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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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)
[NAME REDACTED] )       ISCR Case No. 11-03936
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Applicant for Security Clearance )
Appearances
For Government: Chris Morin, Esquire, Department Counsel
For Applicant: Pro se
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Decision
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MALONE, Matthew E., Administrative Judge:
Applicant mitigated the security concerns raised by multiple past-due debts. His
personal financial management and his recent actions to resolve his debts show he is
not likely to incur new debts or other financial problems in the future. His request for a
security clearance is granted.
Statement of the Case
On June 23, 2011, Applicant submitted an Electronic Questionnaire for
Investigations Processing (EQIP) to obtain or renew eligibility for a security clearance
required for his work as a defense contractor. Based on the results of the ensuing
background investigation, which included Applicant’s responses to interrogatories from
  Authorized by DOD Directive 5220.6 (Directive), Section E3.1.2.2.1
  Required by Executive Order 10865, as amended, and by DOD Directive 5220.6 (Directive), as amended.2
 The adjudicative guidelines were implemented by the Department of Defense on September 1, 2006. These3
guidelines were published in the Federal Register and codified through 32 C.F.R. § 154, Appendix H (2006).
  See Directive, Enclosure 3, Section E3.1.7. 4
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Department of Defense (DOD) adjudicators,  it could not be determined that it was1
clearly consistent with the national interest for Applicant to continue to hold a security
clearance.2
On July 25, 2013, DOD adjudicators issued to Applicant a Statement of Reasons
(SOR) alleging facts which raise security concerns addressed under the adjudicative
guideline  for financial considerations (Guideline F). On July 31, 2013, Applicant3
responded to the SOR (Answer) and requested a decision without a hearing.
Department Counsel for the Defense Office of Hearings and Appeals (DOHA)
subsequently issued a File of Relevant Material (FORM) in support of the SOR.  On4
February 17, 2014, Applicant responded, through an attorney, to the FORM. In his
response, he amended his Answer and provided additional information. He also
requested a hearing, and DOHA agreed to convert his case for hearing.
The case was assigned to me on March 21, 2014, and I convened a hearing on
April 2, 2014. Department Counsel presented Government Exhibits (Gx.) 1 - 10, which
were admitted without objection. Applicant, appearing pro se, testified and presented
Applicant’s Exhibits (Ax.) A and B, which were admitted without objection. Five
witnesses also testified on Applicant’s behalf.
Additionally, Department Counsel waived objection to the admission of
Applicant’s response to the FORM. It is admitted as Hx. 3 and contains Attachments A,
B, C, D1 - D6, and E. DOHA received the transcript of hearing (Tr.) on April 17, 2014.
Findings of Fact
Under Guideline F, the Government alleged that Applicant owed $72,972 through
20 past-due or delinquent debts (SOR 1.a - 1.t). Applicant denied, with explanations, the
allegations at SOR 1.b, 1.k, and 1.r. He admitted, with explanations, the remaining SOR
allegations. (Answer; Hx. 3) In addition to the facts established by his admissions, I
make the following findings of fact.
Applicant is 37 years old. He maintains and installs telephone and computer
cable systems as a defense contractor employee at a U.S. military installation. He has
worked in that capacity since June 2008, albeit, for three different companies. He has
worked for his current employer since March 2009, and has a reputation for honesty
and professionalism in the workplace. His supervisor and the Government’s technical
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representative each testified that Applicant is an excellent worker on whom they rely
heavily. Both witnesses were aware of the Government’s concerns about Applicant’s
finances. (Gx. 1; Tr. 81 - 90)
Applicant has been married twice. His first marriage began in January 1996 and
produced one child, now age 16, who lives with Applicant. His first wife left him and their
child in September 1998, and Applicant has not seen her since. He was unable to
obtain a divorce until January 2013, just before Applicant and his current wife were
married. They have a blended family of eight. Applicant has three children (one from his
first marriage, one from before his current marriage, and one with his second wife). His
wife has three children from before their marriage. All of their children are minors living
in Applicant’s marital residence. (Gx. 1; Tr. 73 - 74)
Applicant served in the U.S. Army from October 1995 until October 1998. He was
administratively separated in lieu of a court martial after being away without leave
(AWOL) on two occasions for a total of 71 days. Applicant testified that he felt he had to
stay home to take care of his then-infant child after his first wife abandoned them. (Gx.
1; Gx. 2; Tr. 45 - 48)
Since about March 2000, Applicant has been steadily employed, first as a traffic
signal technician, then as an electrician’s assistant. In the latter work, he had no health
insurance from about August 2007 until June 2008, when he began work as a defense
contractor. In May 2008, Applicant lost his job due to the economic downturn and was
unemployed for four months. To get medical treatment, he often went to hospital
emergency rooms. The debts alleged at SOR 1.b - 1.l, 1.o and 1.q are unpaid bills
totaling about $15,900 for many of those emergency room visits. Applicant and his wife
have tried to work with the collection agencies holding those accounts, but have been
unable to afford the payment terms demanded of them. (Gx. 1; Gx. 2; Tr. 60 - 62)
In 2009, Applicant was hurt in a motorcycle accident. Medical insurance covered
the costs of treatment, but he was unable to work and could not make his rent payments
on time. He broke his lease early and, as alleged in SOR 1.a, still owes about $6,300
through a civil judgment filed against him in January 2012. (Gx. 5; Tr. 58 - 59)
In December 2007, Applicant financed the purchase of a used car through
Wachovia Bank. His mother co-signed the loan, and Applicant paid the loan as required
until sometime in 2009. After Wells Fargo acquired Wachovia, a clean car title was
mistakenly sent to Applicant’s mother. Thereafter, Wells Fargo stopped accepting
Applicant’s payments and wrote the loan off as a business loss. Applicant still has the
car, but he has not been able to reach a settlement or other resolution with the lender.
According to credit reports, Applicant owes in excess of $18,000 for the rest of the loan.
He is adamant that this debt is a mistake, and that he did not miss any payments. (Hx.
3; Gx. 1; Gx. 2; Gx. 4; Gx. 5; Tr. 63 - 68)
Applicant attended a vocational school from September 2006 until December
2010. He was unable to complete his studies because, after switching his major, he
 See Directive. 6.3.5
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could not sign up for all of his prerequisite courses. Applicant financed his tuition with a
combination of federally-subsidized and private student loans. He has consolidated his
loans and, in August 2013, was granted an economic hardship forbearance that expires
in August 2014. Applicant disagrees with the total student loan debt alleged in SOR 1.t
of $30,484. He insists the actual balance due after consolidation is no more than
$17,000. (Hx. 3; Gx. 5; Ax. A; Tr. 68 - 70)
Beginning in 2012, Applicant and his wife have been trying to negotiate with their
creditors and resolve their debts. They were able to pay the $196 credit card debt
alleged at SOR 1.p, and initially, they paid credit correction firms to clean up their credit
history. But they soon realized that those firms would not help resolve their past-due
debts. Despite direct contact with their creditors, Applicant has not been able to afford
the payments demanded or identify the exact amounts owed. (Hx. 3; Tr. 75 - 77)
In 2013, Applicant began working with his pastor and other parishioners to
improve how he manages his personal finances and to devise ways of resolving his
debts. Applicant resisted suggestions that he seek bankruptcy protection. However, in
October 2013, his wife was hospitalized for surgery at a time when she was not covered
by his medical insurance. They both have been covered since January 2014, but as a
result of her uninsured hospitalization, they incurred a $57,000 debt they cannot pay.
They immediately began the process of filing a Chapter 13 petition that was pending
approval as of this hearing. The filing process included a financial counseling course,
which Applicant completed in January 2014. Under the proposed plan, which Applicant’s
attorney is confident will be approved by the time this decision is issued, Applicant pays
$456 monthly for the next 60 months. As of the hearing, he had already made two
payments through payroll allotments. All available information about his bankruptcy
petition shows his payment plan has been established. Except for his student loans,
which are still in forbearance, all of the unpaid debts alleged in the SOR are included in
the bankruptcy petition. (Hx. 3; Gx. 6 - 10; Ax. B; Ax. C; Tr. 37 - 38, 51 - 56, 70, 75, 92 -
99, 104 - 109)
Applicant and his wife have not incurred any new unpaid debts since 2012. They
file their tax returns on time, and they live well within their means. They have enough
money remaining each month after expenses, including the Chapter 13 payments, to
avoid incurring unplanned debts, and will have enough to make payments on his
student loans beginning in August 2014. Applicant has been entrusted by his pastor
with the keys to the church and is held in high esteem for his devotion to the parish and
for his reliability and hard work as a parish volunteer. (Tr. 56 - 57, 70, 72 - 73)
Policies
Each security clearance decision must be a fair, impartial, and commonsense
determination based on examination of all available relevant and material information,5
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)
 See Department of the Navy v. Egan, 484 U.S. 518 (1988).6
 See Egan, 484 U.S. at 528, 531.7
 See Egan; AG ¶ 2(b).8
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of the 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.
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 to6
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.  7
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.8
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Analysis
Financial Considerations
Available information is sufficient to support all of the SOR allegations. The facts
established raise a security concern about Applicant’s finances that is addressed 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. Compulsive
gambling is a concern as it may lead to financial crimes including
espionage. Affluence that cannot be explained by known sources of
income is also a security concern. It may indicate proceeds from
financially profitable criminal acts.
More specifically, available information requires application of the disqualifying
conditions at AG ¶¶ 19(a) (inability or unwillingness to satisfy debts); and 19(c) (a
history of not meeting financial obligations) As to AG ¶ 19(a), the record shows
Applicant has been unable, not unwilling, to repay his past-due debts.
I have also 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;
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.
The mitigating conditions at AG ¶ 20(a) and (b) apply. Applicant’s circumstances
have changed for the better since he began working for his current employer and since
he remarried. He has not incurred new debts through mismanagement of his finances or
irresponsible conduct. However, his wife’s hospitalization presented a debt that was
beyond their control as it was unplanned and not covered by medical insurance.
Nonetheless, he and his wife are now repaying his debts through Chapter 13
bankruptcy. He now has a positive monthly cash flow, and will be able to start repaying
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his student loans later this year without compromising his financial health. More
important, he and his wife now have medical insurance, the absence of which has been
the cause of much of his debt. The delinquent car loan appears to be a mistake that
was not caused by Applicant, who made payments as required until there was a mix-up
by the lender. As to counseling, Applicant has received help from his church in the form
of personal and financial counseling, and his current finances are sound. The record as
a whole shows that Applicant is now resolving his debts and manages his finances so
as to reduce the likelihood his financial problems will recur. On balance, I conclude he
has mitigated the security concerns raised by his past-due debts.
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 37 years old and presumed to be a
mature, responsible adult. Although he left the Army under adverse circumstances, he
has been gainfully employed for all but four months since at least March 2000. He is
responsible for supporting a large blended family, and all indications are that he has
acted responsibly in this regard. Applicant has a good reputation at work, and he is an
upstanding member of his church. A fair and commonsense assessment of all available
information shows that Applicant’s finances no longer present an unacceptable security
risk.
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: FOR APPLICANT
Subparagraphs 1.a - 1.t: For Applicant
Conclusion
In light of all of the foregoing, it is clearly consistent with the national interest for
Applicant to have access to classified information. Applicant’s request for a security
clearance is granted.
MATTHEW E. MALONE
Administrative Judge