1
 
                                                             
                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
) ISCR Case No. 14-03596
          )
Applicant for Security Clearance )
Appearances
For Government: Alison O’Connell, Esq., Department Counsel
For Applicant: Pro se
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Decision
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CURRY, Marc E., Administrative Judge:
Applicant’s financial problems began in 2010 when her marriage and business
began deteriorating. Since then, Applicant has organized her finances, developed a
debt repayment plan, and satisfied approximately $6,200 of delinquent debt listed in the
Statement of Reasons (SOR), together with approximately $15,000 to $20,000 of non-
SOR debt. Applicant has mitigated the security concern. Clearance is granted.
Statement of the Case
On August 1, 2014, the Department of Defense Consolidated Adjudications
Facility (DOD CAF) issued an SOR to Applicant 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; 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 DOD on September 1, 2006.
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 On August 18, 2014, Applicant answered the SOR, admitting all of the
allegations except subparagraph 1.f.  She requested a hearing whereupon the case was
assigned to me on December 1, 2014. DOHA issued a notice of hearing on December
12, 2014, scheduling the hearing for January 15, 2015. The hearing was held as
scheduled. At the hearing, I received four Government exhibits (GE 1-GE 5) and
considered Applicant’s testimony. 
At the close of the hearing, I left the record open, at Applicant’s request, to allow
her to submit exhibits. Within the time allotted, she submitted four exhibits that I
incorporated into the record as Applicant Exhibits (AE) A through AE D. DOHA received
the transcript (Tr.) on January 26, 2015.
Findings of Fact
Applicant is a 49-year-old single woman with one child, age 14. She was married
from 1991 to 2012. It ended in divorce. (Tr. 13) Applicant is a high school graduate who
is currently working toward an associate’s degree in business administration. (Tr. 12)
Since mid-2013, she has worked as a project manager for a government contractor. (Tr.
13) Her duties include recruiting and business process improvement.
Applicant had no financial problems when she was married. (Tr. 15) Her ex-
husband, a wealthy partner at a law firm, earned between $800,000 and $1 million
dollars per year. Consequently, she was not dependent on her nominal part-time
income as a lifestyle coach, a motivational speaker, and seller of high-end luxury health
products to make ends meet. (Tr. 21, Tr. 53)
In approximately January 2010, Applicant merged her business with a friend’s
business.  Previously, Applicant’s business had been home based. Once she merged it
with her friend, she leased office space, causing her to incur significantly higher
overhead costs. (Tr. 23) Over the next year and a half, Applicant spent approximately
$45,000 on business expenses, including $10,000 she charged on a credit card in her
husband’s name. (Tr. 38)
Applicant’s business struggled. At or about the time she was having problems
with her business, her marriage began deteriorating. In January 2011, Applicant and her
husband separated, and by October 2011, her business had failed. (Tr. 13)
Applicant and her husband negotiated a separation agreement. Under the
agreement, Applicant agreed to receive an annual lump-sum payment totalling 12% of
her husband’s net income from his business earnings, together with $3,000 per month
in alimony, and $778 of monthly child support. The monthly alimony was low relative to
her husband’s earnings. However, Applicant accepted this deal anticipating that her
husband’s annual salary would remain in the $800,000 to $1 million range, providing her
with annual alimony of between $95,000 and $100,000. (Tr. 17, 36)
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Applicant’s estranged husband’s earnings never approached the amount he
made when they were together, as his “whole life kind of down spiraled” after their
separation. (Tr. 16)  Consequently, the highest yearly alimony that she received from
him was $60,000 in 2013. By 2014, Applicant’s ex-husband was unemployed. She has
not received any alimony payments since May 2014, and she has not received any child
support payments since December 2014.  (Tr. 28-29, 44)
Saddled with the expenses from her failed business and the reduced income
after her marital separation, Applicant fell behind on her debts. By 2014, she had
incurred approximately $55,000 of delinquent debt, including five credit cards
(subparagraphs 1.a through 1.e), a time share (subparagraph 1.f), and $10,000 owed to
her ex-husband for charges she made on his credit card for her business. (Tr. 38) 
Subparagraphs 1.a and 1.b, totalling approximately $27,000 are owed to the
same bank. Applicant is negotiating a payment plan with the creditor, and will begin
payments after she satisfies the debts owed to the other creditors.
Subparagraph 1.c totals $6,685. Applicant has been satisfying it in monthly
payments of $185. (AE C) She provided supporting documentation of payments
covering the period from June 2014 through January 2015. (AE C) It is unclear from the
record how long she has been making the payments. She anticipates that this debt will
be satisfied by the end of the year. (Tr. 18)
Subparagraph 1.d totals $5,744. Applicant has been making $350 monthly
payments since April 2014. (AE A)
Applicant had satisfied the debt listed in subparagraph 1.e, totaling approximately
$1,500,  through monthly payments ranging between $120 and $190. (AE B).
Subparagraph 1.f is a delinquency owed for a time share property that Applicant
purchased in 2011. She purchased it during the period when she anticipated that she
would be receiving $100,000 of annual alimony. (Tr. 36) The SOR alleges that the debt
totals $3,400. Applicant disputes this amount. She provided no basis for the legitimacy
of her dispute. 
Subparagraph 1.g is the $10,000 debt Applicant owes her ex-husband for the
credit card expenses that she charged on his card for business purchases she made
when they were married. She was paying him $200 per month. When Applicant’s ex-
husband stopped paying alimony, he agreed to forgive this debt. (Tr. 38)
When Applicant and her then-husband structured their separation agreement,
they did not account properly for income tax withholdings. (Tr. 39) Consequently, she
has had trouble paying her income taxes timely. She is current on her income tax
payments through 2012. However, she just recently filed her income tax return for tax
year 2013. She owes $9,000. (Tr. 40) In January 2015, Applicant contacted the Internal
Revenue Service and agreed to satisfy it in increments of $200 per month, deducted
GE 3 is a credit bureau report dated June 27, 2014. The debts in the report are numbered. Applicant satisfied1
debts 10-13, debt 20, and debt 26.
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automatically from her pay. She made her first payment in January 2015. (AE A at 1)
Applicant satisfied approximately $15,000 to $20,000 of debts that were not alleged in
the SOR. (Tr. 53; GE 3 at 2-4)1
Applicant currently lives with her fiance. He pays all of the household expenses
except the groceries. (Tr. 30) Applicant maintains a budget. She earns $47,000
annually, and has approximately $50 of discretionary monthly income. (AE D) 
Policies
The adjudicative guidelines list potentially disqualifying conditions and mitigating
conditions. These guidelines are not inflexible rules of law. Instead, recognizing the
complexities of human behavior, they are applied together with the factors listed in the
adjudicative process. 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.” 
Under Directive ¶ E3.1.14, the Government must present evidence to establish
controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, the applicant is
responsible for presenting “witnesses and other evidence to rebut, explain, extenuate,
or mitigate facts admitted by applicant or proven by department counsel. . . .” The
applicant has the ultimate burden of persuasion for obtaining a favorable security
decision.
Analysis
Guideline F, Financial Considerations
Under this guideline, “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.”
(AG ¶ 18) Between 2010 and 2014, Applicant incurred approximately $55,000 of
delinquent debt. AG ¶ 19(a), “inability or unwillingness to satisfy debts,” and AG ¶ 19(c),
“a history of not meeting financial obligations,” apply.
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The following mitigating conditions under AG ¶ 20 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
(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 financial problems were caused primarily by a marital separation and 
a business failure that both occurred in 2010. Applicant’s income decreased drastically
nearly at the same time the expenses for the failing business began to increase. Since
2011, Applicant has satisfied approximately $6,500 of debt listed in the SOR and
$15,000 to $20,000 of unlisted debt. She satisfied subparagraph 1.e in its entirety and
has been diligently making payments toward the satisfaction of the debts listed in
subparagraphs 1.c and 1.d. 
The debts that Applicant has not addressed, as listed in subparagraphs 1.a, 1.b,
and 1.g, total nearly $40,000. Given Applicant’s progress with debt reduction, I am
confident that she will begin paying subparagraphs 1.a and 1.b, as promised. As for the
$10,000 she owes her ex-husband, as listed in subparagraph 1.g, her explanation that
he has forgiven this debt is credible in light of the fact that he has not recently paid
either her alimony or child support. I conclude AG ¶¶ 20(b) through 20(d) apply.
When asked about the delinquent time share payment, as listed in subparagraph
1.f, Applicant criticized the time share arrangement and expressed her desire to sell it,
but did not provide any evidence setting forth the nature of any dispute. Under these
circumstances, AG ¶ 20(e) is not applicable. Any negative inference generated by the
inapplicability of AG ¶ 20(e) is outweighed by the positive security ramifications of the
meticulous steps Applicant has taken to reduce her indebtedness. I conclude Applicant
has mitigated the financial considerations security concerns.
Whole-Person Concept
Under the whole-person concept, the administrative judge should consider the
nine adjudicative process factors listed at AG ¶ 2(a). They are as follows: 
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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.
Applicant’s financial problems were not caused by profligate spending. Instead
they stemmed from a divorce and a failed business. Applicant has been steadily
satisfying her delinquencies, in a meticulous, well-organized manner. Considering this
case in the context of the whole-person concept, I conclude Applicant has mitigated the
security concern.
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
Subparagraphs 1.a-1.g: 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.
MARC E. CURRY
Administrative Judge