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                              DEPARTMENT OF DEFENSE
               DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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)       ISCR Case No. 14-04608
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Applicant for Security Clearance )
Appearances
For Government: Chris Morin, Esquire, Department Counsel
For Applicant: Pro se
June 23, 2015
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Decision
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GOLDSTEIN, Jennifer I., Administrative Judge:
Applicant incurred substantial delinquent indebtedness and has not filed his
Federal or state income tax returns for the tax years 2010 through 2012. The evidence
is insufficient to mitigate resulting security concerns. Based upon a review of the
pleadings, testimony, and exhibits, eligibility for access to classified information is
denied. 
Statement of the Case
Applicant submitted a security clearance application (SF 86) on December 4,
2013. On October 30, 2014, the Department of Defense Consolidated Adjudications
Facility (DoD CAF) issued a Statement of Reasons (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 for Determining Eligibility for
Access to Classified Information, effective within the Department of Defense after
September 1, 2006. 
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Applicant answered the SOR in writing (AR) on November 12, 2014, and
requested a hearing before an administrative judge. The case was assigned to me on
February 18, 2015. The Defense Office of Hearings and Appeals (DOHA) issued a
Notice of Hearing on March 6, 2015, and I convened the hearing, as scheduled, on April
23, 2015. 
The Government offered Hearing Exhibit (HE) I, and Exhibits (GE) 1 through 4.
All were admitted without objection. Applicant testified on his own behalf and offered
eight exhibits marked Applicant Exhibit (AE) A through H, which were admitted without
objection from Department Counsel. DOHA received the transcript of the hearing (Tr.)
on May 4, 2015. 
Findings of Fact
Applicant is a 62-year-old employee of a defense contractor, where he has
worked since 2008. He is a high school graduate. He was married in 1972 and divorced
in 1974. He has no children. (GE 1; Tr. 27-28.)
In his response to the SOR, Applicant admitted the allegations concerning
delinquent debts set forth in SOR ¶¶ 1.a through 1.h. He denied the four debts identified
in SOR ¶¶ 1.i through 1.l. Applicant’s admissions are incorporated in the following
findings.
In his testimony, Applicant confirmed his admissions that he filed Chapter 13
bankruptcy in 1997, which was discharge in June 2002. He attributed the bankruptcy to
a delinquent mortgage. He again sought the protections of bankruptcy in 2010. He
initially filed for Chapter 13 bankruptcy in 2010, and then converted it to a Chapter 7
bankruptcy in 2013. Applicant’s Chapter 7 bankruptcy was dismissed in July 2013, but
his Chapter 13 bankruptcy case was continued and he received a discharge on March
20, 2014. Applicant indicated he filed for bankruptcy in 2010 because he wanted a
modification to his mortgage. (GE 1; GE 2; Tr. 25-27, 43-47.)
Applicant testified that he has not filed Federal or state income tax returns for the
tax years 2010 through 2014. He believes he is due refunds for those years because he
had the maximum withheld from his paycheck. He testified that he planned to file his
delinquent tax returns with the help of a tax professional within two weeks after the
hearing. He stated that he failed to file his Federal and state income taxes because he
was in mourning over the loss of several friends. He noted that he was delinquent in
filing his Federal and state income tax returns from 1986 to 1991, but that he eventually
filed them late. (Tr. 30-3
Applicant denied: a $1,296 collection account (SOR ¶ 1.i); a debt to a city for $30
(SOR ¶ 1.j); and two medical collection account, the first for $691 (SOR ¶ 1.k) and the
second for $246 (SOR ¶ 1.l). He claimed that he does not owe any of these debts.
However, he failed to provide documentation to support his claims. He testified that he
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had not made contact with any of these creditors. These four debts are not resolved.
(GE 3; GE 4; Tr. 36-42.)
Applicant presented seven letters of recommendation that attested to his
professionalism, patriotism, and work ethic. (AE A through G.) He presented copies of
three certificates he earned. (AE H.) He presented no budget or proof of financial
counseling.
Policies
When evaluating an applicant’s suitability for a security clearance, the
administrative judge must consider the adjudicative guidelines (AG). In addition to brief
introductory explanations for each guideline, the adjudicative guidelines list potentially
disqualifying conditions (DCs) and mitigating conditions (MCs), which are to be 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 AG ¶ 2 describing the adjudicative process. The administrative judge’s
overarching adjudicative goal is a fair, impartial, and commonsense decision. According
to AG ¶¶ 2(a) and 2(c), the entire process is a conscientious scrutiny of applicable
guidelines in the context 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 the 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. Likewise, I have avoided drawing inferences
grounded on mere speculation or conjecture.
Under Directive ¶ E3.1.14, the Government must present evidence to establish
controverted facts alleged in the SOR. Under Directive ¶ E3.1.15, “[t]he applicant is
responsible for presenting witnesses and other evidence to rebut, explain, extenuate, or
mitigate facts admitted by the applicant or proven by Department Counsel, and has the
ultimate burden of persuasion as to obtaining a favorable clearance decision.” Section 7
of Executive Order 10865 provides: “[a]ny determination under this order adverse to an
applicant shall be a determination in terms of the national interest and shall in no sense
be a determination as to the loyalty of the applicant concerned.”
A person applying for access to classified information seeks to enter 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
1The SOR did not allege Applicant’s failure to file his Federal and state income tax returns for 2013 and
2014. As a result, those years were not considered with respect to the applicability of the disqualifying
conditions.
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the possible risk the 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.
Analysis
Guideline F, Financial Considerations
The security concerns under the guideline for financial considerations are set out
in AG ¶ 18, which reads in pertinent part:      
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. 
The record evidence potentially raises security concerns under three Guideline F
DCs, as set forth in AG ¶ 19: 
(a) inability or unwillingness to satisfy debts; 
(c) a history of not meeting financial obligations; and
(g) failure to file annual Federal, state or local income tax returns as
required or the fraudulent filing of the same.
Applicant has a long history of not meeting his financial obligations, including his
delinquent debts and his failure to file his Federal and state income tax returns. He has
filed bankruptcy twice: in 1997 and in 2010. He has not filed his Federal or state income
taxes for the tax years 2010 through 2012.1 Additionally, he accrued $2,264 in
delinquent debts, and demonstrated neither the means nor any effort to resolve any of
them. The Government raised sufficient security concerns under DCs 19(a), 19(c), and
19(g) thereby shifting the burden to Applicant to rebut, extenuate, or mitigate those
concerns.
The guideline includes five conditions in AG ¶ 20 that could mitigate security
concerns arising from Applicant’s financial difficulties:
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(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;
(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 SOR-listed delinquent debts and unfiled tax returns are recent and
ongoing, without indication that the circumstances under which they arose have
changed. He has neither paid any of his delinquent debts not has he filed his delinquent
tax returns. His history of financial irresponsibility goes back more than 18 years. He
therefore failed to establish substantial mitigation under MC 20(a). 
Applicant also offered insufficient evidence to support significant mitigation under
MC 20(b). While he attributed his failure to file his Federal and state income tax returns
to deaths of his friends, he failed to show he has acted responsibly with respect to this
or any other financial obligation. He incurred all of the debt in question, and has been
fully employed since 2008. This is not responsible action under the circumstances.
Applicant did not provide any evidence of financial counseling. He did not repay
any of his debts. He did not file his delinquent tax returns. He neither documented any
effort to repay or otherwise resolve the substantial remaining SOR-listed delinquent
debts, nor asserted a legitimate basis to dispute their validity. These facts preclude
significant mitigation under MC 20(c), (d), or (e). 
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 the 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.   
I considered the potentially disqualifying and mitigating conditions in light of all
pertinent facts and circumstances surrounding this case. Applicant has incurred
delinquent indebtedness that he has made no effort to repay. He has failed to file his
Federal and state tax returns since 2009. The evidence does not support a finding that
continuation or recurrence are unlikely, or that behavioral changes demonstrate
rehabilitation. He is a mature and experienced individual who is accountable for his
choices and financial irresponsibility. Overall, the record evidence creates ongoing
doubt as to Applicant’s present eligibility and suitability for a security clearance.
Formal Findings
Formal findings for or against Applicant on the allegations set forth in the SOR,
as required by ¶ E3.1.25 of Enclosure 3 of the Directive, are:
Paragraph 1, Guideline F: AGAINST APPLICANT
Subparagraphs 1.a through 1.l: 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.
                                              
JENNIFER I. GOLDSTEIN
Administrative Judge