1
 
                                                             
                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)       ISCR Case No. 11-08403
)
Applicant for Security Clearance )
Appearances
For Government: Ray T. Blank Jr., Esquire, Department Counsel
For Applicant: Pro se  
______________
Decision
______________
HENRY, Mary E., Administrative Judge:
Based upon a review of the pleadings, exhibits, and testimony, Applicant’s
eligibility for access to classified information is denied.
Statement of the Case
Applicant completed and certified an Electronic Questionnaire for Investigations
Processing (e-QIP) on September 14, 2010. The Department of Defense (DOD) issued
Applicant a Statement of Reasons (SOR) on July 9, 2012, detailing security concerns
under Guideline F, financial considerations. The action was taken under Executive
Order 10865, Safeguarding Classified Information within Industry (February 20, 1960),
as amended; DOD Directive 5220.6, Defense Industrial Personnel Security Clearance
Review Program (January 2, 1992), as amended (Directive); and the Adjudicative
Guidelines For Determining Eligibility for Access to Classified Information (AG)
implemented on September 1, 2006. 
 
Tr. 60 -71.1
2
Applicant received the SOR on July 25, 2012, and he answered it on August 13,
2012. Applicant requested a hearing before an administrative judge with the Defense
Office of Hearings and Appeals (DOHA). DOHA received the request, and Department
Counsel was prepared to proceed on October 4, 2012. I received the case assignment
on October 15, 2012. DOHA issued a Notice of Hearing on October 31, 2012, and I
convened the hearing as scheduled on November 14, 2012. The Government offered
exhibits (GE) marked as GE 1 through GE 5, which were received and admitted into
evidence without objection. Applicant and two witnesses testified. He did not submit any
exhibits. DOHA received the hearing transcript (Tr.) on November 26, 2012. I held the
record open until December 5, 2012, for Applicant to submit additional matters. On
December 4, 2012, he requested additional time to submit his documentation. The
Government did not object. I granted Applicant’s request, giving him until December 26,
2012, to submit additional evidence. Applicant did not submit any additional evidence.
The record closed on December 26, 2012.
Procedural Ruling
Notice
Applicant received the hearing notice less than 15 days before the hearing. I
advised Applicant of his right under ¶ E3.1.8 of the Directive to receive the notice 15
days before the hearing. Applicant affirmatively waived his right to the 15-day notice.
(Tr. 8.)
Findings of Fact
In his Answer to the SOR, Applicant admitted all the factual allegations in the
SOR. His admissions are incorporated herein as findings of fact. He also indicated that
the debts in ¶¶ 1.b and 1.c of the SOR had been paid. After a complete and thorough
review of the evidence of record, I make the following additional findings of fact.  
Applicant, who is 31 years old, works as a mechanic for a Department of
Defense contractor. He began his current employment in January 2009. His immediate
and second level supervisors testified on his behalf. Both describe him as an
outstanding employee with the most knowledge about their work. They consider him
reliable, honest, dependable, and trustworthy. Both are aware that he has financial
problems, but do not believe that his financial problems will impact his ability to manage
classified information.1
Applicant graduated from high school. He served in the U.S. Air Force from
October 2000 until January 2008. He received a Good Conduct Medal, an Air Force
Commendation Medal, an Air Force Achievement Medal with two oak leaf clusters, a
Meritorious Unit Award, Air Force Outstanding Unit Award with Valor Device with two
GE 2; Tr. 17.2
GE 2; Tr. 17-20.3
GE 4; Tr. 21-24.4
Tr. 46-48.5
GE 2; Tr. 20-21, 38.6
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oak leaf clusters, a National Defense Service Medal, a Global War on Terrorism
Expeditionary Medal, and numerous other medals and ribbons.2
Applicant married his first wife in 2004; they separated three months later; and
they divorced in March 2006. Applicant and his wife married in April 2007. They have
twin sons, who are seven years old, and her 11-year-old daughter lives with them. His
wife does not work. Applicant recently started college. He received extensive training
while in the Air Force.  3
In 2007, Applicant purchased a house. Prior to moving to his new home, his
landlord did a pre-inspection of the apartment for damage and found none. Later, the
landlord changed his mind and decided $296 in damages existed, which is the debt in
SOR allegation 1.a. Applicant never received a bill from his landlord, although he left a
forwarding address. Applicant left the Air Force in January 2008, after accepting a
position with a start-up company. This position paid $17.50 an hour and required him to
move. Applicant decided to rent his house. He rented it for two months to a friend. He
left the utilities in his name, anticipating that the bills would be paid by his friend, but the
bills may not have been paid. His mortgage was $680 a month. His rent in the new
location was $1,500. His wages were insufficient to allow him to pay his rent, mortgage,
and other necessary living expenses such as food, utilities, and gasoline. Eventually,
the mortgage company foreclosed on his property. He does not owe any money to the
mortgage company.4
Applicant and his family lived with his parents for six months in 2008 because of
his finances. Applicant accepted a job offer in another city with his current employer at a
significantly higher salary. He relocated his family in January 2009 to their present
residence, which has lower rent.5
Applicant attributes his current financial problems to his first marriage, the cost of
moving a family of five twice in a year, and insufficient income from his job with a start-
up company. Unknown to him, his first wife purchased furniture with a loan in his name.
She worked and agreed to pay the monthly loan payment. When they separated, she
took the furniture and eventually stopped the payments on the furniture. He believes he
left a forwarding address on his utilities, cable, and other bills when he moved. He did
not receive bills after he moved in 2008 and 2009.6
GE 2; Tr. 31-33.7
GE 3 - GE 5; Tr. 31-32.8
GE 2; Tr. 25-31.9
4
His wife’s purse was stolen in 2007. She had her identification and his checkbook
in her purse. The thief wrote several checks, which were not honored (SOR ¶¶ 1.b and
1.r). Applicant cliams to have resolved these debts, but has not verified his payments.
He asserts he paid the $24 debt in SOR ¶ 1.c. and the debt in SOR ¶ 1.q, but he has
not verified his payments. Applicant has not resolved any of the other debts.  7
Three credit reports, dated September 17, 2010, February 5, 2011, and May 15,
2012 reflect that Applicant disputed the debts in SOR ¶¶ 1.j ($920), 1.m ($6,974), and
1.o ($463). Applicant again disputed the debt in SOR allegation 1.j ($920) after a
resolution of his first dispute. The February 5, 2011 credit report indicates these
accounts are closed. The May 15, 2012 credit report shows that Applicant disputed the
debt in SOR allegation 1.b ($69), which is a debt he stated he paid. The resolution of his
disputes is unknown.8
 Applicant has not participated in a financial counseling program. In 2010,
Applicant met with an attorney to discuss filing bankruptcy. At the initial meeting, the
attorney advised Applicant that he could file a Chapter 7 petition for bankruptcy.
Applicant met with the attorney a second time. After a further review of his income, the
attorney advised Applicant that he needed to file a Chapter 13 bankruptcy petition, not a
Chapter 7 bankruptcy petition. Applicant retained the services of this attorney on May
31, 2012. He has paid $85 to the attorney. As of the hearing, the Chapter 13 petition
had not been filed because Applicant had to request a new copy of his social security
card, which he did in October 2012. Before he could make this request, he needed a
copy of his birth certificate, which he requested in August 2012. As soon as he receives
his social security card, he plans on filing his Chapter 13 bankruptcy petition, which will
include all the unpaid debts listed in the SOR. He anticipates a Chapter 13 monthly
payment of approximately $660. He also believes all his debts will be resolved through
his bankruptcy.  9
Applicant currently earns $4,736 in monthly gross income, plus overtime of
varying amounts. His June 2012 leave and earnings statement indicated he worked 42
hours of overtime that pay period, which increased his gross income for that pay period
by $1,865. Overtime work varies each week. His one biweekly net income in June 2012
was $3,155. Because Applicant has not provided any other information about his
income, I am unable to accurately determine his net monthly income and expenses. At
the hearing, he indicated that he paid $1,150 a month in rent and he had a vehicle
payment of $680 a month. Applicant completed a personal financial statement in June
2012, which showed monthly expenses of $2,200 for rent, food, utilities, clothing, and
car expense. His vehicle payment or car insurance is not part of this statement. For a
family of five, he estimated food costs at $300, which seems low. The financial
GE 2; Tr. 22-23, 32-33, 48.10
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statement does not contain a full itemization of his monthly household expenses. The
record lacks complete information about his monthly income and expenses. As of the
close of the record, Applicant had not provided documentation indicating that he filed his
bankruptcy petition. 10
Policies
When evaluating an applicant’s suitability for a security clearance, the
administrative judge must consider the adjudicative guidelines. In addition to brief
introductory explanations for each guideline, the adjudicative guidelines list potentially
disqualifying conditions and mitigating conditions, which are 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, 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. 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.
Under 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 applicant or proven by Department Counsel. . . .” An
applicant has the ultimate burden of persuasion for obtaining 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 an 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.
6
 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. 
AG ¶ 19 describes the disqualifying conditions that could raise security concerns.
I have considered all the conditions, and the following are potentially applicable: 
(a) inability or unwillingness to satisfy debts; and
(c) a history of not meeting financial obligations. 
Applicant developed significant financial problems after he separated from the Air
Force, accepted a position with insufficient income, then moved his family twice in one
year. Most of the debts in the SOR have not been resolved. These two disqualifying
conditions apply.
The Financial Considerations guideline also includes examples of conditions that
can mitigate security concerns. I have considered mitigating factors AG ¶ 20(a) through
¶ 20(f), and the following are potentially applicable:
(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
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(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.
Applicant’s debts arose after his discharge from the Air Force and acceptance of
a job in another city. He incurred moving expenses, which he later realized he could not
afford. His $17.50 an hour salary was insufficient to allow him to meet all his monthly
expenses. He rented his home when he moved, but the tenant remained only a short
time. Applicant could not afford the payments on his house and his rent in his new
locale. His wife’s purse was stolen and the thief used Applicant’s checkbook to write bad
checks. He also incurred some debt from his divorce from his first wife. Applicant
asserts he paid three small debts, but he has not provided proof. Circumstances beyond
his control caused his financial problems. AG ¶ 20(b) is partially applicable because
Applicant has not provided evidence that he has acted reasonably to resolve his
undisputed debts.
Applicant has not received financial counseling nor is there clear evidence that
his debts are under control. He pays his current expenses, which are under control. His
past debts remain unresolved. He has not established a good-faith effort to contact his
creditors and pay his debts. AG ¶¶ 20(c) and 20(d) are not applicable. 
Applicant disputed four debts listed in the SOR because he does not owe the
debts. His credit reports reflects his disputes of these debts. AG ¶ 20(e) applies to SOR
allegations 1.b, 1.j, 1.m, and 1.o.
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 an 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. The decision to grant or
deny a security clearance requires a careful weighing of all relevant factors, both
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favorable and unfavorable. In so doing, an administrative judge must review all the
evidence of record, not a single item in isolation, to determine if a security concern is
established and then whether it is mitigated. A determination of an applicant’s eligibility
for a security clearance should not be made as punishment for specific past conduct,
but on a reasonable and careful evaluation of all the evidence of record to decide if a
nexus exists between established facts and a legitimate security concern. 
In assessing whether an Applicant has established mitigation under Guideline F,
the Appeal Board provided the following guidance in ISCR Case No. 07-06482 at 3
(App. Bd. May 21, 2008):
In evaluating Guideline F cases, the Board has previously noted that the
concept of “‘meaningful track record’ necessarily includes evidence of
actual debt reduction through payment of debts.” See, e.g., ISCR Case
No. 05-01920 at 5 (App. Bd. Mar. 1, 2007). However, an applicant is not
required, as a matter of law, to establish that he has paid off each and
every debt listed in the SOR. See, e.g., ISCR Case No. 02-25499 at 2
(App. Bd. Jun. 5, 2006). All that is required is that an applicant
demonstrate that he has “. . . established a plan to resolve his financial
problems and taken significant actions to implement that plan.” See, e.g.,
ISCR Case No. 04-09684 at 2 (App. Bd. Jul. 6, 2006). The Judge can
reasonably consider the entirety of an applicant’s financial situation and
his actions in evaluating the extent to which that applicant’s plan for the
reduction of his outstanding indebtedness is credible and realistic. See
Directive ¶ E2.2(a) (“Available, reliable information about the person, past
and present, favorable and unfavorable, should be considered in reaching
a determination.”) There is no requirement that a plan provide for
payments on all outstanding debts simultaneously. Rather, a reasonable
plan (and concomitant conduct) may provide for the payment of such
debts one at a time. See, e.g., ISCR Case No. 06-25584 at 4 (App. Bd.
Apr. 4, 2008). Likewise, there is no requirement that the first debts actually
paid in furtherance of a reasonable debt plan be the ones listed in the
SOR.
In reaching a conclusion, I considered the potentially disqualifying and mitigating
conditions in light of all the facts and circumstances surrounding this case. Applicant
successfully performed his duties while in the Air Force, and he received numerous
awards during his military service. He is highly respected by his supervisors for his skills
and work ethic. Both consider him hard working, honest, reliable, and trustworthy. They
do not believe his financial problems would impact his working with classified
information. He accumulated debt due to circumstances largely beyond his control,
including divorce, underemployment, and moving. When his finances were low, he and
his family lived with his parents to reduce his monthly expenses. (See AG & 2(a)(2).) He
pays his current living expenses and lives within his monthly income. He disputed
several debts, one which he believes he paid.
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However, Applicant has not established a track record for paying his debts nor
has he developed a plan of action for his debts. He plans on filing for Chapter 13
bankruptcy and estimates his monthly payment to be approximately $660, but he has
not provided proof that he has filed bankruptcy. In weighing all the evidence of record, I
find that Applicant has not provided sufficient evidence to establish that his debts are
under control. He needs additional time to show that he has filed for bankruptcy and is
in compliance with his bankruptcy payment plan. Of course, the issue is not simply
whether all his debts are paid: it is whether his financial circumstances raise concerns
about his fitness to hold a security clearance. Given the amount of unresolved debts,
Applicant’s debts remain a security concern.
Overall, the record evidence leaves me with questions or doubts as to Applicant’s
eligibility and suitability for a security clearance. For all these reasons, I conclude
Applicant has not mitigated the security concerns arising from his finances under
Guideline F.
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: Against Applicant
Subparagraph 1.b: For Applicant
Subparagraphs 1.c-i: Against Applicant
Subparagraph 1.j: For Applicant
Subparagraph 1.k: Against Applicant
Subparagraph 1.l: Against Applicant
Subparagraph 1.m: For Applicant
Subparagraph 1.n: Against Applicant
Subparagraph 1.o: For Applicant
Subparagraphs 1.p-1.w: Against Applicant
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.
                                                              
MARY E. HENRY
Administrative Judge