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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)       ISCR Case No. 13-00740
)
Applicant for Security Clearance )
Appearances
For Government: Tovah A. Minster, Esquire, Department Counsel
For Applicant: Pro se  
______________
Decision
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HENRY, Mary E., Administrative Judge:
Based upon a review of the pleadings and exhibits, Applicant’s eligibility for
access to classified information is granted.
Statement of the Case
Applicant completed and certified an Electronic Questionnaire for Investigations
Processing (e-QIP) on December 20, 2012. The Department of Defense (DOD) issued
Applicant a Statement of Reasons (SOR) on July 19, 2013, 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. 
 
Item 1.1
Item 1; Item 5.2
Item 5; AE A.3
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Applicant received the SOR. He submitted a notarized, written response to the
SOR allegations dated August 2, 2013, and requested a decision on the written record
in lieu of a hearing. 
Department Counsel prepared a file of relevant material (FORM) and mailed
Applicant a complete copy on August 22, 2013. Applicant received the FORM on
September 3, 2013. He had 30 days from receipt of the FORM to file objections and
submit material in refutation, extenuation, or mitigation. He timely submitted a response.
DOHA assigned this case to me on October 10, 2013. The Government submitted nine
exhibits, which have been marked as Items 1-9 and admitted into the record. Applicant’s
response to the SOR has been marked and admitted as Item 3, and the SOR has been
marked as Item 1. His written response to the FORM is admitted into the record as
Applicant Exhibit A (AE A).
Findings of Fact
In his Answer to the SOR, Applicant admitted the factual allegations in ¶¶ 1.a -
1.m of the SOR. His admissions are incorporated herein as findings of fact. He also
provided additional information to support his request for eligibility for a security
clearance. After a complete and thorough review of the evidence of record, I make the
following findings of fact.  
Applicant, who is 38 years old, works as a quality assurance specialist for a DOD
contractor. He began his current employment in October 2012. From October 2009 until
October 2012, Applicant worked in quality assurance for other companies. He worked in
the painting industry from 2000 until October 2009, He operated his own painting
business from 2000 until 2008. He left the paint industry when work declined.1
Applicant graduated from high school. He and his wife married in June 2008, and
they separated in May 2012. Applicant filed for divorce because his wife spent all their
money and because she “poorly” treated his older children. He has a three-year-old
daughter from this marriage. He also have two daughters, ages 18 and 16, and 15-year-
old twins, a son and daughter, from a previous marriage.  2
Applicant earns $4,590 a month in gross income and he receives $2,532 in net
monthly income. From his gross income, child support of $607 and health insurance of
$299 a month are deducted. His June 2013 personal financial statement showed
monthly expenses of $550 for rent, $320 for food, $186 for utilities, $378 for gasoline
and car insurance, $30 for clothes, and $441 for a truck payment. His total monthly
expenses are $1,905. His net monthly remainder is $627.    3
Item 6; AE A.4
Item 3; Item 6; Item 9.5
Item 1; Item 3; Items 6-8.6
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Applicant filed a Chapter 13 bankruptcy petition on July 13, 2013. His listed gross
income is the same as shown on his earnings statement and personal financial
statement. He also showed the same payroll deductions including his child support and
health insurance and a net monthly income of $2,532. He identified the following
monthly expenses: $550 for rent, $185 for utilities, $400 for food, $50 for clothing, $40
for laundry and dry cleaning, $300 for transportation, $300 for medical, $106 for auto
insurance and tags, and $151 for school expenses for his children. His expenses totaled
$2,082, leaving a net remainder of $450. Since filing his bankruptcy petition, Applicant
has reduced his living expenses to help pay for his divorce and meet his bankruptcy
payments+. He now lives with an uncle who is not charging him rent, which saves $550
a month in rent plus some of his utility costs. In calculating his utility costs, he did not
identify the individual monthly cost for gas, oil, electric, water, and/or telephone.   4
The bankruptcy court directed Applicant to pay $450 a month for 60 months. The
court required him to make his initial $450 payment within 30 days of filing his petition.
He made his first $450 payment on August 22, 2013. The court scheduled a creditors
meeting for September 19, 2013 and set December 18, 2013 as the deadline for
creditors to file claims and January 26, 2014 for the government to file claims. Based on
these dates, Applicant’s bankruptcy plan will not be finalized until early 2014. Applicant
filed a Chapter 7 bankruptcy petition in February 2003, and the court discharged his
debts in June 2003.5
The SOR identifies 11 unpaid debts and one judgment totaling $30,167.
Applicant included the 11 unpaid debts in his bankruptcy petition. Although he said he
would resolve the judgment through bankruptcy, he did not include it in his bankruptcy
petition. The January 2013 and May 2013 credit reports reflect that Applicant’s last
payments on his SOR debts occurred between July 2008 and 2011. The credit reports
also show that Applicant pays his current bills, paid several unpaid debts, and has not
incurred additional unpaid debts. Applicant completed the credit counseling course
required by the bankruptcy court on July 19, 2013.6
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.
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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.
 
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
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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 since his marriage in 2008
because of his wife’s spending habits. Most of the debts 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;
and
(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.
With the economic decline in 2007 and 2008, Applicant’s paint business lost
customers and income. He closed the business in 2008 and sought full-time
employment in industry. He has worked steadily since 2008. He married in 2008. His
financial problems began shortly after his marriage when his wife would not cease
excessive spending. He is currently in the process of finalizing his divorce, an expense
beyond his control. He recently filed for Chapter 13 protection and reduced his monthly
living expenses to pay his debts. He completed the financial counseling requirement of
the bankruptcy court. These mitigating conditions are partially applicable. 
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):
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(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
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.
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The evidence in support of granting a security clearance to Applicant under the
whole-person concept is more substantial than the evidence in support of denial. In
reaching a conclusion, I considered the potentially disqualifying and mitigating
conditions in light of all the facts and circumstances surrounding this case. Applicant’s
2003 Chapter 7 bankruptcy petition indicates a history of financial problems. The credit
reports reflect that Applicant managed his bills and remained current on his bills until
2008, when he married. His recent financial problems began shortly after his 2008
marriage. (See AG & 2(a)(4).) His wife’s spending habits caused unpaid debts to
accumulate. The expense of his divorce proceedings interferes with his ability to repay
debts, which are due, in part, to circumstances largely beyond his control. (See AG &
2(a)(2).) The credit reports show that he has not accumulated additional unpaid debts
since 2011 and that his current bills are paid. He is using the bankruptcy wage earners
plan to repay his debts, and he has reduced his monthly living expenses to ensure
success. Most significantly, he has taken affirmative action to pay or resolve most of the
delinquent debts raising security concerns. (See AG & 2(a)(6).) 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. He has started his plan
payments as required by the court and before court approval of his plan. He has taken
responsibility for his debts. While his debts are not fully resolved, his plan indicates that
his debts are insufficient to raise security concerns.
Overall, the record evidence leaves me without questions or doubts as to
Applicant’s eligibility and suitability for a security clearance. For all these reasons, I
conclude Applicant mitigated the financial considerations 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: FOR APPLICANT
Subparagraphs1.a - 1.m: For Applicant
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.
                                                              
MARY E. HENRY
Administrative Judge
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