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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)       ISCR Case No. 14-05292
)
Applicant for Security Clearance )
Appearances
For Government: David Hayes, Esquire, Department Counsel
For Applicant: Pro se  
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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 denied.
Statement of the Case
Applicant completed and certified an Electronic Questionnaire for Investigations
Processing (e-QIP) on March 18, 2014. The Department of Defense (DOD) issued
Applicant a Statement of Reasons (SOR) on November 8, 2014, 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 2; Item 3.1
Item 2; Item 3.2
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Applicant received the SOR, and he submitted a notarized, written response to
the SOR allegations dated December 1, 2014. He 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 June 8, 2015. Applicant received the FORM on June 15,
2015. He had 30 days from receipt of the FORM to file objections and submit material in
refutation, extenuation, or mitigation. He did not submit a response. DOHA assigned
this case to me on August 3, 2015. The Government submitted five exhibits, which have
been marked as Items 1-5 and admitted into the record.
Findings of Fact
In his Answer to the SOR, Applicant admitted all the factual allegations of the
SOR. His admissions are incorporated herein as findings of fact. After a complete and
thorough review of the evidence of record, I make the following findings of fact.  
Applicant, who is 40 years old, works as a rigger for a DOD contractor. He began
his current employment in April 2014. He previously worked as a driver for several
companies between 2004 and 2014 with one exception. From January 2008 until
August 2009, Applicant operated his own transit business. He ceased operations
because the company was bankrupt. Applicant served on active duty in the United
States Army from July 1993 until January 1998, when he received an honorable
discharge. He served in the Army National Guard from December 1999 until December
2008, when he received an honorable discharge.1
Applicant graduated from high school in 1993. He and his wife married in May
2005. They have an eight-year-old daughter. Applicant and his first wife married in June
1995 and divorced in April 1997. They have a 19-year-old daughter. He also has a 25-
year-old stepson and a 20-year-old stepdaughter.2
Applicant’s current income and monthly expenses are unknown, as he did not
provide a budget and copies of his earnings statements. The record lacks any evidence
that he has received financial counseling.
The SOR identified 12 purportedly continuing delinquencies totaling
approximately $53,186 as reflected by credit reports from 2014 and 2015. Some
accounts have been transferred, reassigned, or sold to other creditors or collection
agents. Other accounts are referenced repeatedly in both credit reports, in many
instances duplicating other accounts listed, either under the same creditor or collection
agency name or under a different creditor or collection agency name. Some accounts
are identified by complete account numbers, while others are identified by partial
Item 3.3
Item 4.4
Item 1.5
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account numbers, in some instances eliminating the last four digits and in others
eliminating other digits.
Applicant advised that his unpaid debts are the result of his failed business. He
started his business in January 2008 just as the economic decline began. Because the
economy seriously declined, he was unable to develop his business, and it failed. He
told the investigator from the Office of Personnel Management during his April 2014
personal subject interview that he intended to pay his debts in the future. He also
indicated that a tax lien had been filed against him; however, he paid the debt, and the
lien has been released. The record does not have any evidence to support this
statement.3
 
The credit reports of record reflect that the debts in SOR ¶ 1.f ($1,134) and ¶ 1.g
($1,133) are the same, as the account numbers are the same. Likewise, the debts in
SOR  ¶ 1.h ($982) and ¶ 1.i ($678) are the same because the account numbers are the
same. The creditors identified in ¶ 1.f and ¶ 1.h are collection agencies, not original
creditors. SOR allegations ¶1.g and ¶ 1.i are found in favor of Applicant.4
Applicant acknowledged the SOR debts. He has not provided any documentation
showing that he paid any of the remaining SOR debts. He has not provided any
documentary evidence that he contacted the creditors to negotiate a settlement or a
payment plan for the remaining debts totaling more than $51,000.                                   5
                                                                                                                
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.
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.
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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
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
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(c) a history of not meeting financial obligations. 
Applicant developed significant financial problems when his business failed in
2009. 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:
(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; and
(d) the individual initiated a good-faith effort to repay overdue creditors or
otherwise resolve debts.
Applicant’s debts stem from his failed transportation business. He started his
business in early 2008, just as the economy began to decline. The economic slowdown
had a direct impact on his business, which is a factor beyond his control. AG ¶ 20(b) is
only partially applicable because Applicant has not shown that he acted reasonably
under the circumstances to resolve his debts.
Two SOR debts are resolved because these debts are duplicate listings in the
SOR and the 2014 credit report. AG ¶ 20(c) applies only to SOR allegations 1.g and 1.i.
The record lacks any evidence that Applicant paid, is paying, or developed a
payment plan for the remaining SOR debts. The remaining mitigating conditions are not
applicable in this case.
 
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):
In assessing whether an applicant has established mitigation under Guideline F, the Appeal Board provided6
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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  (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.  6
In reaching a conclusion, I considered the potentially disqualifying and mitigating
conditions in light of all the facts and circumstances surrounding this case. Applicant
served in the Army and the Army Reserve for almost 15 years and received an
honorable discharge. He tried to establish a transportation business, but the business
failed when the economy declined. He incurred significant debt while operating his
business.
Even if Applicant’s financial difficulties initially arose, in whole or in part, due to circumstances outside of [or7
her] control, the Judge could still consider whether Applicant has since acted in a reasonable manner when
dealing with those financial difficulties.” ISCR Case No. 05-11366 at 4 n.9 (App. BD. Jan. 12, 2007) (citing
ISCR Case No. 99-0462 at 4 (App. Bd. May 25, 2000); ISCR Case No. 99-0012 at 4 (App. Bd. Dec. 1, 1999);
ISCR Case No. 03-13096 at 4 (App. Bd. Nov. 29, 2005)). A component is whether he or she maintained
contact with creditors and attempted to negotiate partial payments to keep debts current.
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Applicant did not provide documentation showing his income and expenses, and
he did not provide a budget. He presented insufficient evidence about what he has done
since becoming employed with his current employer to pay his SOR debts or his other
debts. He did not provide any of the following documentation relating to the SOR
creditors: (1) proof of payments, such as checking account statements, photocopies of
checks, or a letter from the creditor proving that he paid or made any payments to the
creditor; (2) correspondence to or from any creditors to establish maintenance of
contact with creditors;  (3) a credible debt dispute indicating he did not believe he was7
responsible for the debt and why he held such a belief; (4) attempts to negotiate
payment plans, such as settlement offers or agreements to show that he was attempting
to resolve these SOR debts; (5) evidence of financial counseling; or (6) other evidence
of progress or resolution of his SOR debts.
It is well settled that once a concern arises regarding an applicant’s security
clearance eligibility, there is a strong presumption against the grant or renewal of a
security clearance. See Dorfmont, 913 F.2d at 1401. Unmitigated financial
considerations concerns lead me to conclude that the grant of a security clearance to
Applicant is not justified at this time. This decision should not be construed as a
determination that Applicant cannot or will not attain the state of reform necessary to
justify the award of a security clearance in the future. With more effort towards
documented resolution of his past-due debts, and a track record of behavior consistent
with his obligations, he may well be able to demonstrate persuasive evidence of his
security clearance worthiness. Based on the facts before me and the adjudicative
guidelines that I am required to apply, I conclude that it is not clearly consistent with the
national interest to grant Applicant security clearance eligibility at this time.
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: AGAINST APPLICANT
Subparagraphs 1.a-1.f: Against Applicant
Subparagraph 1.g: For Applicant
Subparagraph 1.h: Against Applicant
Subparagraph 1.i: For Applicant
Subparagraphs 1.j-1.l: Against Applicant
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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 a security clearance is denied.
                                                              
MARY E. HENRY
Administrative Judge