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                        DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
----------------------- )       ISCR Case No. 11-03827
)
Applicant for Security Clearance )
Appearances
For Government: Eric H. Borgstrom, Esquire, Department Counsel
For Applicant: Pro se
                                                                            
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Decision
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MARSHALL, Jr., Arthur E., Administrative Judge:
On July 1, 2011, 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). 
In an August 6, 2011, response, Applicant admitted the 28 allegations raised
under Guideline F and requested a hearing before a DOHA administrative judge. DOHA
assigned the case to another administrative judge on October 13, 2011, but it was
transferred to me on December 14, 2011, for caseload considerations. The parties
proposed a hearing date of January 31, 2012. A notice setting that date for the hearing
was issued on January 6, 2011. I convened the hearing as scheduled. 
Applicant gave testimony and offered three documents, which were accepted
without objection as exhibits (Exs.) A-C. The Government introduced eight documents,
which were accepted into the record without objection as Exs. 1-8. The transcript (Tr.)
of the proceeding was received on February 8, 2012. The record was then closed.
 Hereinafter,  Applicant’s wife, ex-wife, and fiancee refer to the same woman at different points in their      1
relationship. 
 Tr. 30.      2
 Ex. 1 (Application) at 23 of 48.      3
 Tr. 19, 21-22, 27. See also Tr. 37, 44 (Applicant’s ex-wife attributes the debts at issue to her shopping and      4
vacations). 
 Tr. 21-24.      5
 Tr. 34.      6
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Based on a review of the testimony, submissions, and exhibits, I find Applicant failed to
meet his burden of mitigating security concerns related to financial considerations.
Clearance is denied.
Findings of Fact
Applicant is a 36-year-old mechanical installer who has worked for the same
defense contractor since January 2011. He is a high school graduate. Applicant has
extensive technical training and multiple certifications in the field of construction, as well
as certification as a casino games dealer. He is currently planning on remarrying his ex-
wife. The couple has two minor children. 
In 1997, Applicant met his now ex-wife.  At the time, Applicant had perfect1
credit.  They had their first child at the end of the following year. When his then-fiancee2
lost her job, the couple moved in with her parents to save money. She stayed at home
to raise their eldest child and return to school instead of starting a new job. Applicant’s
wife wanted to move from her parents’ home and encouraged Applicant into buying
them a house. After that, Applicant’s then-fiancee decorated and improved their home,
usually without Applicant’s participation in the acquisition of additions. She regularly
used credit cards in Applicant’s name and managed the household accounts. The
couple married in January 2002.3
By the time the couple married, Applicant had acquired sufficient debt that he
refinanced their home in order to pay off some of their debts. When that effort proved to
be insufficient, he filed for Chapter 7 bankruptcy protection. The petition included
approximately $71,080 in debt and was discharged in December 2002. 
Applicant’s ex-wife is a “shopaholic.”  Her unbridled spending would eventually4
lead to much of the debt at issue. Applicant, who did not manage the family accounts,
was unaware of much of this new debt.  When Applicant would see his wife’s new5
purchases, “he complained and he got mad about it, but [she] did it anyway. Stuff that
[she felt that they] needed at the time.”6
 Tr. 27.      7
 Tr. 54.      8
 Tr. 24. Applicant does not recall the last time he made a payment on the mortgage associated with this      9
property. The SOR at ¶ 1.y reflects a past-due balance of approximately $9,000. Tr. 52-53. 
 Tr. 61.      10
 Tr. 26.      11
 Tr. 41-42.      12
 Tr. 29.      13
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The couple bought two used vehicles in 2005. One vehicle was purchased in
Applicant’s former wife’s name, but the associated debt was eventually attributed to
him.  Applicant’s former wife continued to make purchases on numerous credit cards.7
She returned to work, but had lost her job by the time they divorced in 2007. Applicant
took custody of their child. In mid-2008, their second child was born. 
In July 2008, Applicant petitioned for Chapter 13 bankruptcy, noting about
$72,250 in assets and approximately $116,876 in debt. Applicant was laid off from his
position as a laborer in August 2008, shortly after “a few” months off from work for
medical reasons.  He depleted his 401K plan and took part-time jobs to help pay for his8
expenses. Applicant was able to make payments on his bankruptcy plan for about a
year. He again found work in March 2010 at a casino. By November 2010, his petition
was dismissed for failure to make payments in accordance with the bankruptcy plan. 
In the interim, Applicant and his ex-wife reconciled in late 2009, at which point
his ex-wife quit working. In late 2010, they abandoned their mortgaged home in one
state to relocate to their current state of residence so that Applicant could find a better-
paying job.  He was offered his present position in November 2010. Since January9
2011, Applicant has been steadily employed. He and his ex-wife are looking forward to
remarrying. 
Applicant is now settled and anticipating remarriage to his ex-wife. He
acknowledges that her abuse of credit cards significantly helped lead to his past
bankruptcy petitions. He is relying on trust that she will not again abuse credit cards.10
Applicant is hoping to resolve his old delinquent debts through Chapter 7 bankruptcy.11
His fiancee has a college degree in business management with a minor in accounting,
but hopes to remain at home for a couple of years to reconnect with her children. Their
prior home in their former city of residence remains unoccupied and unmaintained.
They anticipate that foreclosure proceedings will eventually commence.
Although he and his ex-wife are trying to budget, Applicant does not currently
earn sufficient funds to cover his family’s monthly expenses.  He does not currently12
have the money to proceed with a bankruptcy filing with his attorney.  His current13
 Id.      14
 Id.      15
 Tr. 51.      16
 Tr. 32. Applicant testified that the debt noted at SOR allegation ¶ 1.j for $775 should have been included      17
in his 2002 bankruptcy discharge, but provided no evidence showing that it was included in that petition. See
Tr. 50-51.
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income is “not cutting it.”  He is currently anticipating six weeks of temporary disability14
insurance payments due to tendinitis. At the time of the hearing, they were living off of
Applicant’s last pay check, which was received two weeks earlier; Applicant did not
have sufficient funds to pay for heating oil at their current home.  Applicant received15
financial counseling in the past, in connection with his 2002 and 2008 bankruptcy
filings. Neither Applicant nor his ex-wife currently use credit cards. Applicant feels that
because he is comfortable at his current position and well-regarded at work that he will
succeed. 
At issue in the SOR are the two bankruptcy filings and 26 debts, amounting to
approximately $69,700. They range from $23 to $17,325, with nine being for sums
under $500. Applicant admits the debts are his. Although he disputes the actual
amounts owed on many of the debts, he provided no evidence showing that the sums
reflected in the SOR are incorrect. Applicant admits that no payments have been paid
on the debts noted in the SOR.  The debts at issue were originally included in the16
dismissed 2010 Chapter 13 bankruptcy petition that was filed in July 2008, shortly
before Applicant was laid off from his position as a laborer in August 2010.  17
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
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.
 See also ISCR Case No. 94-1075 at 3-4 (App. Bd. Aug. 10, 1995).      18
 ISCR Case No. 93-1390 at 7-8 (App. Bd. Jan. 27, 1995).      19
 Id.      20
 Id.      21
 AG ¶ 18.      22
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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 a18
preponderance of evidence. The ultimate burden of persuasion is on the applicant.  19
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 those 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 access20
to sensitive information must be resolved in favor of protecting such sensitive
information.21
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.
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.”  It22
 Id.      23
 Applicant also cites to a period of medical convalescence lasting “a few” months in 2008 as the root of      24
the debts at issue. However, that period without income occurred shortly before he was laid off from work in
August 2008, a month after he filed for Chapter 13 bankruptcy in July 2008. Therefore, it is difficult to discern
how much debt, if any, attributable to that period could have been included in the bankruptcy petition.
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also states that “an individual who is financially overextended is at risk of having to
engage in illegal acts to generate funds.”  The Government’s evidence showed that23
Applicant owes about $70,000. Although Applicant suggests that the balances owed
are lower than represented by the SOR, he presented scant evidence to reduce this
sum. He is now poised to again file for bankruptcy and remarry his former spouse, who
admits to being the source of much of Applicant’s admitted debt. Such facts are
sufficient to raise 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 him and mitigate security concerns. 
The debts at issue are multiple in number and remain largely unpaid. There is no
evidence that either Applicant or his ex-wife have effectively received financial
counseling that has helped them keep Applicant from generating more debt. Due to
insufficient savings, Applicant has yet to re-petition for bankruptcy in an attempt to
eliminate his current debt. The main explanation for the genesis of the debt at issue is
Applicant’s ex-wife’s continual overspending.  While there is no evidence that24
Applicant, himself, has generated significant debt, his fiancee and current co-habitant
openly admits responsibility for most of Applicant’s debt, including a vehicle that was
initially taken in her name. Applicant disputes some of the balances of the debts at
issue, but presented scant evidence to show that the balances alleged are not
sufficiently reduced. Even if the sum of the debt was shown to be reduced to a quarter
of what they are shown to be in the SOR, the remaining sum is highly significant, and
the need to file for a third bankruptcy remains worrisome. Without some demonstration
that Applicant has reigned in responsibility for the debts acquired in his name, none of
the mitigating conditions 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.
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Applicant is a 36-year-old father of two who is planning to remarry his ex-wife. During
their early courtship, his then-fiancee abused his credit cards and acquired sufficient
debt that Applicant declared Chapter 7 bankruptcy in the same year they married. After
they married, Applicant’s wife, who managed the household accounts, continued to
abuse credit cards. A self-described “shopaholic,” she admits that most of the debt that
would ultimately be included in Applicant’s July 2008 bankruptcy petition was
attributable to her shopping and vacations. Applicant suggests that some of that debt
may have been attributable to his medical leave shortly before he was laid off from a
job in August 2008. However, Applicant provided no evidence linking his debts with that
period in time, and the chronology leaves only a small window of time before the July
2008 petition for his acquisition of delinquent debt during a convalescence of “a few”
months.
Today, Applicant is preparing to remarry his ex-wife. They have not recently
received financial counseling or articulated a method to avoid encountering financial
issues in the future. Although her “shopaholic” nature has twice led him to bankruptcy,
he intends to rely on trust and the absence of current credit cards to prevent future
misspending. He enjoys his current position and believes he has a future with his
present employer. However, he does not presently earn sufficient income to meet his
family’s needs. Applicant is relying on the prospect of a third bankruptcy filing to
eliminate the debt presently at issue. Meanwhile, his former home remains unmanaged
and poised for foreclosure. 
Although one of the 26 debts at issue may have been included in Applicant’s
2002 Chapter 7 bankruptcy discharge, none of the other debts have been paid, formally
disputed, or otherwise addressed since 2008, when Applicant filed for Chapter 13
bankruptcy. He has been employed since that bankruptcy was dismissed in November
2010, yet multiple debts between $23 and $500 remain unaddressed. This process
does not demand that every debt at issue be paid. It does, however, require that an
Applicant have a reasonable and workable plan for eliminating his debt, and a
demonstration that such a plan has been implemented. Here, Applicant’s plan is to
once again file for bankruptcy. As the sole source of family income at present, however,
he lacks the funds to proceed with another bankruptcy filing at this time. Absent some
showing that the significant debt at issue is poised for resolution with some indication
that Applicant will not again fall prey to delinquent debt, financial considerations security
concerns remain unmitigated. As noted, any reasonable doubt about whether an
applicant should be allowed access to sensitive information must be resolved in favor of
protecting such sensitive information. 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.bb: Against Applicant
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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