1
                                                             
                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)
[NAME REDACTED] )       ISCR Case No. 11-13984
)
)
Applicant for Security Clearance )
Appearances
For Government: Richard Stevens, Esquire, Department Counsel
For Applicant: Pro se
______________
Decision
______________
MALONE, Matthew E., Administrative Judge:
Applicant’s efforts to resolve his financial difficulties have not been undertaken in
good faith. His actions are insufficient to overcome the security concerns about his
financial decision making. Clearance is denied.
Statement of the Case
On June 13, 2011, Applicant submitted an Electronic Questionnaire for
Investigations Processing (e-QIP) to obtain a security clearance required for his
employment with a defense contractor. After reviewing the results of the ensuing
background investigation, Department of Defense (DOD) adjudicators were unable to
find that it is clearly consistent with the national interest to grant Applicant’s request for
 Required by Executive Order 10865, as amended, and by DoD Directive 5220.6 (Directive), as amended.1
 The adjudicative guidelines were implemented by the Department of Defense on September 1, 2006. These2
guidelines were published in the Federal Register and codified through 32 C.F.R. § 154, Appendix H (2006).
 As originally ordered at hearing, the record should have closed before receipt of the transcript. However, the3
federal government shutdown between October 1 and October 10 delayed completion of this record.
2
access to classified information.  On June 5, 2013, DOD issued to Applicant a1
Statement of Reasons (SOR) alleging facts which raise security concerns addressed in
the adjudicative guideline  for financial considerations (Guideline F).2
Applicant timely responded to the SOR (Answer) and requested a hearing. The
case was assigned to me on August 9, 2013, and I convened a hearing on September
19, 2013. Department Counsel presented Government Exhibits (Gx.) 1 - 3, which were
admitted without objection. (Tr. 19 - 25) Applicant testified and proffered six exhibits,
admitted without objection as Applicant’s Exhibit (Ax.) A - F. DOHA received the
transcript of hearing (Tr.) on September 30, 2013. I left the record open after the
hearing to receive additional relevant information from Applicant. His timely post-hearing
submissions have been admitted without objection as Ax. G. The record closed on
October 15, 2013.3
Findings of Fact
Under Guideline F, the Government alleged that Applicant owes $37,297 for nine
delinquent or past-due debts (SOR 1.a - 1.i). At hearing, Department Counsel withdrew
the allegation at SOR 1.h, thus reducing the total amount of debt at issue to $37,270.
Applicant admitted, in part, and denied, in part, the remaining Guideline F allegations.
(Tr. 11) In addition to his admissions, I make the following findings of fact. 
Applicant is 50 years old and works as a senior analyst for a defense contractor.
He has held that position since November 2011. Applicant has worked in the same
position with two other contractors at the same military facility since September 2008.
He has a bachelor’s degree in journalism, and earned a master’s degree in
management in 2012. His recent job performance evaluations reflect excellent work,
reliability, and professionalism. He currently earns about $100,000 annually. (Gx. 1; Gx.
2; Ax. G; Tr. 9, 59)
Applicant served on active duty in the United States Army from November 1986
until he retired in December 2006 with an honorable discharge as a major. In addition to
his income from his defense contractor job, Applicant receives about $40,000 annually
in retired pay, as well as another $12,000 annually in disability benefits. He served in
the Army Quartermasters Corps and deployed to Iraq in Operation Desert Storm. His
personal decorations include multiple awards of the Meritorious Service Medal, the
Army Commendation Medal, and the Army Achievement Medal. Applicant’s security
3
clearance, which he held throughout most of his Army career, was last renewed in
2005. (Gx. 1; Ax. G; Tr. 35, 54)
Applicant has been married three times. His first marriage began in May 1986
and ended by divorce in August 1994. He and his first wife had two children.
Unfortunately, one child died in 1987. The surviving child is now age 23. His second
marriage began in September 1994 and ended by divorce in February 2008. At the time
of the divorce, his second wife was an Army lieutenant colonel. His second marriage
produced three more children, now ages 16, 15, and 12. Applicant pays about $1,500
each month in child support. Applicant married his current wife in September 2010. In
addition to his own minor children, he also supports his third wife’s two children, ages
19 and 14. (Gx. 1; Gx. 2; Ax. G; Tr. 63)
When Applicant retired, he had not found civilian employment. While still on
active duty, he obtained a loan to pay for real estate investment classes he took
between August 2005 and March 2006. He eventually defaulted on that debt, which is
alleged at SOR 1.g. On September 5, 2013, he settled that debt for about $1,000 less
than the total obligation. (Ax. E; Tr. 47 - 48, 60 - 61) From his retirement in 2006 until he
was hired by a defense contractor for full-time work in September 2008, Applicant lived
off his retired pay and disability pay while trying, without success, to start a home-based
business. He also relied on credit cards to meet his expenses. A personal loan and a
credit card account that became delinquent during this period, alleged at SOR 1.b and
1.c, were the subject of two civil judgments entered against Applicant in July 2008.
Applicant paid those debts in March and April 2013. (Gx. 1 - 3; Ax. A; Ax. B; Ax. G; Tr.
44 - 47)
Other credit card accounts, alleged at SOR 1.a, 1.d, 1.e, and 1.i, also became
delinquent before 2008. As early as 2003 and 2004, Applicant had become delinquent
on previous credit card accounts with the creditor listed at SOR 1.e. Applicant’s debt
with the SOR 1.i creditor was resolved in his favor as part of a civil suit in which he was
one of many named plaintiffs. He paid the SOR 1.d account the day before his hearing
in this matter. The SOR 1.a account was paid six days after his hearing. The SOR 1.e
debt was forgiven by the creditor, but was attributed to Applicant as taxable income,
which created an unpaid federal tax debt in August 2013. Applicant paid that debt later
during the day of his hearing. (Gx. 1 - 3; Ax. A - G; Tr. 15, 31)
Applicant was interviewed for his clearance by a Government investigator on July
27, 2011. Most of that interview centered on delinquent debts contained in a credit
report obtained subsequent to Applicant’s June 2011 e-QIP. During the interview,
Applicant stated he would begin resolving the debts discussed, most of which have
been alleged in the SOR, by the end of 2011. (Gx. 2; Gx. 3)
Applicant testified that he did not immediately begin paying his past-due debts
when he started working in 2008 because he had other obligations. For example, he
was in the midst of his second divorce and had to pay legal fees as well as costs
associated with finding a new home. More significantly, Applicant became responsible
 See Directive. 6.3.4
4
for $1,500 each month in child support, as well as school tuition and related expenses.
Applicant also averred that he did not want to make incremental payments on his
delinquencies. Rather, his plan was to save enough money to pay the debts in full. His
credit score, he reasoned, would suffer more if he paid portions of the debts. However,
he also acknowledged that his credit score was already severely downgraded. (Ax. G;
Tr. 52 - 53)
Applicant vacationed outside the United States several times since 2004. He
made two such trips while he was unemployed between 2006 and 2008. He has
continued to take those trips since 2008, most recently in August 2013. On average, the
trips have cost around $2,000. (Gx. 1; Gx. 2; Tr. 49 - 51)
As to Applicant’s current finances, he has not incurred any new unpaid debts,
and his income is sufficient to meet all of his current obligations. As of March 2013,
Applicant has more than $1,800 remaining each month after expenses. However, when
he earned his master’s degree in 2012, he incurred about $21,000 in student loans that
were deferred until October 2013. He is also paying about $588 each month for two
timeshares owned by his current wife. (Gx. 2; Tr. 41 - 42) 
Policies
Each security clearance decision must be a fair, impartial, and commonsense
determination based on examination of all available relevant and material information,4
and consideration of the pertinent criteria and adjudication policy in the adjudicative
guidelines (AG). Decisions must also reflect consideration of the factors listed in ¶ 2(a)
of the new guidelines. Commonly referred to as the “whole-person” concept, those
factors are:
(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. 
The presence or absence of a disqualifying or mitigating condition is not
determinative of a conclusion for or against an applicant. However, specific applicable
guidelines should be followed whenever a case can be measured against them as they
represent policy guidance governing the grant or denial of access to classified
information.
 See Department of the Navy v. Egan, 484 U.S. 518 (1988).5
 See Egan, 484 U.S. at 528, 531.6
 See Egan; AG ¶ 2(b).7
5
A security clearance decision is intended only to resolve whether it is clearly
consistent with the national interest  for an applicant to either receive or continue to5
have access to classified information. The Government bears the initial burden of
producing admissible information on which it based the preliminary decision to deny or
revoke a security clearance for an applicant. Additionally, the Government must be able
to prove controverted facts alleged in the SOR. If the government meets its burden, it
then falls to the applicant to refute, extenuate or mitigate the Government’s case.
Because no one has a “right” to a security clearance, an applicant bears a heavy
burden of persuasion.  6
A person who has access to classified information enters into a fiduciary
relationship with the Government based on trust and confidence. Thus, the Government
has a compelling interest in ensuring each applicant possesses the requisite judgment,
reliability and trustworthiness of one who will protect the national interests as his or her
own. The “clearly consistent with the national interest” standard compels resolution of
any reasonable doubt about an applicant’s suitability for access in favor of the
Government.7
Analysis
Financial Considerations
The Government established that Applicant accrued the delinquent debts alleged
in the SOR. Those debts remained unpaid for several years, even after he was asked
about his financial problems more than two years ago during his background
investigation. Available information raises a security concern, expressed, in relevant
part, at AG ¶ 18 as follows:
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. 
More specifically, available information requires application of the disqualifying
conditions at AG ¶ 19(a) (inability or unwillingness to satisfy debts) and AG ¶ 19(c) (a
history of not meeting financial obligations). Applicant was able to start repaying his
debts after 2008. Before his second marriage ended in 2008, his retired pay and
6
disability benefits, combined with his second wife’s income as an active duty Army
officer, should have been enough for him to start resolving his debts. 
By contrast, I have considered the following pertinent AG ¶ 20 mitigating
conditions:
(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;
(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;
(d) the individual initiated a good-faith effort to repay overdue creditors or
otherwise resolve debts; and
(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.
The mitigating condition at AG ¶ 20(e) applies to the debt at SOR 1.i, which was
invalidated through a civil suit. As to all of the SOR allegations, I conclude no other
mitigating conditions apply. Applicant established that he has paid or otherwise resolved
all of the debts alleged in the SOR, that he has incurred no new delinquencies, and that
his income meets his current financial obligations. Nonetheless, Applicant’s financial
problems are recent, because it was not until just before or just after his hearing that he
paid off his debts. They are not isolated because there are numerous debts alleged and,
although the SOR debts became delinquent after Applicant retired, he also incurred
delinquencies while he was on active duty. 
Applicant also points to his two years of unemployment after the Army as the
reason for his delinquencies. However, his lack of steady employment was his own
choice, as he tried for two years to start a business and used personal credit to make
ends meet. His use of personal credit also extended to expensive vacations taken while
unemployed and falling behind on his financial obligations. 
These facts show that Applicant is not likely to commit improper or illegal acts to
generate funds with which to pay his debts. However, also of concern is the
questionable judgment and trustworthiness that arises when a person neglects his
financial obligations. Such conduct may indicate that Applicant may not tend to the
fiduciary responsibilities that come with holding a security clearance. Applicant claimed
that he was saving to pay his debts in full as opposed to acting earlier to make
7
incremental payments on some of his debts. However, this claim is undermined by his
continued spending on vacations while he was unemployed and after he returned to the
workforce in 2008. It is clear from all information about Applicant’s intentions regarding
his debt resolution that he only acted in a substantive way after he received the SOR.
All of the foregoing precludes sufficient application of the mitigating conditions to
resolve the security concerns about Applicant’s finances. The allegations under
Guideline F are resolved against the Applicant. 
Whole-Person Concept
I have evaluated the facts and have applied the appropriate adjudicative factors
under Guideline F. I also have reviewed the record before me in the context of the
whole-person factors listed in AG ¶ 2(a). Applicant is 50 years old and presumed to be a
mature, responsible adult. He is a decorated retired military officer and, since 2008, has
established a record of excellent performance as a defense contractor. However, his
failure to more timely resolve his financial problems reasonably raised a security
concern about his suitability for continued access to classified information. Doubts
remain about his judgment given his inaction since 2008 to address his debts.  Because
protection of the national interest is the primary concern in these matters, those doubts
must be resolved against the Applicant.
Formal Findings
Formal findings 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
Subparagraphs 1.a - 1.g, 1.i: Against Applicant
Subparagraph 1.h: Withdrawn
Conclusion
In light of all of the foregoing, it is not clearly consistent with the national interest
for Applicant to have access to classified information. Applicant’s request for a security
clearance is denied.
MATTHEW E. MALONE
Administrative Judge