results of the ensuing background investigation and
Applicant’s responses to the interrogatories, DOHA adjudicators were unable to make a
preliminary affirmative finding3 that it is clearly consistent with the national interest to
grant Applicant’s request for a position of trust. On September 1, 2010, DOHA issued to
Applicant a Statement of Reasons (SOR) alleging facts which, if proven, raise security
concerns addressed in the adjudicative guidelines (AG)4 for financial considerations
(Guideline F) and personal conduct (Guideline E).
Applicant timely answered the SOR and requested a hearing. The case was
assigned to me on November 10, 2010. Pursuant to a Notice of Hearing issued on
November 16, 2010, I convened a hearing in this matter on December 8, 2010. The
parties appeared as scheduled. On December 28, 2010, DOHA received a transcript of
the hearing. 
The Government presented ten exhibits that were admitted without objection as
Government Exhibits (Gx.) 1 - 10. Applicant testified and submitted two exhibits that
were admitted without objection as Applicant’s Exhibits (Ax.) A and B. At the hearing,
Applicant claimed that she had additional relevant information to submit, including
letters of recommendation, and documents to corroborate her testimony as well as her
response to the SOR. Without objection, I left the record open after the hearing to allow
Applicant time to make a post-hearing submission. (Tr. 16 - 20, 52 - 54, 104 - 105)
However, she failed to timely submit any further information.
Findings of Fact
Under Guideline F, the Government alleged that Applicant owed $166,331 in
delinquent debt for 28 unpaid accounts (SOR 1.a - 1.bb). Applicant admitted SOR 1.a,
1.c - 1.e, 1.h, 1.p, 1.s, 1.t, 1.v, 1.w, and 1.bb. She denied the remaining allegations,
although she acknowledged at hearing that she did not deny owing the creditors listed
at SOR 1.l - 1.r, and 1.u. Rather, she is disputing the balance owed on these debts and
admits that they were delinquent. (Tr. 13 - 15). 
Under Guideline E, the Government alleged that when Applicant answered “no”
to SF 85P question 22.b (Are you now over 180 days delinquent on any loan or financial
obligation?), she knowingly and willfully made a false statement to the Government by
trying to conceal her debts. Applicant denied this allegation.
3
Applicant’s admissions are incorporated as findings of fact. Based on a review of
the pleadings, exhibits, and the transcript, I have made the following additional findings
of relevant fact.
Applicant is 36 years old and is employed by a defense contractor for work that
requires access to sensitive automated information to perform her duties as a business
analyst. She graduated from college in 1997 with a degree in English. Applicant
financed her college education with more than $60,000 in student loans. She has been
steadily employed since graduating, except for a period of involuntary unemployment
from June 2006 until February 2007 after being laid off from a previous job. Applicant
and her husband have been married since September 2000. They have two children
(ages 12 and 8). (Gx. 1)
In about 2004, Applicant and her husband decided to invest in real estate to
supplement their income. They partnered with a co-worker, who invested $8,000 with
the understanding that he would receive $12,000 in return. The investment involved the
purchase of four houses, which they would rent out until it was profitable to sell them.
For a time, this venture was profitable enough that Applicant and her husband quit their
regular jobs. Their spending also increased along with their income. Applicant and her
husband bought a 6,000 square foot home and increased their use of personal credit
through credit cards. Unfortunately, the housing market declined precipitously in about
2006. When they could not find renters to keep the properties filled and producing
sufficient income to pay the mortgages, Applicant and her husband lost the homes to
foreclosure and struggled to keep up with their personal financial obligations. A credit
report obtained in October 2008 attributed to Applicant 25 accounts in collection or
seriously past-due. (Gx. 8) This and two other credit reports obtained in July 2009 (Gx.
9) and June 2010 (Gx. 10) document all of the debts alleged in the SOR.
  One of the debts (SOR 1.u) is for the amount owed to Applicant’s investment
partner in their failed real estate venture. The partner referred the matter to a debt
collection agency and Applicant has been paying him back through monthly $400
payments. (Answer to SOR; Tr. 83 - 85) Two other debts totaling $160 (SOR 1.z and
1.aa) are likely not valid. Also, the creditor in SOR 1.x has no record that Applicant is
indebted to that company. (Ax. B)
Of the total debt alleged in the SOR, about 85% is comprised of Applicant’s
unpaid student loans (SOR 1.n - 1.p totaling $69,676), remaining mortgage obligations
on one of their investment properties (SOR 1.l, 1.m, 1.q and 1.r totaling $61,223), and
the remainder after resale of a repossessed car (SOR 1.s for $9,742). As to the student
loans, in January 2009, Applicant entered into a repayment agreement with a collection
agency to whom the Department of Education referred the debt. (Ax. A) Applicant
estimates that the current balance due on all of her student loans is about $48,000. She
claimed that her student loans are no longer delinquent. (Tr. 74 - 75)
As to her remaining delinquent mortgages and related debts, Applicant claimed
that all of the properties have been foreclosed and that she has no further obligation.
She also averred that she had a contract for the sale of her last investment property for
5 Regulation, ¶ C3.6.15. 
6 Regulation, ¶ C6.1.1.1. 
7 Regulation, ¶ C8.2.1. 
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a profit, but claimed the sale fell through. (Tr. 48 - 53) She did not, however, document
any of her claims regarding her mortgage debts. 
Applicant further stated that she has been trying to negotiate with the car
repossession creditor to establish a repayment plan. Applicant claimed the creditor has
demanded $7,000 as a settlement payment. (Answer to SOR; Tr. 95 - 102)
Applicant claimed in her SOR Answer and at the hearing, that she has paid or
otherwise settled numerous other debts. However, despite being given extra time in
which to do so, she presented no corroborating documents.
In March 2009, Applicant and her husband hired a debt management specialist
to help them repair their credit and resolve their delinquent debts. Applicant asserted
that they were able to resolve several debts, not all of which were alleged in the SOR.
However, Applicant and her husband have not been able to completely resolve their
debts through this specialist because Applicant’s husband was laid off in December
2009. (Tr. 41, 92 - 94) No documentation of those resolutions was presented.
In response to her financial problems, Applicant and her husband have cut costs,
including selling their home and moving into a small rented apartment. They have also
not taken a vacation in several years. (Tr. 43 - 45) To increase their income, she and
her husband started a small information technology business in September 2010.
Applicant testified that they are working on a state government contract worth $1 million.
(Tr. 89 - 90) Again, no corroborating information was submitted.
After Applicant submitted her first SF 85P (Gx. 2), she was interviewed on
October 11, 2007, by a Government investigator. That interview covered, among other
topics, Applicant’s debts that were past-due at that time. In response to question 22.b
(Debts greater than 180 days delinquent), she answered “no.” When she submitted her
September 2008 SF 85P, in response to the same question, she answered “no” and
stated “none that I am aware of.” (Gx. 1)
Policies
Positions designated as ADP I/II/III are classified as “sensitive positions.”5 In
deciding whether a person should be assigned to an ADP position, it must be
determined that his or her loyalty, reliability, and trustworthiness are such that it is
“clearly consistent with the interests of national security” to do so.6 The Regulation also
requires that DoD contractor personnel are entitled to the procedural protections in the
Directive before any adverse determination may be made.7
8 Directive. 6.3.
5
The Directive requires that each decision be a fair, impartial, and commonsense
determination based on examination of all available relevant and material information,8
and consideration of the pertinent criteria and adjudication policies in the adjudicative
guidelines. Decisions must also reflect consideration of the factors listed in ¶ 2(a) of the
new guidelines. Commonly referred to as the “whole-person” concept, those factors are:
(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 presence or absence of a disqualifying or mitigating condition is not, by itself,
conclusive. However, specific applicable guidelines should be followed whenever a case
can be measured against them as they represent policy guidance governing the grant or
denial of eligibility for a position of trust.
The Government bears the initial burden of producing admissible information on
which it based the preliminary decision to deny or revoke a position of trust for an
applicant. Additionally, the Government must be able to prove controverted facts
alleged in the SOR. If the Government meets its burden, it then falls to the applicant to
refute, extenuate, or mitigate the Government’s case. Because no one is entitled to a
position of trust, an applicant bears a heavy burden of persuasion. A person who has
access to sensitive information enters into a fiduciary relationship with the Government
based on trust and confidence. Thus, the Government has a compelling interest in
ensuring applicants possess the requisite judgment, reliability, and trustworthiness of
one who will protect sensitive information as his or her own. Any reasonable doubt
about an applicant’s suitability for access should be resolved in favor of the
Government.
Analysis
Financial
In addition to Applicant’s admissions, and despite her denials, the Government
submitted sufficient information to support all of the allegations in SOR 1.a - 1.bb. The
facts established raise a security concern about Applicant’s finances, which is stated in
AG ¶ 18, is that:
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
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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.
More specifically, the ongoing presence of significant amounts of unpaid debt since
2005 requires application of the disqualifying conditions listed at AG ¶ 19(a) (inability or
unwillingness to satisfy debts), and AG ¶ 19(c) (a history of not meeting financial
obligations). 
Despite the apparent resolution of the debts at 1.x, 1.z, and 1.aa, Applicant still
carries significant past-due debt. The mitigating condition at 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) does not apply because Applicant’s debt is a current
concern. It also casts doubt on her judgment, largely because it appears she
deliberately omitted information about her debts from her SF 85P, as discussed under
Guideline E, below, and because she did not corroborate her claims that she no longer
owes most of her debts. 
Applicant’s financial problems arose through a business downturn. Such
circumstances require consideration of the mitigating condition at 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). To some extent, Applicant has acted responsibly under the
circumstances by cutting costs. However, she is not entitled to the full benefit of AG
20(b) because she has not sufficiently corroborated her efforts to resolve her debts. 
Applicant is also entitled to some benefit from 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) because she and her husband
used a debt management professional in 2009. However, she has not sufficiently
documented the results of that effort. Nor has she established that her current finances
are sound. Her lack of documentation also undermines application of the mitigating
condition at AG ¶ 20(d) (the individual initiated a good-faith effort to repay overdue
creditors or otherwise resolve debts). Additionally, Applicant did not corroborate the
disputes she claimed to have with some of her creditors. Accordingly, the mitigating
condition at 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 substantiate the basis of the dispute or provides evidence of actions to resolve the
issue) does not apply. On balance, Applicant has not mitigated the security concerns
about her finances.
Personal Conduct
Although Applicant denied the SOR 2.a allegation of deliberate falsification, all of
the information probative of Applicant’s intent at the time she completed her 2008 SF
85P shows that her omissions were intentional. Accordingly, available information raises
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a security concern about Applicant’s personal conduct, which is stated at AG ¶ 15, as
follows:
Conduct involving questionable judgment, lack of candor, dishonesty, or
unwillingness to comply with rules and regulations can raise questions
about an individual's reliability, trustworthiness and ability to protect
classified information. Of special interest is any failure to provide truthful
and candid answers during the security clearance process or any other
failure to cooperate with the security clearance process.
Specifically, after discussing her debts with an investigator in 2007, Applicant still
omitted adverse financial information. Such conduct requires application of the
disqualifying condition at AG ¶ 16(a) (deliberate omission, concealment, or falsification
of relevant facts from any personnel security questionnaire, personal history statement,
or similar form used to conduct investigations, determine employment qualifications,
award benefits or status, determine security clearance eligibility or trustworthiness, or
award fiduciary responsibilities).
By contrast, she has not done anything to correct her omission. Her failure to
provide corroborating information about her efforts to resolve her finances also
undermines her claims that she did not think she had any debts that should have been
listed in response to the question at issue. Each time she certified her answers to the
SF 85Ps in evidence, Applicant made a false statement to the Government. Thus, it
cannot be safely said that she will not attempt to misrepresent herself to the
Government in the future. Finally, deliberately making a false statement to the
Government is not a minor infraction. It is potentially a violation of federal law, and it is
inconsistent with basic tenets of DoD’s personnel security system. Accordingly, this
record does not support application of any of the mitigating conditions listed at AG ¶ 17.
Applicant has failed to mitigate the adverse security concerns raised by the
Government’s information about her personal conduct.
Whole-Person Concept
I have evaluated the facts presented and have applied the appropriate
adjudicative factors under Guidelines E and F. I have also reviewed the record before
me in the context of the whole-person factors listed in AG ¶ 2(a). Applicant is 36 years
old, has been married for 10 years, is a college graduate, and mother of two. Such
information supports a presumption that she is a mature, responsible adult. However,
the positive information about her professional and personal circumstances is
insufficient to outweigh the security concerns raised by her unpaid debts and her false
statements about her finances. A fair and commonsense assessment of all of the
available information shows that Applicant has not resolved any of the doubts about her
suitability for access to sensitive information. Because protection of the national interest
is the primary concern here, such doubts must be resolved against the individual.
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Formal Findings
Formal findings 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.m: Against Applicant
Subparagraphs 1.n - 1.p: For Applicant
Subparagraphs 1.q - 1.w: Against Applicant
Subparagraph 1x: For Applicant
Subparagraph 1.y: Against Applicant 
Subparagraphs 1.z, 1.aa: For Applicant
Subparagraph 1.bb: Against Applicant
Paragraph 2, Guideline E: AGAINST APPLICANT
Subparagraph 2.a: Against Applicant
Conclusion
In light of all of the foregoing, it is not clearly consistent with the national interest
for Applicant to have access to sensitive automated information. Request for a position
of trust is denied.
                                         
MATTHEW E. MALONE
Administrative Judge