1
                                                             
                           
                        DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
--------------------- )       ISCR Case No. 10-06656
)
)
Applicant for Security Clearance )
Appearances
For Government: Eric Borgstrom, Esquire, Department Counsel
For Applicant: Pro se
                                                                            
______________
Decision
______________
MARSHALL, Jr., Arthur E., Administrative Judge:
On December 6, 2010, the Defense Office of Hearings and Appeals (DOHA)
issued a Statement of Reasons (SOR) enumerating security concerns arising under
Guideline F (Financial Considerations). DOHA took action under Executive Order
10865, Safeguarding Classified Information within Industry (February 20, 1960), as
amended; Department of Defense (DOD) Directive 5220.6, Defense Industrial
Personnel Security Clearance Review Program (January 2, 1992), as amended
(Directive); and the adjudicative guidelines (AG) effective within the DOD on September
1, 2006. 
In a January 15, 2011, response, Applicant admitted 11 of the 13 allegations
raised under Guideline F. She also requested a hearing before a DOHA administrative
judge. DOHA assigned the case to another administrative judge on February 11, 2011.
The case was transferred to me on May 2, 2011, for caseload considerations. The
parties proposed a hearing date of May 18, 2011. A notice setting that date for the
hearing was issued on April 26, 2011. I convened the hearing as scheduled. 
Applicant gave testimony, introduced one witness, and offered seven
documents, which were accepted into the record without objection as exhibits (Exs.) A-
 Tr. 15.      1
 Tr. 15.      2
 Tr. 59-60.      3
 Tr. 16.      4
 Id.      5
 Tr. 68.      6
2
G. She was given through June 10, 2011, to submit any additional documents. The
Government introduced five documents, which were accepted into the record without
objection as Exs. 1-5. The transcript (Tr.) of the proceeding was received on May 26,
2011. On June 21, 2011, Department Counsel forwarded seven additional documents
received from Applicant. Lacking any objection to their submission, they were accepted
as Exs. H-N and the record was closed. Based on a review of the testimony,
submissions, and exhibits, I find Applicant failed to meet her burden of mitigating
security concerns related to financial considerations. Clearance is denied.
Findings of Fact
Applicant is a 55-year-old electronics technician who has worked for the same
government contractor since February 2010. She is divorced and has two adult
children. Applicant earned an associate’s degree in applied science, as well as an
associate’s degree in liberal arts. She served in the U.S. Army from 1975 through 1979.
From about 1993 to 1994, Applicant was finishing her studies at community
college. A recent divorcee, she was receiving public assistance while raising her
children. Wanting to complete her academic studies, she applied for and received a
student loan for about $3,900. When she completed her degree, she accepted an entry
level job with a salary that was barely sufficient to support her children. Payments on
the loan were initially deferred. At the time, she was “very naive” about the terms of her
student loan.  The loan went into default in around 2002. 1
Applicant transferred to a new job in 2005. She “took a position of considerably
less money because [her] children were older and it afforded [her] an opportunity to
work in [her] field.”  She eventually made payments on her defaulted student loan in2
2006, but she stopped after making about nine monthly payments.3
In 2008, Applicant heard rumors that her state-sponsored position might be in
jeopardy. In April 2009, union positions were cut, but, being a non-union member,
Applicant retained her job briefly. However, a decision to further reduce the workforce
led to her dismissal as “low man on the seniority totem pole.”  With regard to her4
finances, “everything just kind of puddled” when she lost her job.  She received financial5
counseling to manage her finances.  Unemployed from April 2009 until February 2010,6
Applicant searched for a new job in a region that has taken the recent economic
 Tr. 67-68. W hile Department Counsel expressed genuine concerns regarding the issue of whether      7
Applicant’s condition was sufficiently dire if it did not adversely affect her work, Applicant stated that much of
her work is apparently the type where speed is not an issue and she could “do it in [her] sleep.” Tr. 67.
 Tr. 67-68. Applicant noted, “I was depressed or something and like I said, became a turtle and just started      8
hiding things from myself. At the time, I thought it was depression and I [did not] want to go get medication
because that will make you sleep on the job.” 
 See SOR.      9
 Tr. 21. Presumably, this attempt was before the issuance the Education Department’s Nov. 21, 2010,      10
offer for rehabilitation. 
 Ex. 2 (Student loan recovery branch, dated Nov. 21, 2010). Rehabilitation of a student loan can lead to      11
the removal of their defaulted status from a borrower’s credit report, extend repayment terms for up to 30
years, and reduce the balance owed through the elimination of collections costs and some assessments.
 Tr. 22, 27-28; Ex. D (pay stubs); see also Title IV of the Higher Education Act, which addresses student      12
loans and rehabilitation. Applicant did not provide a copy of a rehabilitation agreement. Therefore, it is unclear
whether these payments are in response to the rehabilitation offer.
 Ex L (Experian printout, dated Jun 10, 2011).      13
3
downturn particularly hard. She accepted her current position in February 2010. She
completed a security clearance application (SCA) in March 2010.
While much of the above was transpiring, Applicant began feeling down and out
of sorts. This feeling first started in about 2005. Unbeknownst to her, she was suffering
from the initial stages of a medical condition that went undiagnosed and increasingly
affected her ability to focus on her life. It went unnoticed in her workplace due to the
solitary nature of her mostly manual work.  When her symptoms first started, Applicant7
passed it off as age, exhaustion, or a ‘mind fog.” By 2010, it had worsened. She
became depressed and her lethergy made her function like “a turtle.”  8
As her illness reached a peak in mid- to late-2010, Applicant met with
investigators about her security clearance application. She was unaware of some of the
debts at issue. The abandoned student loan balance had grown to approximately
$46,273.  One of the investigators suggested she contact the student loan grantor and9
request a reduction on the balance now owed on that debt. She contacted the original
lender, but it was unwilling to reduce the balance owed or otherwise work with her.10
The loan was ultimately transferred to the U.S. Department of Education. In November
2010, she was offered the opportunity to rehabilitate the loan by making a monthly
series of at least nine regular payments.  Ultimately, payments on the loan were11
instituted by the Education Department through payroll deduction. Regular payments of
$207 have thus been made every two weeks since April 2011.  She is currently12
seeking validation of the currently purported balance through formal dispute.13
When DOHA initially received the case in February 2011, Applicant was in very
poor health and scheduling for her hearing date was tentatively postponed so she could
 At the time Applicant’s health worsened, she had been working on discovering the origin of some of the      14
debts at issue. Tr. 38.
 Tr. 18.      15
 Ex. N (Dr.’s letter, dated Jun. 2, 2011). Applicant’s physician wrote that her condition, which was ever-      16
increasingly manifesting itself with signs of depression, “fogginess,” and the feeling of being overwhelmed was
one that developed increasingly over time, noting that it may have been related to her anemia and “may have
affected her behavior and/or job performance.”
 Ex. M (Email, dated Jun. 20, 2011).      17
 Tr. 17.      18
 The adult child, who was unemployed, recently returned to the workforce.      19
 HE-1 (Government schematic).      20
 Ex. K (Experian printout, dated Jun. 10, 2011). Applicant previously disputed these items by mail with      21
Equifax and TransUnion, but has yet to receive a response. Ex. K (Email, dated Jun. 20, 2011).
4
seek treatment.  She was hospitalized in April 2011. Hospitalization and treatment14
helped stabilize Applicant’s physical condition. Her condition was found to have been
caused by complications from an earlier surgery that slowly led to chemical imbalances
and dangerously low blood levels. By the time the problem was definitively identified,
the condition was deemed life threatening and medical care was administered.  She is15
now in improved health, although she continues under medical care pending the
completion of her treatment.  Her treatment should end later this year. She has16
recovered from her sense of “fogginess.” Applicant is back at work full-time, although
she has also been dealing with the results of a recent fire and helping to care for a
grandchild.  17
In her personal life, Applicant offered some degree of financial assistance or
support to her two children at various times throughout the 2000s. Both her adult
children suffered from medical issues and, at times, came home with their spouses to
live with Applicant.  Currently, Applicant is offering her home as a place to stay for one18
of her children and a grandchild.  Such situations have caused extra strains on19
Applicant’s finances. 
At issue in the SOR are 13 delinquent debts (¶¶ 1.a-1.m). Applicant provided
evidence that the debts at issue in ¶ 1.c ($145 telecommunications debt from 2009) and
¶ 1.e ($155 collection account, date of delinquency unknown) have been satisfied.20
She has formally disputed the debts at ¶ 1.a ($50 medical debt from 2006) and ¶ 1.b
($491 medical debt from 2005), which may be related to either the onset of her illness
or long-forgotten bills related to her children.  The student loan debt noted at ¶ 1.d,21
which is in repayment with the total balance in dispute, is discussed above. The
remaining debts, including the years in which they became delinquent, are as follows
and amount to approximately $2,800:
1.f – $364 medical debt from 2009 – unpaid.
 Tr. 62.      22
 Tr. 65-66; Ex. J (Emails, various dates).      23
 Tr. 38.      24
 Tr. 24-26.      25
 Tr. 27.      26
 Ex. D (Pay stubs). Applicant’s 2011 pay stubs reflect a net income of approximately $980 every two      27
weeks after deduction of payments on her guaranteed student loan (GrnStuLn), reflecting a recent rise from
about $1,488 in 2010.
5
1.g – $780 collection account from 2009 – unpaid. Applicant testified that she made a
$100 payment by money order on this account after she was released from the hospital
in April 2011, but provided no evidence of payment.  22
1.h – $365 medical debt from 2009 – unpaid.
1.i – $110 collection account from 2009 – unpaid.
1.j – $410 collection account from 2009 – unpaid.
1.k – $265 past due credit union account (delinquency date unknown) – In
communication with creditor. Payment schedule devised.  23
1.l – $500 past due account (delinquency date unknown) – unpaid.
1.m – $75 past due account (delinquency date unknown) – unpaid. 
Since meeting with investigators and receiving the December 2010 SOR,
Applicant has been aware of the debts at issue. She suspects some of the older debts
may be related to medical bills for her children that have remained unaddressed since
her divorce. This suspicion is based on the fact that following her divorce, her husband
neglected to extend appropriate heath care coverage for their children. She also noted
that having moved multiple times, some bill statements may have eluded proper
delivery.  24
Applicant provided evidence of payment to one entity with Exs. B-C, which she
believes are for either the debts at ¶¶ 1.I and 1.j or 1.l and 1.m. She failed, however, to
provide evidence showing that any of these debts were satisfied, or that any payments
she did make otherwise satisfied these debts.  Applicant showed that she is paying a25
tax levy from 2008 not shown on the SOR.26
Applicant has developed a flexible budget under which she meets her monthly
obligations, including deductions for her student loan and current medical bills, of
approximately $2,200. This sum is deducted from her net monthly income of about
$2,000.  While these sums show a negative discrepancy, Applicant makes up for the27
 Ex. E (Budget).      28
 Tr. 30.        29
 Tr. 78.      30
 Tr. 77.      31
 Ex. I (Employer’s letter, dated May 16, 2011).      32
 Tr. 84.      33
 Id.      34
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difference with exceptional thrift, occasional contributions from her child, and
“cushions” she created that are built into her budget. Such cushions include over-
budgeting her rent for $500 a month when it is really $325, and inflating her monthly
financial needs for transportation and other costs.  By building in her cushion, she28
assures that she has sufficient funds to meet her monthly obligations, including a
category for her overdue debts. Consequently, her income almost precisely meets her
budget’s reflection of her regular and anticipated expenditures. However, there is no
evidence of any cash reserves that might help in the event of a financial emergency.
Applicant anticipates that her monthly allotment for medical bills and co-pays
($175) will be reduced considerably over the next few months as her treatments end.
She also expects to eliminate her need for miscellaneous expenditures ($100) when
her daughter and grandchild move into their own home. This move is currently planned
to take place in or by October 2011.  With her largest debt already in repayment29
(student loan), Applicant hopes to apply the monthly sums now devoted to medical bills
and miscellaneous items, which would amount to about $275, to her remaining
delinquent debts.  In general, Applicant eschews the use of credit cards and has not30
acquired additional debt.  31
Applicant is well-regarded in her community. She is a valued employee, known
for her positive attitude and excellent work.  She is committed to both her work and to32
the fulfillment of her financial obligations. As a witness, Applicant introduced a long time
friend, who corroborated the ill effects of Applicant’s illness on levels of energy and
concentration.  That same witness also noted that Applicant has improved33
considerably since her April 2011 hospitalization.34
Policies
When evaluating an applicant’s suitability for a security clearance, an
administrative judge must consider the AG. In addition to brief introductory explanations
for each guideline, the AG list potentially disqualifying conditions and mitigating
conditions. 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. Under AG ¶ 2(c), this
 See also ISCR Case No. 94-1075 at 3-4 (App. Bd. Aug. 10, 1995).      35
 ISCR Case No. 93-1390 at 7-8 (App. Bd. Jan. 27, 1995).      36
 Id.      37
 Id.      38
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process is a conscientious scrutiny of a number of variables known as the “whole-
person concept.” The administrative judge must consider all 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.
The Government must present evidence to establish controverted facts alleged
in the SOR. An 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 burden of proof is something less than a35
preponderance of evidence. The ultimate burden of persuasion is on the applicant.  36
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 safeguard
classified information. Such decisions entail a certain degree of legally permissible
extrapolation about 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). “The clearly consistent standard
indicates that security clearance determinations should err, if they must, on the side of
denials.”  Any reasonable doubt about whether an applicant should be allowed access37
to sensitive information must be resolved in favor of protecting such sensitive
information.38
Based upon consideration of the evidence, Guideline F (Financial
Considerations) is  the most pertinent to this case. Conditions pertaining to this AG that
could raise a security concern and may be disqualifying, as well as those which would
mitigate such concerns, are set forth and discussed below.
 AG ¶ 18.      39
 Id.      40
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Analysis
Guideline F - Financial Considerations 
Under Guideline F, “failure or an 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.”  It39
also states that “an individual who is financially overextended is at risk of having to
engage in illegal acts to generate funds.”  Applicant has 11 delinquent debts that40
remain unpaid. While the vast majority of debt at issue has been in repayment with the
Education Department since April 2011, approximately $3,200 remains either unpaid or
in dispute. Financial Considerations Disqualifying Condition (FC DC) AG ¶ 19(a)
(inability or unwillingness to satisfy debts) and FC DC AG ¶ 19(c) (a history of not
meeting financial obligations). With such conditions raised, it is left to Applicant to
overcome the case against her and mitigate security concerns. 
The debts at issue are multiple in number and remain largely unpaid. Although
Applicant is currently living within her income, her finances remain extremely tight due
to a temporary extension in her most current financial assistance to a child and the
continued need for medical care. Therefore, at this time, Financial Considerations
Mitigating Condition (FC MC) 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. 
Multiple factors have adversely affected Applicant’s handling of her finances.
She was underemployed after college. Her ex-husband was deficient in his provision of
health care for their children after their divorce. In 2008, she learned of a potential
reduction in force at work. While there is no evidence she then began to look for a new
job, she maintained her employment until a second round of cuts was made in 2009.
Nearly a year of unemployment followed. Meanwhile, starting in about 2005, her health
began to falter. Lethargy, depression, and a foggy state of mind escalated, affecting her
ability to function properly. Her condition was eventually diagnosed, and she was
hospitalized with a life-threatening condition in April 2011. While her health has been
restored, she is still receiving some treatment for her condition. Despite such
conditions, and giving appropriate consideration to the effect of her recent medical
issues on her ability to function, Applicant made at least some effort to keep in control
of her finances. Such factors are sufficient to raise.FC MC AG ¶ 20(b) (the conditions
that resulted in the behavior 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).
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Applicant has received financial counseling. Although it did not directly lead to a
clear plan for her current debts, it did provide her with the tools to work out a
manageable budget that helps her meet her monthly obligations and curtail the
acquisition of additional debt. From that budget, she is now making payments on her
student loan. Counseling apparently also showed her how to dispute accounts on her
credit report as a way to contest or verify credit report entries. To the extent this
counseling helped her focus throughout her illness, aided her in creating a workable
budget that has prevented her from acquiring additional debt, and helped her address
some of her delinquent debt (i.e.,  ¶ 1.c and ¶ 1.e), FC MC AG ¶ 20(c) (the person has
received or is receiving counseling for the problem and there are clear indications that
the problem is being resolved or is under control) applies. 
Applicant has paid two debts in full and formally disputed two debts (¶¶ 1.c, 1.e,
1.a, 1.b). She has budgeted for the deduction of payments on her student loan to the
Education Department, while simultaneously disputing the account balance with a major
credit reporting bureau (¶ 1.d). She has contacted and either made a payment or
discussed repayment with two creditors (¶¶ 1.g and 1.k). In addition, she has made
payments on two debts which she believes are among those noted in the SOR,
although she has been unable to provide a nexus between them for the purposes of
this process. FC MC AG ¶ 20(d), (the individual initiated a good-faith effort to repay
overdue creditors or otherwise resolve debts) applies. None of the other FC MCs apply.
Whole-Person Concept
Under the whole-person concept, an administrative judge must evaluate an
applicant’s eligibility for a security clearance by considering the totality of an applicant’s
conduct and all the circumstances. An administrative judge should consider the nine
adjudicative process factors listed at AG ¶ 2 (a). Under AG ¶ 2(c), the ultimate
determination of whether to grant a security clearance must be an overall
commonsense judgment based on careful consideration of the guidelines and the
whole-person concept. In addition, what constitutes reasonable behavior in such cases,
as contemplated by FC MC ¶ 20(b), depends on the specific facts in a given case. 
I considered the potentially disqualifying and mitigating conditions in light of all
the facts and circumstances surrounding this case, as well as the “whole-person”
factors. Applicant is a highly credible 55-year-old electronics technician who has worked
for the same government contractor since February 2010. Divorced, she raised two
children, for whom she still provides periodic financial and emotional care. She currently
helps support one child, who only recently found a new job. Applicant has two
associate’s degrees and is a veteran of the U.S. Army. She lives in a region that has
been particularly challenged in the recently adverse economy. Applicant was
unemployed for nearly a year, from April 2009 until February 2010. The physical illness
that plagued her for several years impacted her health, attitude, and focus. Recent
hospitalization helped address this condition. Her treatments should end later this year.
Applicant employs a budget which helps her meet her monthly obligations.
Applicant demonstrated that she has exerted a moderate amount of effort in
addressing the debts at issue in the past six months. Whether payments toward her
 It also remains unclear whether the current  payroll deductions for the student loan were instituted by      41
Applicant in response to the offer for loan rehabilitation, or whether it was unilaterally imposed by the
Education Department without Applicant’s direct participation. Consequently, it cannot be concluded that
Applicant’s recent deductions for her student loan are serving as a predicate to student loan rehabilitation. 
10
student loan were initiated by her through a rehabilitation agreement or imposed by the
Education Department is unclear. However, she has budgeted for these deductions and
has been in repayment since at April 2011. Two accounts, in addition to the student
loan, are in formal dispute. Two other accounts have been paid. Remaining
unaddressed is $2,800 to $3,200 in additional debts, most of which were acquired
during her illness or during her period of unemployment. Clearly, the creation of many
of her delinquent debts was related to these factors. 
Despite her renewed health and recent focus on her delinquent debt, concerns
remain regarding her past financial management. Despite the fact her student loan
became delinquent in 2002, she voluntarily took a position making considerably less
money in 2005, a volitional move that apparently further impacted her finances in an
adverse manner. Then, in 2006, she abandoned an attempt at making timely payments
on that loan after only about nine months. Moreover, there is no evidence she made
any cursory efforts to look for other positions when a reduction in force was pending in
2008 or considered secondary employment at any time.  Such factors demonstrate41
poor judgment, particularly in the face of a student loan metastasizing from only about
$3,900 to an unwieldy sum in excess of $46,000 after at least a decade of neglect.
While it is acknowledged that her illness slowly worsened to the point that it adversely
impacted her mood and ability to focus in more recent years, there is no evidence that it
was the reason Applicant’s student loan has been largely neglected since the 1990s.
However, if Applicant further explored the various possibilities available for modifying
the balance owed, this debt may prove to be far more manageable than it appears.
While Applicant is a highly credible, straight-forward, and honest woman,
concerns also remain due to the current state of her finances. At best, her current
monthly expenditures meet her monthly income with little to no excess funds available
at month’s end. She anticipates her financial situation will soon improve, assuming her
treatments end and her child moves out by October 2011. There are no guaranties,
however, that these events will occur as presently planned or that more parental or
medical assistance may be needed in the near future. Even if the sum saved by
eliminating these expenses (up to $275 a month) were to become available by the end
of the year, Applicant failed to provide evidence of a reasonable plan utilizing these
sums to address her present and delinquent obligations. 
Moreover, Applicant’s student loan payments were only recommenced in April
2011. She has yet to establish a reliable history of regular payments toward that debt.
Further, such deductions are highly contingent on her maintaining her present position
at her present salary. Should there be a change in her employment terms, those
payments would more than likely be again discontinued through simple necessity. 
In short, despite significant mitigating conditions with regard to the creation of
many of the more recent debts, Applicant failed to provide much in mitigation as to how
11
her debts will be satisfied. I do not doubt Applicant’s sincerity or her commitment to
address her debts, and I am completely sympathetic with the symptoms of her recent
illness. Hopefully, her improved health will help her in her endeavor. However, it would
be premature to conclude that she has established a reasonable plan to repay all of her
delinquent debts and that she has thus far made notable progress on those debts.
Given all these considerations, there is presently insufficient evidence to mitigate
Guideline F security concerns. Clearance is denied.       
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.e: For Applicant
Subparagraphs 1.f-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 national interest to grant Applicant a security clearance.
Clearance denied.
ARTHUR E. MARSHALL, JR.
Administrative Judge