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    DEPARTMENT OF DEFENSE 
            DEFENSE OFFICE OF HEARINGS AND APPEALS 
          
             
 
 
 
In the matter of: ) 
) 
XXXXXXXXXXXXXX )       ISCR Case No. 11-04949 
 ) 
) 
Applicant for Security Clearance ) 
 
 
Appearances 
 
For Government: Gina L. Marine, Esquire, Department Counsel 
For Applicant: Pro se 
 
 
 
______________ 
 
Decision 
______________ 
 
 
HOWE, Philip S., Administrative Judge: 
 
On December 1, 2009, Applicant submitted his electronic version of the Security 
Clearance Application (SF 86) (e-QIP). On May 9, 2012, the Defense Office of Hearings 
and Appeals (DOHA) issued to Applicant a Statement of Reasons (SOR) detailing 
security concerns under Guideline F. 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 on September 
1, 2006.  
 
Applicant answered the SOR in writing on June 4, 2012 (Answer). Applicant 
requested his case be decided on the written record in lieu of a hearing.  
 
On August 7, 2012, Department Counsel submitted the Department s written 
case. A complete copy of the file of relevant material (FORM) was provided to the 
Applicant on August 10, 2012. He was given the opportunity to file objections and 
submit material in refutation, extenuation, or mitigation. Applicant received the file on 
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August 27, 2012. Applicant filed a Response to the FORM within the 30 day time 
allowed that would have expired on September 26, 2012. I received the case 
assignment on October 12, 2012. Based upon a review of the complete case file, 
pleadings, and exhibits, eligibility for access to classified information is denied 
 
Findings of Fact 
 
Applicant admitted all allegations in the SOR. He submitted an explanation of his 
delinquent debt history as part of his Answer. Applicant is divorced and has one adult 
son. He is 50 years old and works for a defense contractor. (Items 2-5)  
 
The SOR lists eight delinquent debts totaling $281,078. These debts include first 
and second mortgages in the amount of $245,000 on his former residence 
(Subparagraph 1.a). He did not pay them and the house was foreclosed upon in 2008. 
(Items 2-11)  
 
The SOR listed a Chapter 13 bankruptcy filed on May 18, 2010 (Subparagraph 
1.b). The SOR states Applicant withdrew the petition in February, 2010, but the FORM 
states it was dismissed on September 26, 2011, citing Items 6 through 8 of the FORM, 
including Item 7, the Chapter 13 Trustee’s Final Report and Account which shows the 
September 26th date. None of his debts have been resolved. While his Chapter 13 
bankruptcy was pending, Applicant withdrew $18,000 from his 401(k) account to use as 
a down payment on another house after he ceased cohabitating with his girlfriend. His 
attorney advised him the additional debt could affect adversely his bankruptcy petition 
because the petition claimed he could not pay his present debts, yet he incurred 
additional debt for the new house. That withdrawal resulted in a federal income tax 
liability of about $12,000. He also owed $900 to his state tax department. He claims he 
contacted both governments’ tax offices and was told he did not owe anything to the 
Internal Revenue Service (IRS) and the state tax return was “pending.” The tax issues 
were not listed in the SOR but disclosed in Applicant’s Answer and interrogatory 
responses. (Items 2-11) 
 
Applicant has $36,078 in six unresolved credit card debts (Subparagraphs 1.c to 
1.h). He became responsible for these debts after his divorce in 1997 that he initiated. 
He used the second mortgage on his former home to pay other credit card debts. The 
debts listed in the SOR are also additional credit debts he incurred in 2008 and 2009 
after his divorce. (Items 2-4, 9-11) 
  
Applicant did not pay his mortgages on his first home because he used the 
monthly payment amounts to help his girlfriend pay her mortgage and to pay moving 
expenses of himself and his collection of exotic animals into the girlfriend’s house. 
(Items 2-11) 
 
Applicant has a net monthly remainder from his income of $1,066. He received a 
salary increase of up to $2,000 annually in 2012. His gross salary according to his 
personal financial statement is $4,598 monthly, resulting in a $55,176 annual income. 
(Item 5)  
 
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Applicant explains his financial difficulties were caused by his credit card debt 
after his divorce, a student loan for about $20,000 for his son’s college education, a 
long-term medical problem for which he used alternative treatments (acupuncture, 
hypnosis, and Botox injections in his back) that were not covered by Applicant’s medical 
insurance, and for which he had to pay directly. He attributes his failure to sell his first 
home to the housing market conditions in 2009 and later. (Item 5)  
 
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 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, the administrative judge applies 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.  
 
According to Directive ¶ E3.1.14, the Government must present evidence to 
establish controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, an 
“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.”  
 
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. See also EO 12968, Section 3.1(b) (listing multiple prerequisites 
for access to classified or sensitive information).  
 
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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 at AG & 19 contains nine disqualifying conditions that could raise 
security concerns. From these nine conditions, two conditions are applicable to the facts 
found in this case: 
 
(a) inability or unwillingness to satisfy debts; and   
 
(c) a history of not meeting financial obligations. 
 
 From 2008 to the present, Applicant accumulated eight delinquent debts, 
including two mortgages on his former residence and six credit card balances, totaling 
$281,078 that remain unpaid or unresolved. Applicant filed a Chapter 13 bankruptcy 
petition in 2010 and withdrew it in 2011. 
 
The guideline in AG ¶ 20 contains six conditions that could mitigate security 
concerns arising from financial difficulties. No mitigating condition applies. 
 
AG ¶ 20 (a) does not apply because Applicant’s debts are ongoing and unpaid.  
 
AG ¶ 20 (b) does not apply because Applicant’s financial problems were the 
result of his decisions to spend more money than he could repay on his salary. He failed 
to meet his burden of proof on that issue. 
 
Applicant did not present any evidence of financial counseling or show his 
financial delinquencies are under control. AG ¶ 20 (c) does not apply.  
Applicant did not submit any evidence to show he made any good faith efforts in 
the past four years to repay his delinquent debts. AG ¶ 20 (d) does not apply.  
 
Applicant did not demonstrate any legitimate basis for disputing any debt. He did 
not offer any documents to show he disputed any debt. AG ¶ 20 (e) does not apply. 
 
The final mitigating condition is affluence resulting from a legal source of income. 
There is no evidence showing this condition is relevant here.  
 
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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 
facts and circumstances surrounding this case. Applicant was an adult when he 
incurred the debts. He has not taken any action to resolve his delinquent debts. This 
inaction leaves him vulnerable to pressure, coercion, exploitation, or duress based on 
the magnitude of his financial obligation. His lack of action continues to this day, and is 
obviously voluntary. His inaction will continue based on his past performance. Applicant 
displayed a lack of good judgment incurring the debts.  Next, he exhibited a continued 
lack of appropriate judgment by failing to make payments on any of his delinquent debts 
during the past four years. 
 
Overall, the record evidence leaves me with questions and substantial doubts as 
to Applicant’s eligibility and suitability for a security clearance. For all these reasons, I 
conclude Applicant did not mitigate the security concerns arising under the guideline for 
Financial Considerations. I conclude the whole-person concept against Applicant.  
 
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 
 
          Subparagraph 1.a to 1.h:   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 Applicant eligibility for a security 
clearance. Eligibility for access to classified information is denied. 
 
 
 
 
                                                   
_________________ 
PHILIP S. HOWE 
Administrative Judge