Consisting of the transcript (Tr.), Government exhibits (GE) 1-4, and Applicant exhibits (AE) A-H.1
DOHA acted under Executive Order 10865, Safeguarding Classified Information within Industry (February2
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 1 September 2006. 
1
                                                             
                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)       ISCR Case No. 10-10581
)
Applicant for Security Clearance )
Appearances
For Government: Tovah A. Minster, Esquire, Department Counsel
For Applicant: Tori D. Bramble, Esquire    
______________
Decision
______________
METZ, John Grattan, Jr., Administrative Judge:
Based on the record in this case,  Applicant’s clearance is granted.1
On 23 August 2011, the Defense Office of Hearings and Appeals (DOHA) issued
a Statement of Reasons (SOR) to Applicant detailing security concerns under Guideline
F, Financial Considerations.  Applicant timely answered the SOR, requesting a hearing.2
DOHA assigned the case to me 6 October 2011, and I convened a hearing 15
November 2011. DOHA received the transcript (Tr.) 23 November 2011.
 
2
Findings of Fact
Applicant admitted the SOR allegations except for SOR 1.b and 1.c. He is a 41-
year-old senior systems analyst employed by a defense contractor since May 2010. He
has not previously held an industrial security clearance, but had one from 1979 to 1989
when he served in the military.
The SOR alleges, and Government exhibits confirm, seven delinquent debts
totaling nearly $95,000. Applicant admits five debts totaling nearly $27,000. After years
of trying to get the debts under control, Applicant and his wife filed for chapter 13
bankruptcy protection in September 2011 (AE C). The plan, yet to be confirmed,
proposes to pay $456.50 per month for five years, for a total of almost $27,400, to
resolve his indebtedness. He has made the first two required payments (AE H).
Applicant graduated from a U.S. military academy in 1979, and served on active
duty until 1989, during which he held the top secret clearance required to work with
nuclear propulsion systems. After leaving the military in 1989, Applicant went to work for
a non-profit organization. In May 1996, he took a promotion with the organization that
required him to move to another state. His wife of 17 years did not relocate with him,
although at the time he expected she would eventually do so. In 2001, he realized that
she was never going to relocate and he filed for divorce. The divorce was final in March
2004, and he remarried later that month.
In August 2005, Applicant accepted another promotion and relocation with the
non-profit, on a four-year contract expiring in August 2009. Applicant might have
renewed his contract, but wanted to move on to other challenges. To accommodate the
non-profit, Applicant resigned from his position in June 2009, so the organization could
hire his replacement. The organization gave him a small severance package. Applicant
wanted to remain in the non-profit field, but with the declining economy, he was unable
to do so. He was unemployed from June 2009 until May 2010, when he relocated to
take his present job.
Applicant and his wife began having financial problems around 2007. Non-profit
salaries are not high, and Applicant’s wife was a real estate agent experiencing reduced
income with the decline in the housing market. They refinanced their house through a
“friend,” but instead of getting a lower mortgage payment, the payments increased.
They did an in-house refinance with another bank, but after making required payments,
the bank would not convert the mortgage to a regular mortgage. Applicant and his wife
put the house up for sale. The house eventually sold with a shortfall of about $63,000
(SOR 1.b).
In August 2007, Applicant and his wife contracted with a debt reduction company
(AE B) that turned out to be a scam. The state attorney general filed suit against the
company in February 2008, but by the time Applicant and his wife discovered that fact,
they had paid the company about $4,100 for debt relief the company never produced.
However, the state was able to obtain a $1,700 recovery for them. In September 2011,
See, Department of the Navy v. Egan, 484 U.S. 518 (1988).3
3
Applicant and his wife consulted a more creditable financial counselor, but they were
unable to afford the $1,900 monthly payments in the counselor’s proposed plan (Tr. 63;
AE E), particularly where the plan did not include the mortgage shortfall. They realized
that their only sensible solution was to pursue the chapter 13 debt reorganization.
Applicant’s supervisor—a classmate of his from the military academy who
reconnected with Applicant at their 30  class reunion in 2009—considers Applicantth
honest and trustworthy. His supervisor notes that the Government client is so pleased
with Applicant’s work that he has been assigned two additional projects to the one he
was originally hired to work on. Applicant and his wife have a budget and are current on
their day-to-day expenses.
Policies
The adjudicative guidelines (AG) list factors for evaluating a person’s suitability
for access to classified information. Administrative judges must assess disqualifying and
mitigating conditions under each issue fairly raised by the facts and situation presented.
Each decision must also reflect a fair, impartial, and commonsense consideration of the
factors listed in AG ¶ 2(a). Any one disqualifying or mitigating condition is not, by itself,
conclusive. However, specific adjudicative guidelines should be followed where a case
can be measured against them, as they represent policy guidance governing access to
classified information. Considering the SOR allegations and the evidence as a whole,
the relevant adjudicative guideline is Guideline F (Financial Considerations).
Security clearance decisions resolve whether it is clearly consistent with the
national interest to grant or continue an applicant’s security clearance. The Government
must prove, by substantial evidence, controverted facts alleged in the SOR. If it does,
the burden shifts to applicant to refute, extenuate, or mitigate the Government’s case.
Because no one has a right to a security clearance, the applicant bears a heavy burden
of persuasion.
Persons with access to classified information enter into a fiduciary relationship
with the Government based on trust and confidence. Therefore, the Government has a
compelling interest in ensuring each applicant possesses the requisite judgement,
reliability, and trustworthiness of those who must protect national interests as their own.
The “clearly consistent with the national interest” standard compels resolution of any
reasonable doubt about an applicant’s suitability for access in favor of the government.3
Analysis
The Government established a case for disqualification under Guideline F, but
Applicant mitigated the security concerns. Applicant and his wife experienced financial
problems when the declining real estate market reduced his wife’s income. The
problems were exacerbated by two failed refinances of their home, the short sale of that
¶ 19.(a) inability or unwillingness to satisfy debts; (c) a history of not meeting financial obligations;4
¶ 20 (a) the behavior happened so long ago, was so infrequent, or occurred under such circumstances that5
it is  unlikely to recur . . . 
¶ 20.(b) the conditions that resulted in the financial problem were largely beyond the person’s control . . . and6
the individual acted responsibly under the circumstances;
¶ 20.(c) the person has received or is receiving counseling for the problem and there are clear indications7
that the problem is being resolved or is under control;
¶ 20.(d) the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.8
4
home, and a failed effort at debt consolidation due to the vendor’s fraud.  However, the4
SOR debt has now been consolidated into a chapter 13 debt reorganization and
Applicant has made the first two payments pending confirmation of the plan.
Applicant meets significant mitigating factors for financial considerations. While
his financial difficulties are recent, they were limited to the seven debts alleged, and the
circumstances under which they occurred are unlikely to recur.  Applicant and his wife5
proceeded reasonably in trying to refinance their home to cut their expenses and in
retaining what they considered a legitimate debt consolidator. The failure of these two
efforts were beyond their control, as was Applicant’s extended unemployment from
June 2009 to May 2010.  Applicant and his wife consulted another credit counselor and6
only turned to the chapter 13 bankruptcy petition when it was clear that they could not
meet the payments proposed by the counselor. Further, it does not appear that
Applicant and his wife were living beyond their means in any regard.  Finally, Applicant7
and his wife did not resort to a chapter 7 bankruptcy petition that would have discharged
all their debt, but filed a chapter 13 debt reorganization which will see them repay over
$27,000 of their delinquent debt over the next five years.  Applicant’s budget provides8
for the bankruptcy payments, and given his past efforts to resolve his debts short of
bankruptcy, the record does not suggest that Applicant’s financial problems will recur.
Accordingly, I conclude Guideline F for Applicant.
Formal Findings
Paragraph 1. Guideline F: FOR APPLICANT
Subparagraphs a-g: For Applicant
5
Conclusion
Under the circumstances presented by the record in this case, it is clearly
consistent with the national interest to grant or continue a security clearance for
Applicant. Clearance granted.   
                                              
                                             
JOHN GRATTAN METZ, JR
Administrative Judge