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                              DEPARTMENT OF DEFENSE
               DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)       ISCR Case No. 10-02113
)
)
Applicant for Security Clearance )
Appearances
For Government: Caroline H. Jeffreys, Esquire, Department Counsel
For Applicant: Pro se
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Decision
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WHITE, David M., Administrative Judge:
Applicant incurred some delinquent debts, including his mortgage, after his wife
lost her job, then chose to separate from him pending divorce. He assumed their joint
obligations on his salary alone, resulting in a temporary inability to remain current on all
debts. His sole remaining delinquency is his mortgage loan, and he is executing a
manageable agreement to bring that current. Based upon a review of the pleadings,
exhibits, and testimony, eligibility for access to classified information is granted. 
Applicant submitted a security clearance application (SF 86) on October 30,
2009. On September 17, 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
Adjudicative Guidelines for Determining Eligibility for Access to Classified Information
effective within the Department of Defense on September 1, 2006. 
GE 1; GE 2; AE C; Tr. 8-10, 37, 96.1
AR.2
GE 3.3
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Applicant answered the SOR in writing (AR) on February 2, 2011, and requested
a hearing before an administrative judge. Department Counsel was prepared to proceed
on March 2, 2011, and the case was assigned to me on April 7, 2011. DOHA issued a
Notice of Hearing on April 18, 2011, and I convened the hearing as scheduled on May
12, 2011. The Government offered exhibits (GE) 1 through 8, which were admitted
without objection. Applicant offered exhibits (AE) A through I, which were admitted
without objection, and testified on his own behalf. I granted Applicant’s request to leave
the record open until June 6, 2011, for submission of additional evidence. DOHA
received the transcript of the hearing (Tr.) on May 24, 2011. On June 2, 2011, Applicant
submitted an additional document that was marked AE J, and admitted without
objection, and the record was closed as scheduled. On July 2 and 7, 2011, Applicant
submitted additional, newly-received documentation pertinent to his case. Department
Counsel had no objection to consideration of this additional evidence. The record was
reopened, the documents were admitted as AE K, and the record was again closed.
Findings of Fact
Applicant is a 40-year-old employee of a defense contractor, where he has
worked as a uniformed security officer since October 2001. He was honorably
discharged from the Marine Corps in July 1997 after 4 years and 4 months of active
enlisted service. He enlisted in the Marine Corps Reserve from February 1998 to March
2006, including a nine-month mobilization to active duty for deployment to Iraq in 2004
and 2005. He has held a security clearance since 1993. He is married but pending
divorce, with a 12-year-old son and a 19-year-old stepdaughter.  In his response to the1
SOR, Applicant denied all but one of the factual allegations in SOR ¶¶ 1.a through 1.f,
and admitted one allegation in part with some explanation.  Applicant’s admissions,2
including his statements in response to DOHA interrogatories,  are incorporated in the3
following findings.
In 2006, Appellant’s wife lost her full-time job. Between then and mid-2009 she
held a couple part-time jobs before resuming full-time employment. During that time
they fell about seven months ($14,578) behind on their mortgage payments. This is the
debt alleged in SOR ¶ 1.d, which had risen to the alleged past-due amount of $29,886
by July 2010. In August 2009, the couple separated. Appellant’s wife kept all her income
to support herself living separately, and Appellant had to meet all the existing household
bills and recurring living and mortgage expenses on his income alone. He began the
process of negotiating an agreement to refinance his mortgage with the lender. Since
then, he has started and stopped several repayment arrangements due to some
misunderstandings concerning what was required. Other than several payments made
under those agreements, Applicant has not made regular mortgage payments since that
time. In February 2010, he was moved from third shift to second shift, which reduced his
AR; GE 3; GE 5 through 8; AE C; AE E; AE K; Tr. 61-62, 68-69, 80-83, 92-102.4
AR; GE 3; GE 5 through 8; AE D; AE J; Tr. 37-47. 5
AR; GE 3; GE 5; GE 6; Tr. 20, 32-33.6
AR; GE 3; AE F; Tr. 50. 7
AR; GE3; GE 5 at 3; GE 7 at 205, 207; AE G; Tr. 51-52, 64. 8
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pay from about $34 per hour to about $28. Depending on overtime availability, this
reduced his income by about $1,000 per month. The lender is not pursuing foreclosure
of this mortgage. By March 2011, the total balance due had risen to $43,000. At the
time of the hearing, Applicant was waiting to hear from the lender concerning a
proposed loan modification. On June 29, 2011, the lender offered Applicant a Special
Forbearance Agreement, which he accepted on July 1, 2011. Under this agreement he
would make one payment of $569 on July 1, and three monthly payments of $1,665 on
the first days of August, September, and October. Following his compliance with this
agreement, the lender will forward him the loan modification papers that should include
a lower interest rate, addition of the past-due amount to the loan principle, and an
extension of the life of the loan to result in affordable monthly payments. Applicant
already committed the funds to make the first three payments, and has sufficient funds
to obligate for the October payment once that comes into the 60-day window in which
the bank will commit funds.  4
Applicant has used the funds he did not pay toward his mortgage to pay off all of
his other debts, including some that also became delinquent. The two medical debts of
$89 and $210, alleged in SOR ¶¶ 1.a and 1.b, were incurred by his wife, and he paid
them in full in May and July 2010. The creditor sent Applicant a letter confirming these
payments in April 2011, and another letter confirming that the debts in question were
identified by different account numbers in the receipt letter and on the credit report.
These debts are resolved, and do not appear on his recent credit reports.  5
The $132 cell phone debt listed in SOR ¶ 1.c was also incurred by his wife. He
paid this debt in July 2010, as confirmed on his March 2011 credit report.  The $6626
delinquent debt to the Veteran’s Administration, alleged in SOR ¶ 1.e, arose because
Applicant had to withdraw from some college classes due to a conflict with his work
schedule. He began repaying the debt in October 2009, and made additional payments
to complete full repayment in November 2009 and March 2010.  The $1,515 debt7
alleged in SOR ¶ 1.f was incurred by his wife while he was deployed in Iraq. He repaid
the debt in full on August 4, 2005, after his return from that deployment.8
Applicant’s financial plan has been to repay all outstanding debts to ensure that
he will have sufficient income to resume regular mortgage payments under the pending
modification agreement. The budgetary information he submitted in seeking the
modification agreement and when responding to DOHA interrogatories indicates that he
will be able to continue carrying out this plan. He also has about $36,000 saved in a
GE 3; GE 4; AE E; Tr. 61-80, 97-105.9
AE A; AE B.10
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retirement plan from which he can obtain a loan should he temporarily need additional
funds. He had some previous financial delinquencies dating back to the period from
2001 to 2003, when his wife was handling their family finances that he also resolved. I
found Applicant to have a comprehensive understanding of his financial situation, and to
be sincere in his resolve to avoid future delinquencies. He was adamant that he felt
honor-bound to repay his creditors and would not seek to avoid doing so through
bankruptcy.9
Applicant’s manager and a coworker wrote letters praising his responsibility,
good work performance, reliability, and general good character.  His demeanor during10
the hearing was pleasant, open, sincere, and straightforward.
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
of Executive Order 10865 provides: “[a]ny determination under this order adverse to an
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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 initial 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.” There is no evidence of frivolous or irresponsible
spending, deceptive or illegal financial practices, or financial issues caused by any
misconduct on Applicant’s part. His SOR-alleged financial problems began around 2006
when his wife lost her full-time job and their family had to subsist primarily on his
income. Shortly after she found another full-time job in 2009, she began a separation
pending divorce. She earned enough to establish separate living arrangements, but left
him to address all joint obligations. The debts alleged in the SOR, as well as some
others that Appellant had already resolved, became delinquent as a result of these
circumstances. The five SOR-listed debts that Appellant fully repaid between August
2005 and July 2010 (two months before DOHA issued the SOR) totaled only $2,600.
More than $1,500 of that total was repaid in 2005. The only real concern at the time of
the hearing was the state of Applicant’s mortgage loan. His mortgage lender has since
offered him a forbearance agreement in anticipation of an approved loan modification,
which will bring that debt back into good standing with payments he will be able to
afford. The evidence establishes Applicant’s temporary inability to satisfy some of his
debts and his brief history of not meeting financial obligations, thereby shifting the
burden to him to prove mitigation.
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The guideline includes five 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; 
(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 incurred a relatively modest amount of delinquent debt when he had to
assume financial responsibility for all family debt on his income alone. When he and his
wife separated, he assumed responsibility for their joint obligations. He has now paid
them, and has reached an agreement with the lender to resolve his sole remaining
delinquent debt through a mortgage modification plan. He lives frugally, and is
determined to fulfill his present and future financial obligations. His separation and
pending divorce prevent his wife from causing him further financial problems. The
evidence establishes significant mitigation under AG ¶ 20(a).
Mitigation under AG ¶ 20(b) was also established. Applicant’s financial problems
were caused by his wife’s unexpected loss of employment and subsequent decision to
separate and seek a divorce. He applied his available financial resources to cover as
many obligations as possible, but fell behind on his mortgage as a result. He has
remained in contact with his mortgage lender throughout the time his loan payments
have been delinquent, making several attempts to implement a plan to bring the loan
into a current status. He is currently implementing an approved plan with the lender, and
has sufficient resources to do so after resolving all his other delinquent debt. 
Applicant has not undergone personal financial counseling, but he offered
documentation to establish clear indications that the problem is being resolved and is
under control. He had fully repaid five of the six SOR-listed debts in good faith several
ISCR Case No. 06-12930 at 2 (App. Bd. Mar. 17, 2008) (quoting ISCR Case No. 04-09684 at 2-3 (App.11
Bd. Jul. 6, 2006)). 
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months before DOHA issued the SOR, and is successfully implementing an agreement
with his mortgage lender to bring that loan back into good standing within a few months.
Thus, substantial mitigation was also established under AG ¶¶ 20(c) and (d).
Applicant did not dispute that he formerly owed any of the debts alleged in the
SOR, so AG ¶ 20(e) has no relevance in this case. 
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 demonstrated a very reasonable plan to continue resolving11
his debts within his means, and has been implementing that plan very successfully over
the past several years. 
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 is a hard-working
and dedicated employee. He had fully repaid five of the six SOR-alleged delinquent
debts several months before the SOR was issued, and has since reached a reasonable
and manageable agreement to bring his mortgage debt into good standing. He has
sufficient income and savings to continue resolution of his one remaining delinquent
debt without the risk of incurring additional debt. 
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Applicant is a mature and experienced individual, who is fully accountable for his
situation and intends to continue resolving his obligations. The potential for pressure,
coercion, exploitation, or duress is minimal, and he has demonstrated a sufficient
pattern of financial responsibility to show that the financial concerns are unlikely to
continue or recur. 
Overall, the record evidence creates substantial confidence as to Applicant’s
present eligibility and suitability for a security clearance. He fully met 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: FOR APPLICANT
Subparagraphs 1.a through 1.f: For Applicant
Conclusion
In light of all of the circumstances presented by the record in this case, it is
clearly consistent with the interests of national security to grant Applicant eligibility for a
security clearance. Eligibility for access to classified information is granted.
                                              
DAVID M. WHITE
Administrative Judge