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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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-------------- )       ISCR Case No. 10-06091
)
)
Applicant for Security Clearance )
Appearances
For Government: Jeff Nagel, Esquire, Department Counsel
For Applicant: Pro se
April 25, 2012
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Decision
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MOGUL, Martin H., Administrative Judge:
On October 14, 2011, the Defense Office of Hearings and Appeals (DOHA)
issued a Statement of Reasons (SOR) detailing the security concerns under Guideline F
for Applicant. 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
(AG), effective within the Department of Defense for SORs issued after September 1,
2006. 
 
On November 16, 2011, Applicant replied to the SOR (RSOR) in writing, and he
requested a hearing before an Administrative Judge. I received the case assignment on
January 20, 2012. DOHA issued a notice of hearing on January 24, 2012, and the
hearing was convened as scheduled on February 14, 2012. The Government offered
Exhibits 1 through 6, which were received without objection. Applicant testified on his
own behalf and submitted Exhibits A through H at the time of hearing, which were also
admitted without objection. DOHA received the transcript of the hearing (Tr) on
February 27, 2012. I granted Applicant’s request to keep the record open until February
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29, 2012, to submit additional documents, and additional documents that were received
have been identified and entered into evidence without objection as Exhibits I through
N. Based upon a review of the pleadings, exhibits, and the testimony of Applicant,
eligibility for access to classified information is granted.
Findings of Fact
In his RSOR, Applicant admitted SOR allegations 1.a., b., c., d., e., and f., and
denied 1.g., and h. The admitted allegations are incorporated herein as findings of fact. 
After a complete and thorough review of the evidence in the record, including
Applicant's RSOR, the admitted documents, and the testimony of Applicant, and upon
due consideration of that evidence, I make the following additional findings of fact: 
Applicant is 30 years old. He is not currently married, and he has no children.
Applicant graduated high school and attended some college. He was born in Bolivia,
and came to the United States in 1985. He became a United States citizen in 2011.
Applicant served in the United States Marine Corps (USMC) from 2002 to 2008 and
received an Honorable Discharge. Applicant is employed by a defense contractor, and
he seeks a DoD security clearance in connection with his employment in the defense
sector.
Guideline F, Financial Considerations
The SOR lists eights allegations (1.a. through h.) regarding overdue debts under
Adjudicative Guideline F. The allegations will be discussed below in the same order as
they were listed on the SOR:
1.a. This overdue debt is cited in the SOR in the amount of $6,927. As reviewed
above, Applicant admitted this allegation in his RSOR. Applicant testified that since the
SOR was issued he has engaged the services of a credit counseling group (CCG) to
help him resolve his debts and has paid them $800. At the time of the hearing that debt
was still unpaid. (Tr at 27-30.) Exhibit A is a letter from this CCG indicating that they
have been employed by Applicant to “remove negative items currently being reported
on his credit report erroneously.”  Exhibit K is a letter from the CCG to the credit
reporting agencies, dated February 22, 2012, challenging seven debts listed on the
SOR, including the debt listed as 1.a. No evidence of a response was introduced. I find
that this debt is unresolved. 
1.b. This overdue debt is cited in the SOR in the amount of $6,933.  As reviewed
above, Applicant admitted this allegation in his RSOR. At the hearing, Applicant testified
that this debt was paid in full by him on November 16, 2011. (Tr at 30-31.) Exhibit D is a
Form 1099-C from the creditor, showing that this debt has been cancelled. It appears
that this debt has been resolved.
1.c. This overdue debt is cited in the SOR in the amount of $19,148.  As
reviewed above, Applicant admitted this allegation in his RSOR. Applicant testified that
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this debt has not been resolved, and he is waiting for a reply from the creditor.  (Tr at
31.) This debt was challenged by the CCG. (Exhibit K.) I find that this debt is
unresolved. 
1.d. This overdue debt is cited in the SOR in the amount of $5,000.  As reviewed
above, Applicant admitted this allegation in his RSOR. Applicant testified that this debt
is in the process of being settled, and he planned to pay off the debt shortly after the
hearing. (Tr at 31-32.) Exhibit L is a letter from the creditor, dated February 7, 2012,
indicating that this debt would be settled for one lump sum payment from Applicant of
$1,838.67. A receipt voucher shows that Applicant paid that amount to the creditor on
February 22, 2012. I find that this debt has been resolved.
1.e. This overdue debt is cited in the SOR in the amount of $154.  As reviewed
above, Applicant admitted this allegation in his RSOR.  Applicant testified that this debt
has been paid in full. (Tr at 32.) Exhibit C is a letter from the creditor, dated May 24,
2010, indicating that this debt had been paid in full. I find that this debt has been
resolved.
1.f. This overdue debt is cited in the SOR in the amount of $14,285.  As reviewed
above, Applicant admitted this allegation in his RSOR. Applicant testified that this debt
has not been resolved, and he is waiting for a reply from the creditor.  (Tr at 33.) This
debt was challenged by the CCG. (Exhibit K.) I find that this debt is unresolved. 
1.g. This overdue debt is cited in the SOR in the amount of $1,205.  As reviewed
above, Applicant denied this allegation in his RSOR.  Applicant testified that he
contacted this creditor, and the creditor could not identify a debt owed to them by
Applicant. Applicant further testified that he believed this debt was for a ticket, which he
paid in full, but which inadvertently went to collections. (Tr at 33.) Exhibit G is a letter
from the creditor, dated January 30, 2012, stating that they could not locate an account
for Applicant. I find that this debt has been resolved.
1.h. This overdue debt is cited in the SOR in the amount of $66.  As reviewed
above, Applicant denied this allegation in his RSOR.  Applicant testified that when he
contacted the creditor for this debt, they informed him that the debt was actually owed
by Applicant’s mother, and the creditor would remove the debt from his credit report. (Tr
at 34.) This debt was not listed on Applicant’s recent credit reports. (Exhibits 4-6 .) I find
that this debt has been resolved.
Applicant testified that his financial problems occurred one year after he left the
USMC, because he was laid off from his private employment for the period of February
to April 2009. He was working two part time jobs to try to earn enough income to pay his
debts, but he was earning less money. (Tr at 35-37.) Applicant testified that prior to his
being laid off, he had not had any financial problems, and he does not have any current
debts on which he is overdue. In his current employment, he is scheduled to deploy for
one year, and he plans to use the extra income he earns during that period to pay off
his debts. (Tr at 48-52.)
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Mitigation
Among the post hearing documents submitted by Applicant was Exhibit M, his
DD Form 214, confirming Applicant served in the USMC from 2002 to 2008, received an
Honorable Discharge, and received a number of Decorations and Medals during his
service. He also submitted Exhibit N, an Equifax credit report dated February 4, 2012,
which does not show any overdue debts that were not listed on the SOR. Exhibit I is
Applicant’s Performance Evaluation from his current employer, and he received all
“Exceptional” or “Very Good” ratings from his manager. He was described as “Very
Reliable and Hard Working.” Exhibit J consisted of three extremely positive character
letters from Applicant’s supervisor and two co-workers. His supervisor described him as
someone who, “has a high level of integrity and well developed sense of responsibility
for any tasks assigned.” Exhibit H had two additional extremely positive
recommendations for Applicant.
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 and mitigating conditions, which are useful 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 the adjudicative process. The administrative judge’s over-arching
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.
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 applicant or proven by Department Counsel. . . .” The
Applicant has the ultimate burden of persuasion as to obtaining a favorable security
decision. 
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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 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.
 
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).  
Analysis
Guideline F, Financial Considerations
The security concern relating to the guideline 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 and
could potentially apply in this case.  Under AG ¶ 19 (a), “an inability or unwillingness to
satisfy debts” is potentially disqualifying. Similarly under AG ¶ 19 (c), “a history of not
meeting financial obligations” may raise security concerns. I find that both of these
disqualifying conditions apply to Applicant in this case. The evidence has established
that Applicant has accumulated significant delinquent debt. 
AG ¶ 20 provides conditions that could mitigate security concerns from financial
difficulties: Under AG ¶  20 (b), it may be mitigating where “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.” As noted
above, Applicant’s financial problems resulted from the time when he became
unemployed and underemployed.  I find that he has acted responsibly, since he has
resolved his smaller debts and has consulted a debt reduction company, paying $800
for their services to attempt to resolve his remaining overdue debts. Therefore, I find
that this mitigating condition is a factor for consideration in this case. 
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I find AG ¶  20(d) is also applicable since Applicant has “initiated a good-faith
effort” to “resolve debts.” I find that this mitigating condition is a factor for consideration
in this case.
Finally, I conclude that Applicant is maintaining more financial stability and not
incurring additional overdue debts since he obtained his current employment. Therefore,
Applicant has mitigated the financial concerns of the Government.
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. Based on all of the reasons cited
above as to why the mitigating conditions apply, considered with Applicant’s military
history and the strong letters of recommendation, I find that the record evidence leaves
me with no significant questions or doubts as to Applicant’s eligibility and suitability for a
security clearance under the whole-person concept. For all these reasons, I conclude
Applicant has mitigated the 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: FOR APPLICANT
Subparagraphs 1.a through 1.h.: For Applicant
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Conclusion
In light of all of the circumstances presented by the record in this case, it is
clearly consistent with the national interest to grant Applicant eligibility for a security
clearance.  Eligibility for access to classified information is granted.
                                              
Martin H. Mogul
Administrative Judge