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                           DEPARTMENT OF DEFENSE 
         DEFENSE OFFICE OF HEARINGS AND APPEALS 
           
             
 
 
In the matter of: ) 
 ) 
  )  ISCR Case No. 11-04831 
  )   
 ) 
Applicant for Security Clearance ) 
 
 
Appearances 
 
For Government: Gregg A. Cervi, Esq., Department Counsel 
For Applicant: Pro se 
 
 
March 20, 2012 
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Decision 
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GOLDSTEIN, Jennifer I., Administrative Judge: 
 
Applicant has a long history of financial indebtedness. He currently has 18 
delinquent debts, and has failed to submit proof that any of them are satisfied. He has 
not mitigated the Financial Considerations security concerns. Eligibility for access to 
classified information is denied.  
 
Statement of the Case 
 
On October 26, 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. The action was taken under Executive Order 
(EO) 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 
revised adjudicative guidelines (AG) effective on September 1, 2006.  
 
 Applicant answered the Statement of Reasons (SOR) in writing on October 6, 
2011, and elected to have the case decided on the written record in lieu of a hearing. 
 
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Department Counsel submitted the Government’s written case on November 17, 2011. 
A complete copy of the file of relevant material (FORM) was received by Applicant on 
January 26, 2012. He was afforded a 30-day opportunity to file objections and submit 
material to refute, extenuate, or mitigate the security concerns. As of February 27, 2012, 
he had not responded. The case was assigned to me on March 13, 2012. 
 
Findings of Fact 
 
 Applicant is a 57-year-old employee of a defense contractor. He has worked for 
his current employer from October 2009 to present. He honorably served in the U.S. Air 
Force from 1972-1974, and reported he previously held a security clearance in 1972. 
He is married and has three children, ages 13, 23, and 33. (Item 4; Item 5.) 
 
 In November 2007, Applicant was laid-off from his job. He was unable to find a 
full-time position until October 2009. During the time he was unemployed, his family 
lived on his wife’s income and profits from odd jobs he performed. He was unable to 
satisfy all of his financial obligations with his reduced income. In February 2011, after he 
had been fully employed for over a year, he hired a law firm to assist him with 
contesting debts and repairing his credit. He agreed to pay the firm $2,850 between 
February 2010 and May 15, 2011 to manage his debt. However, Applicant failed to 
introduce evidence that any of his debts were resolved through the law firm or any other 
means. Applicant’s credit reports dated August 23, 2011, July 31, 2011, and December 
24, 2010 establish that he is indebted to 18 creditors in the approximate amount of 
$36,072. Applicant’s debts are as follows. (Item 6; Item 7.) 
 
 Applicant is indebted to a medical creditor in the amount of $76, as stated in 
SOR ¶ 1.a. Applicant admits this debt. He indicated this debt was for his co-payment for 
ex-rays. He indicated he was waiting for the attorney assisting him with his debt 
management to help him address this debt. (Item 7; Item 8.) 
 
 Applicant is indebted to a medical creditor in the amount of $93, as stated in 
SOR ¶ 1.b. Applicant admits this debt. Applicant claims the hospital has no record of 
this debt, but he failed to produce any documentation from the hospital verifying his 
assertion. (Item 7.) 
 
 Applicant is indebted to a collection agent for a telecommunications company in 
the approximate amount of $235, as stated in SOR ¶ 1.c. Applicant admits this debt. 
Applicant failed to present documentation that he has paid or otherwise addressed this 
debt. (Item 8.) 
 
 Applicant is indebted on a charged off account in the approximate amount of 
$746, as stated in SOR ¶ 1.d. Applicant admits this debt. Applicant failed to present 
documentation that he has paid or otherwise addressed this debt. (Item 8.) 
 
 Applicant is indebted on a charged off account in the approximate amount of 
$181, as stated in SOR ¶ 1.e. Applicant denies this debt. He indicated this debt was for 
 
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an air conditioner and that he would be paying off this debt in July 2011. He presented 
no proof of payment. (Item 6; Item 7.) 
 
 Applicant is indebted on a collections account in the approximate amount of 
$2,308, as stated in SOR ¶ 1.f. Applicant admits this debt. He indicated he was waiting 
for the attorney assisting him with his debt management to help him address this debt. 
(Item 7; Item 8.) 
 
 Applicant is indebted on a collections account in the approximate amount of 
$2,367, as stated in SOR ¶ 1.g. Applicant denies this debt. Applicant indicated he has 
no idea how he incurred this debt. He presented no documentation establishing that he 
has contested this debt or otherwise resolved this account. (Item 7.) 
 
 Applicant is indebted on a collections account in the approximate amount of 
$1,281, as stated in SOR ¶ 1.h. Applicant admits this debt. Applicant indicated he has 
no idea how he incurred this debt. He presented no documentation establishing that he 
has contested this debt or otherwise resolved this account. (Item 7.) 
 
 Applicant is indebted on a collections account in the approximate amount of 
$2,478, as stated in SOR ¶ 1.i. Applicant admits this debt. He believes the account was 
for a gas card, but claims that he never had a gas card. He presented no documentation 
establishing that he has contested this debt or otherwise resolved this account. (Item 7.) 
 
 Applicant is indebted on a charged-off account in the approximate amount of 
$5,493, as stated in SOR ¶ 1.j. Applicant admits this debt. This debt was for a credit 
card account. Applicant indicated he tried to make payments on this debt but that the 
creditor engaged in “deceptive business practices.” He presented no documentation 
establishing that he has contested this debt or otherwise resolved this account. (Item 7.) 
 
 Applicant is past due on his home loan in the approximate amount of $12,440, as 
stated in SOR ¶ 1.k. Applicant admits this debt. He indicated he incurred this debt by 
falling behind on one payment. He indicated he was waiting for the attorney assisting 
him with his debt management to help him address this debt. (Item 7.) 
 
 Applicant is indebted on a medical collections account in the approximate 
amount of $64, as stated in SOR ¶ 1.l. Applicant admits this debt. Applicant indicated he 
has no idea how he incurred this debt. He presented no documentation establishing that 
he has contested this debt or otherwise resolved this account. (Item 7.) 
 
 Applicant is indebted on a medical collections account in the approximate 
amount of $2,200, as stated in SOR ¶ 1.m. Applicant denies this debt. Applicant 
indicated he has no idea how he incurred this debt. He presented no documentation 
establishing that he has contested this debt or otherwise resolved this account. (Item 7.) 
 
 Applicant is indebted on a medical collections account in the approximate 
amount of $184, as stated in SOR ¶ 1.n. Applicant admits this debt. This debt was for a 
 
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hospital bill that Applicant disputes. He presented no documentation establishing that he 
has contested this debt or otherwise resolved this account. (Item 7.) 
 
 Applicant is indebted on a collections account in the approximate amount of 
$2,077, as stated in SOR ¶ 1.o. Applicant admits this debt. He presented no 
documentation establishing that he has contested this debt or otherwise resolved this 
account. (Item 7.) 
 
 Applicant is indebted on a medical collections account in the approximate 
amount of $279, as stated in SOR ¶ 1.p. Applicant admits this debt. He presented no 
documentation establishing that he has contested this debt or otherwise resolved this 
account. (Item 7.) 
 
 Applicant is indebted on a collections account in the approximate amount of 
$2,191, as stated in SOR ¶ 1.q. Applicant denies this debt. He claims he is disputing 
this debt. He presented no documentation establishing that he has contested this debt 
or otherwise resolved this account. (Item 7.) 
 
 Applicant is indebted on a collections account in the approximate amount of 
$1,379, as stated in SOR ¶ 1.r. Applicant denies this debt. He presented no 
documentation establishing that he has contested this debt or otherwise resolved this 
account. (Item 7.) 
 
Policies 
 
 When evaluating an applicant’s suitability for a security clearance, the 
administrative judge must consider the revised adjudicative guidelines (AG). In addition 
to brief introductory explanations for each guideline, the adjudicative guidelines list 
potentially disqualifying conditions and mitigating conditions, 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, administrative judges apply the guidelines in 
conjunction with the factors listed in the adjudicative process. The administrative judge’s 
overarching adjudicative goal is a fair, impartial, and commonsense decision. According 
to AG ¶ 2(c), the entire process is a conscientious scrutiny 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 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. 
 
 
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Under Directive ¶ E3.1.14, the government must present evidence to establish 
controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, the 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.” The 
applicant has the ultimate burden of persuasion to obtain a favorable security decision.  
 
 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 as to 
potential, rather than actual, risk of compromise of classified information. 
 
Section 7 of EO 10865 provides that adverse 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).   
 
Analysis 
 
Guideline F, Financial Considerations 
 
The security concern for Financial Considerations is 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 guideline notes several conditions that could raise security concerns under 
AG ¶ 19. Two are potentially applicable in this case:   
 
 (a) inability or unwillingness to satisfy debts; and 
 
 (c) a history of not meeting financial obligations. 
 
 Applicant accumulated a number of delinquent debts and has been unable or 
unwilling to pay his obligations. Further, his financial problems have been ongoing for at 
least the past five years, without resolution. The evidence is sufficient to raise the above 
disqualifying conditions. 
  
 
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  Five Financial Considerations Mitigating Conditions under AG ¶ 20 are potentially 
applicable:  
 
(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. 
 
 The evidence does not show that Applicant has resolved any of the 18 debts 
alleged in the SOR. His financial issues are recent and ongoing. AG ¶ 20(a) is not 
applicable.  
 
 AG ¶ 20(b) is not applicable. Applicant did have a two-year period of 
unemployment due to his lay-off. However, to be fully applicable, AG ¶ 20(b) also 
requires that the individual act responsibly under the circumstances. Applicant has 
worked for his current employer since October 2009. He did not submit evidence of any 
payments, even on the smallest debts. He did not present a plan on how he will address 
his delinquent debts, other than to contract an attorney in 2011. He failed to provide 
evidence to show any recent progress in addressing his debts. I am unable to make a 
determination that he acted responsibly under the circumstances.  
 
 Applicant did not produce any evidence to suggest he attended any financial 
counseling. Further, there is little indication that Applicant’s delinquent accounts are 
being resolved or are under control. AG ¶ 20(c) does not apply. 
 
 Applicant has not made a good-faith effort to pay or resolve his delinquent debts. 
The record fails to establish that any payments have been made any of his 18 debts. 
AG ¶ 20(d) is not applicable. 
 
 
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 Applicant disputed owing the debt alleged in 1.e, 1.g, 1.m, 1.q, and 1.r. in his 
answer to the SOR. However he presented no evidence to show that he was in the 
process of disputing this debt or that he had successfully disputed this debt in the past. 
He hired an attorney to assist him with his debts, but he failed to document any actions 
that attorney has taken on his behalf. AG ¶ 20(e) is inapplicable.  
 
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 the 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 
the facts and circumstances surrounding this case. I have incorporated my comments 
under Guideline F in my whole-person analysis. Some of the factors in AG ¶ 2(a) were 
addressed under that guideline, but some warrant additional comment. Applicant is 57 
years old. He is clearly aware of the need to be financially responsible. He has had 
ample opportunity to address his financial delinquencies since becoming gainfully 
employed, but has failed to do so. 
 
Overall, the record evidence leaves me with questions and doubts as to 
Applicant’s eligibility and suitability for a security clearance. For all these reasons, I 
conclude Applicant has not mitigated Financial Considerations security concerns.  
 
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.r:   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 the national interest to grant or continue Applicant’s eligibility for 
a security clearance. Eligibility for access to classified information is denied. 
                                                
 
 
________________________ 
Jennifer I. Goldstein 
Administrative Judge