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DEPARTMENT OF DEFENSE 
DEFENSE OFFICE OF HEARINGS AND APPEALS 
           
             
 
 
In the matter of: ) 
 ) 
[Redacted] )  ISCR Case No. 11-08262 
 ) 
Applicant for Security Clearance ) 
 
 
Appearances 
 
For Government: Eric H. Borgstrom, Esq., Department Counsel 
For Applicant: Pro se 
 
 
______________ 
 
Decision 
______________ 
 
 
FOREMAN, LeRoy F., Administrative Judge: 
 
This case involves security concerns raised under Guideline F (Financial 
Considerations). Eligibility for access to classified information is denied. 
 
Statement of the Case 
 
Applicant submitted a security clearance application on March 21, 2011. On July 
6, 2012, the Defense Office of Hearings and Appeals (DOHA) notified him that it was 
unable to find that it was clearly consistent with the national interest to grant him access 
to classified information, and it recommended that his case be submitted to an 
administrative judge for a determination whether to grant or deny his application. DOHA 
set forth the basis for its action in a Statement of Reasons (SOR), citing security 
concerns under Guideline F. DOHA acted 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) implemented by the Department of Defense on September 1, 2006.  
 
 
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Applicant answered the SOR on July 23, 2012, and requested a hearing before 
an administrative judge. DOHA received the request on July 24, 2012. Department 
Counsel was ready to proceed on August 21, 2012, and the case was assigned to an 
administrative judge on August 23, 2012. It was reassigned to me on September 7, 
2012, because Applicant had moved out of the assigned administrative judge’s region. 
DOHA issued a notice of hearing on September 20, 2012, scheduling it for October 10, 
2012. I convened the hearing as scheduled. Government Exhibits (GX) 1 through 5 
were admitted in evidence without objection. Applicant testified but presented no 
documents or witnesses. I kept the record open until October 26, 2012, to enable him to 
present documentary evidence. DOHA received the transcript (Tr.) on October 24, 
2012. 
 
On November 7, 2012, Applicant requested an extension of the deadline for 
submitting documentary evidence, on the ground that he had evacuated from his home 
before the landfall of Hurricane Sandy, his home was currently flooded and without 
electricity, and his wife had given birth to their third child on November 6, 2012. I 
granted his request and extended the deadline until November 16, 2012. His request 
and my response are attached to the record as Hearing Exhibit (HX) I. On December 4, 
2012, he submitted 28 documents, marked as AX A through BB. Department Counsel 
did not object to the untimely submission or on any other grounds, and AX A through BB 
were admitted. The record closed on December 13, 2012. Applicant’s explanation for 
his untimely post-hearing submission is attached to the record as HX II, and Department 
Counsel’s comments are attached as HX III and HX IV. 
 
Amendment of SOR 
 
On Department Counsel’s motion, without objection by Applicant, I corrected 
Applicant’s name on the SOR by adding the suffix reflected on his security clearance 
application. (Tr. 13.) 
 
Findings of Fact 
 
In his answer to the SOR, Applicant admitted the allegations in SOR ¶¶ 1.b-1.e, 
1.g, and 1.i. He denied the allegations in SOR ¶¶ 1.a, 1.f, 1.h, and 1.j-1.m. His 
admissions in his answer and at the hearing are incorporated in my findings of fact.  
 
Applicant is a 46-year-old network administrator employed by a federal contractor 
since March 2011. He was given an interim clearance shortly after he was hired, but it 
was revoked in August 2012. (Tr. 31.) He was laid off when his interim clearance was 
revoked, but his employer is still sponsoring him for a clearance. He has been working 
temporarily on a project for another employer pending a decision on his security 
clearance. (Tr.28, 31.)  
 
Applicant graduated from high school in May 1985. He attended college from 
May 1985 to December 1987 and from July 1993 to January 1994, but did not receive a 
degree. He attended college from August 1994 to July 1996 and received a certificate in 
 
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network administration. He returned to college from January 2003 to May 2004, but he 
did not receive a degree. 
 
Applicant worked as a technical support specialist for a pharmaceutical company 
from October 2002 to March 2007 and as a UNIX systems engineer for a technology 
company from March 2007 to August 2008. He worked as a UNIX systems engineer for 
a telecommunications company from August 2008 to March 2011, when he began 
working for the federal contractor that is sponsoring him for a clearance. (GX 1 at 17-21; 
AX-J; AX-S.) 
 
Applicant married in January 1997. He and his wife bought a home in 2005. After 
Applicant started a new job in another location in 2007, his wife left him and returned to 
their previous home. (Tr. 21.) In July 2008, he began working in a foreign country and 
became involved with a woman who was a citizen and resident of that country. (GX 2 at 
5.) They had two children, now ages three and one, both born outside the United 
States. (AX L; AX V.) The childbirth costs were not covered by insurance, and Applicant 
paid about $27,700 in medical bills. (AX N and O.) After Applicant was transferred back 
to the United States, he traveled about once a month to visit and care for the woman 
and their children, incurring costs of about $350 per trip for round-trip air travel. His 
security clearance application reflects 20 trips ranging in duration from 2 to 30 days 
between November 2008 and October 2010. (GX 1 at 34-41.)  
 
In April 2008, Applicant traveled overseas with his mother for a six-day vacation. 
He used airline points to pay for his air travel, but incurred other expenses totaling about 
$1,200. (GX 2 at 151; Tr. 35.) 
 
In early 2009, while Applicant’s divorce was pending, his first wife filed criminal 
charges against him. His wife recanted her accusation in court, and the charges 
ultimately were dismissed as unfounded, but Applicant incurred substantial attorney’s 
fees to defend himself. He estimated that he paid about $10,000 in legal fees. (GX 2 at 
17-18; Tr. 24-25, 56.) 
 
Applicant divorced his first wife in June 2010 and married his second wife in July 
2010. (Tr. 23; AX-F; AX-Q.) He and his second wife now have a third child, born on 
November 6, 2012. His second wife recently immigrated to the United States and was 
granted permanent resident status. Applicant incurred significant legal fees to bring his 
second wife to the United States. (GX 2 at 3; Tr. 51.) 
 
Applicant has a 15-year-old daughter from his first marriage. (AX M.) He testified 
that he pays monthly child support of $1,428, which is automatically deducted from his 
pay. (Tr. 47.) Court records reflect monthly payments of $1,428 from August 2009 
through February 2010, payments totaling $2,405 in March 2010, payments of $1,428 
from April 2010 through June 2011, payments in various amounts between $500 and 
$714 in July through November 2011, no payments in December 2011, and monthly 
payments of $1,856 from January 2012 through July 2012. (AX B.) 
 
 
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As part of the divorce settlement, Applicant gave his first wife the family home, 
their automobile, and all assets that were acquired during the marriage. He paid off the 
mortgage on the house by using his retirement funds and investments. (GX 2 at 9, 13.) 
His ex-wife continued to use a credit card and a cell phone for which Applicant was 
financially responsible. (Tr. 41-42.)  
 
In June 2011, in response to DOHA interrogatories, Applicant provided a 
personal financial statement (PFS) reflecting that his net monthly remainder, after 
paying all his living expenses, was about $576. The PFS does not reflect any payments 
on the debts alleged in the SOR. (GX 2 at 20.)  
 
Applicant testified that he was earning about $87,000 while employed by a 
federal contractor. He is earning about $95,000 per year in his temporary job, but his 
employment will end when the project is completed. (Tr. 32-33.) 
 
Applicant filed a petition for Chapter 13 bankruptcy in February 2012. The 
petition was dismissed because Applicant had congestive heart failure in May 2012, and 
was unable to attend the creditors’ meeting. He had a defibrillator implanted in his 
chest, is being treated with medications, and his doctor believes he is doing well. (Tr. 
27; AX-U.)  
 
The SOR alleges 13 delinquent debts totaling about $56,276. Applicant denied 
ever having accounts with the creditors alleged in SOR ¶¶ 1.h, 1.j, and 1.m, and he 
believes that the debt alleged in SOR ¶ 1.l duplicates the debt in SOR ¶ 1.f, but he has 
not filed disputes with the creditors or the credit reporting agencies. (Tr. 43, 52-55.) In 
addition to the debts alleged in the SOR, he testified that he owes about $13,000 in 
federal income taxes for 2008 and 2009. (Tr. 59-61.) 
 
The debt alleged in SOR ¶ 1.j has been delinquent since 2006, the debt alleged 
in SOR ¶ 1.l has been delinquent since 2007, and the debt alleged in 1.m has been 
delinquent since 2008. The debts alleged in SOR ¶¶ 1.a-1.d and 1.g have been 
delinquent since 2009. The debt alleged in 1.i has been delinquent since 2010, and the 
debts alleged in SOR ¶¶ 1.e and 1.k have been delinquent since 2011. (GX 4; GX 5; Tr. 
36-43, 52-56.) 
 
At the hearing, Applicant testified that he had filed another Chapter 13 
bankruptcy petition in August 2012. (Tr. 18, 51-52.) The bankruptcy plan provides for 
payments totaling $46,500 at $775 per month. It lists a federal tax debt of $18,552, a 
secured debt of $16,038 for a four-year-old car, and no unsecured claims. As of the 
date the record closed, the bankruptcy plan had not been confirmed. (AX A.) 
 
After the hearing, Applicant submitted a credit report dated August 9, 2012. This 
credit report reflects that the debts alleged in SOR ¶¶ 1.a-1.i are still unresolved. It does 
not reflect the debts alleged in SOR ¶¶ 1.j-1.m, which Applicant denied in his answer to 
the SOR. (AX C.) He also submitted a financial analysis and debt management plan, 
which is undated and reflects only three debts to be managed. (AX E.) He estimates 
 
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that his monthly remainder after paying his living expenses and bankruptcy payment will 
be between $1,000 and $1,300. (Tr. 50.) 
 
Policies 
 
“[N]o one has a ‘right’ to a security clearance.” Department of the Navy v. Egan, 
484 U.S. 518, 528 (1988). As Commander in Chief, the President has the authority to 
“control access to information bearing on national security and to determine whether an 
individual is sufficiently trustworthy to have access to such information.” Id. at 527. The 
President has authorized the Secretary of Defense or his designee to grant applicants 
eligibility for access to classified information “only upon a finding that it is clearly 
consistent with the national interest to do so.” Exec. Or. 10865, Safeguarding Classified 
Information within Industry § 2 (Feb. 20, 1960), as amended.   
 
Eligibility for a security clearance is predicated upon the applicant meeting the 
criteria contained in the AG. These guidelines are not inflexible rules of law. Instead, 
recognizing the complexities of human behavior, an administrative judge applies these 
guidelines in conjunction with an evaluation of the whole person. An administrative 
judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. An 
administrative judge must consider all available, reliable information about the person, 
past and present, favorable and unfavorable. 
 
The Government reposes a high degree of trust and confidence in persons with 
access to classified information. This relationship transcends normal duty hours and 
endures throughout off-duty hours. Decisions include, by necessity, consideration of the 
possible risk that 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. 
 
Clearance decisions must be made “in terms of the national interest and shall in 
no sense be a determination as to the loyalty of the applicant concerned.”  See Exec. 
Or. 10865 § 7. Thus, a decision to deny a security clearance is merely an indication the 
applicant has not met the strict guidelines the President and the Secretary of Defense 
have established for issuing a clearance. 
 
Initially, the Government must establish, by substantial evidence, conditions in 
the personal or professional history of the applicant that may disqualify the applicant 
from being eligible for access to classified information. The Government has the burden 
of establishing controverted facts alleged in the SOR. See Egan, 484 U.S. at 531.  
“Substantial evidence” is “more than a scintilla but less than a preponderance.”  See v. 
Washington Metro. Area Transit Auth., 36 F.3d 375, 380 (4th Cir. 1994). The guidelines 
presume a nexus or rational connection between proven conduct under any of the 
criteria listed therein and an applicant’s security suitability. See ISCR Case No. 92-1106 
at 3, 1993 WL 545051 at *3 (App. Bd. Oct. 7, 1993).   
 
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Once the Government establishes a disqualifying condition by substantial 
evidence, the burden shifts to the applicant to rebut, explain, extenuate, or mitigate the 
facts. Directive ¶ E3.1.15. An applicant has the burden of proving a mitigating condition, 
and the burden of disproving it never shifts to the Government. See ISCR Case No. 02-
31154 at 5 (App. Bd. Sep. 22, 2005).  
 
An applicant “has the ultimate burden of demonstrating that it is clearly consistent 
with the national interest to grant or continue his security clearance.” ISCR Case No. 
01-20700 at 3 (App. Bd. Dec. 19, 2002). “[S]ecurity clearance determinations should err, 
if they must, on the side of denials.” Egan, 484 U.S. at 531; see AG ¶ 2(b).  
 
Analysis 
 
Guideline F, Financial Considerations 
 
The concern under this guideline 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. 
 
This concern is broader than the possibility that an applicant might knowingly 
compromise classified information in order to raise money. It encompasses concerns 
about an applicant’s self-control, judgment, and other qualities essential to protecting 
classified information. An individual who is financially irresponsible may also be 
irresponsible, unconcerned, or negligent in handling and safeguarding classified 
information. See ISCR Case No. 11-05365 at 3 (App. Bd. May 1, 2012). 
 
The following disqualifying conditions under this guideline are established by 
Applicant’s credit reports, his responses to DOHA interrogatories, and his admissions in 
his answer to the SOR and at the hearing; 
 
AG ¶ 19(a): inability or unwillingness to satisfy debts;  
 
AG ¶ 19(c): a history of not meeting financial obligations; and 
 
AG ¶ 19(e): consistent spending beyond one’s means, which may be 
indicated by excessive indebtedness, significant negative cash flow, high 
debt-to-income ratio, and/or other financial analysis. 
 
Security concerns based on financial considerations may be mitigated by any of 
the following conditions: 
 
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AG ¶ 20(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; 
 
AG ¶ 20(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; 
 
AG ¶ 20(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; 
 
AG ¶ 20(d): the individual initiated a good-faith effort to repay overdue 
creditors or otherwise resolve debts;   
 
AG ¶ 20(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; or 
 
AG ¶ 20(f): the affluence resulted from a legal source of income. 
 
AG ¶ 20(a) is not established. Applicant’s delinquent debts are numerous, recent, 
and not the product of circumstances making them unlikely to recur.  
 
AG ¶ 20(b) is not fully established. The breakup of Applicant’s first marriage and 
the legal expenses of defending against a frivolous criminal charge by his first wife were 
beyond his control. The expenses relating to the birth, care, and immigration of two 
children born as a result of an extramarital affair were not due to conditions beyond his 
control. In spite of his dire financial situation, he spent about $1,200 to take a vacation 
with his mother in April 2008. His congestive heart failure and related medical expenses 
were beyond his control, but they occurred long after most of the debts alleged in the 
SOR were already delinquent. He generously provided for his first wife, but he has 
neglected most of his delinquent debts for at least three years. 
 
AG ¶ 20(c) is not fully established. Applicant received financial counseling at 
some time, but the record does not reflect when or under what circumstances the 
counseling occurred, and his financial situation is not yet under control. 
 
AG ¶ 20(d) is not fully established. A Chapter 13 bankruptcy plan is a legal, 
orderly way to resolve delinquent debts, but Applicant’s bankruptcy has not yet been 
confirmed, and it is unclear what delinquent debts were included. Even if the bankruptcy 
includes all his delinquent debts, he has not yet established a track record of 
compliance with the payment plan. 
 
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AG ¶ 20(e) is not established. Applicant denied the debts alleged in SOR ¶ 1.i, 
1.l, and 1.m, but he has not documented the basis for denying them or provided 
documentary evidence that he has disputed them with the creditors or the credit 
reporting agencies. He testified that he believes the debt alleged in SOR ¶ 1.l duplicates 
SOR ¶ 1.f, but he presented no evidenced supporting his belief. 
 
AG ¶ 20(f) is not relevant. There is no evidence of unexplained affluence in this 
case. 
 
Whole-Person Concept 
 
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. In applying the whole-
person concept, an 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. An 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.  
 
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 has been in financial distress since 2006, and his response to his 
financial problems has been reactive rather than proactive. His recent Chapter 13 
bankruptcy filing is a step in the right direction, but his record of financial 
mismanagement does not inspire confidence that he will comply with the terms of his 
bankruptcy payment plan. His health problems and the losses he suffered from 
Hurricane Sandy were unfortunate and deserving of sympathy, but they occurred long 
after he was in serious financial trouble. 
 
After weighing the disqualifying and mitigating conditions under Guideline F, and 
evaluating all the evidence in the context of the whole person, I conclude Applicant has 
not mitigated the security concerns based on financial considerations. Accordingly, I 
conclude he has not carried his burden of showing that it is clearly consistent with the 
national interest to grant him eligibility for access to classified information. 
 
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Formal Findings 
 
I make the following formal findings on the allegations in the SOR: 
 
Paragraph 1, Guideline F (Financial Considerations): AGAINST APPLICANT 
 
 Subparagraphs 1.a-1.m:    Against Applicant 
 
Conclusion 
 
I conclude that 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. 
 
 
 
 
LeRoy F. Foreman 
Administrative Judge