DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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--------------------------------- )       ISCR Case No. 14-03384
)
)
Applicant for Security Clearance )
Appearances
For Government: Caroline E. Heintzelman, Department Counsel
For Applicant: Pro se
October 2, 2015
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Decision
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LOKEY ANDERSON, Darlene D., Administrative Judge:
The Applicant submitted her Electronic Questionnaire for Investigations
Processing (e-QIP) dated April 14, 2013.  (Government Exhibit 2.)  On September 2,
2014, the Department of Defense (DoD), pursuant to Executive Order 10865 and
Department of Defense Directive 5220.6 (Directive), dated January 2, 1992 (as
amended), issued a Statement of Reasons (SOR) to the Applicant, which detailed
reasons why the DoD could not make the preliminary affirmative finding under the
Directive that it is clearly consistent with the national interest to grant or continue a
security clearance for the Applicant and recommended referral to an Administrative
Judge to determine whether clearance should be denied or revoked.
Applicant responded to the SOR in writing on September 29, 2014, and elected
to have the case determined on a written record in lieu of a hearing.  Department
Counsel submitted the Government’s File of Relevant Material (FORM) to Applicant on
April 17, 2015.  Applicant received the FORM on April 22, 2015.  Applicant was
instructed to submit information in rebuttal, extenuation or mitigation within 30 days of
receipt.  Applicant submitted a response to the FORM, referred to as Applicant’s Exhibit
A.  This case was assigned to the undersigned on May 29, 2015.  Based upon a review
of the pleadings, and exhibits, eligibility for access to classified information is denied.
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 FINDINGS OF FACT
Applicant is 58 years old.  She has a high school diploma and an associate’s
degree.  She is employed with a defense contractor as a Receptionist/Administrative
Assistant and is seeking to obtain a security clearance in connection with this
employment.
The Government opposes Applicant's request for a security clearance, on the
basis of allegations set forth in the Statement of Reasons (SOR).  The following findings
of fact are entered as to each paragraph and guideline in the SOR:
Paragraph 1 (Guideline F - Financial Considerations)  The Government alleges that
Applicant is ineligible for clearance because she is financially overextended and at risk
of having to engage in illegal acts to generate funds.      
Applicant has an extensive history of delinquent indebtedness.  She admits each
of the allegations set forth in the SOR.  Between the years of 2004 and 2013, Applicant
experienced unexpected hardships that contributed to her financial indebtedness.
Namely, a divorce from her first husband, two work lay-offs followed by 45 months of
unemployment, and a second husband’s death.  When she returned to the workforce, in
2013, on a full-time basis, she found it difficult to get caught up with her bills.     
From 2011 to the present, Applicant has been self-employed operating her own
business from her home as a bankruptcy petition preparer.  She works about two to four
hours a week around her current employment, and does not have a business license.
In 2012, she started receiving a pension benefit from her previous employer for her and
her deceased husband. 
Applicant has filed bankruptcy five times between 1988 and 2013.  She filed for
Chapter 7 Bankruptcy protection for the first time in about 1988.  She explained that at
that time, she was divorcing her first husband, and she did not make enough money to
pay her half of the marriage bills.  Her debts were discharged.  
In 1997, Applicant filed for Chapter 13 Bankruptcy protection.  Shortly after filing,
she had a car accident and incurred serious head injuries that required hospitalization.
She states that her attorney told her that she should ask the court to dismiss the
bankruptcy as he was going to received an adequate amount of money from the
settlement to pay her bills.  The bankruptcy petition was dismissed in 1998.  
In May 2006, Applicant filed for Chapter 7 Bankruptcy protection.  This time her
second husband had died from cancer and she was left with his medical expenses that
she could not afford to pay.  She was also laid of from work due to a reduction in force
in April 2006.  She was unemployed from about eight months from April 2006 until
January 2007.  Her debts were discharged in October 2006.    
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In February 2010, Applicant filed for Chapter 13 bankruptcy protection.  This time
she wanted help paying her federal and state back taxes, and wanted to avoid having
her wages garnished.  After filing this petition, she was laid off from her employment.
Applicant claims that she was laid off due to a reduction in force.  
Her background investigation discloses that at one time she had been issued a
letter of reprimand for failing to show up for work.  She was unable to go to work as she
had been arrested for DUI and was in jail.  She had her brother report her absence in a
timely manner to her employer on her behalf.  Applicant refused to sign the letter of
reprimand and nothing more became of the situation.  After being laid off of the job,
Applicant tried to keep up with the payment to the court, but her unemployment benefits
were not enough to do so.  The court dismissed her bankruptcy petition in April 2011.
At this point, all of her delinquent debt remained owing.
Applicant was either unemployed or underemployed from February 2010 until
March 2013.  She was hired by her current employer and began working full time in
March 2013.  At that time, she applied for a security clearance, and reported to the
investigator when questioned about her excessive debt that she would re-file her
Chapter 13 bankruptcy since her previous one was dismissed.
In August 2013, Applicant refiled her Chapter 13 bankruptcy petition.
(Government Exhibit 9.)  She states that she has been on her three year plan for one
year and nine months.  She states that she currently has a payroll deduction of $100
per pay period sent to the trustee for distribution of monies to her creditors.  She states
that she is currently up to date with her payments to the court.  Applicant contends that
she will not have a discharge date until all of the monies due to the court are paid in full
and she estimates this to be August 2016.  (Applicant’s Exhibit A.)            
Credit reports of the Applicant dated March 26, 2015; May 29, 2014; April 24,
2013; and November 2006, reflect that each of the delinquent debts in the SOR were at
one time owing.  (Government Exhibit 5, 6, 7, and 8.)  Presently, she has twenty-one
past due debts totaling approximately $26,000.  These debts include delinquent federal
income taxes, four judgments filed against her by various creditors, an eviction for back
rent owed, and other miscellaneous delinquent debt.    
POLICIES
Enclosure 2 of the Directive sets forth adjudication policies divided into
"Disqualifying Factors" and "Mitigating Factors."  The following Disqualifying Factors
and Mitigating Factors are found to be applicable in this case:
Guideline F (Financial Considerations)
18.  The Concern.  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
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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. 
Conditions that could raise a security concern:
19.(a) inability or unwillingness to satisfy debts; and
19.(c) a history of not meeting financial obligations. 
Condition that could mitigate security concerns:
None.
In addition, as set forth in Enclosure 2 of the Directive at pages 18-19,  in
evaluating the relevance of an individual’s conduct, the Administrative Judge should
consider the following general factors:
a.  The nature, extent, and seriousness of the conduct and surrounding
circumstances;
     b.  The circumstances surrounding the conduct, to include knowledgeable
participation;
c.  The frequency and recency of the conduct;
d.  The individual’s age and maturity at the time of the conduct;
e.  The extent to which participation is voluntary;
f.  The presence or absence of rehabilitation and other permanent behavior
changes;
g.  The motivation for the conduct; 
h. The potential for pressure, coercion, exploitation or duress; and
 i.  The likelihood of continuation or recurrence.
The eligibility criteria established in the DoD Directive identify personal
characteristics and conduct, which are reasonably related to the ultimate question,
posed in Section 2 of Executive Order 10865, of whether it is “clearly consistent with the
national interest” to grant an Applicant’s request for access to classified information.
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The DoD Directive states, “The adjudicative process is an examination of a
sufficient period of a person’s life to make an affirmative determination that the person is
an acceptable security risk.  Eligibility for access to classified information is predicated
upon the individual meeting these personnel security guidelines.  The adjudicative
process is the careful weighing of a number of variables known as the whole-person
concept.  Available, reliable information about the person, past and present, favorable
and unfavorable should be considered in reaching a determination.” The Administrative
Judge can draw only those inferences or conclusions that have reasonable and logical
basis in the evidence of record.  The Judge cannot draw inferences or conclusions
based on evidence, which is speculative or conjectural in nature.  Finally, as
emphasized by President Eisenhower in Executive Order 10865, “Any determination
under this order . . . 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.”
CONCLUSIONS
In the defense industry, the security of classified industrial secrets is entrusted to
civilian workers who must be counted upon to safeguard such sensitive information
twenty-four hours per day, seven days per week.  The Government is therefore
appropriately concerned when available information indicates that an Applicant for
clearance may be involved in instances of financial irresponsibility, which demonstrates
poor judgment or unreliability.
It is the Government’s responsibility to present substantial evidence to support
the finding of a nexus, or rational connection, between the Applicant’s conduct and the
holding of a security clearance.  If such a case has been established, the burden then
shifts to the Applicant to go forward with evidence in rebuttal, explanation or mitigation,
which is sufficient to overcome or outweigh the Government’s case.  The Applicant
bears the ultimate burden of persuasion in proving that it is clearly consistent with the
national interest to grant him or her a security clearance.
In this case the Government has met its initial burden of proving that the
Applicant has a history of excessive indebtedness (Guideline F).  This evidence
indicates poor judgment, unreliability and untrustworthiness on the part of the Applicant.
Because of the scope and nature of the Applicant's conduct, I conclude there is a nexus
or connection with her security clearance eligibility.
Applicant’s history of indebtedness is troubling.  There is insufficient evidence in
the record to show that she is or can be financially responsible.  Even considering the
unfortunate circumstances that contributed to her financial problems, that include a
divorce, two job lay-offs, and a death, Applicant has not shown that she can be fiscally
responsible on her own.  Her history over the years shows that she has either filed
bankruptcy to discharge or dismiss her indebtedness, but there is no real evidence to
demonstrate that she can live within her means and pay her bills in a timely fashion
without court supervision.    
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Furthermore, Applicant does not provide details regarding how, more specifically, the
divorce from her first husband, and the death of her second husband, impacted her
financially.  It is understandable that loss of employment can cause financial difficulties.
However, even so, Applicant’s indebtedness remains excessive.     
For the past two years, Applicant has been working full time in the defense
industry, part-time in her own business, and receiving pension benefits from her
previous employer.  She states that she is currently complying with the Chapter 13
bankruptcy plan.  (Applicant’s Exhibit A.)  She must continue to establish a pattern of
fiscal responsibility for a prolonged period, indicating that she can now live within her
means and pay her bills on time.  The investigative records show that even when she
was working, she had problems paying her rent.       
Applicant’s history of delinquent indebtedness, without sufficient mitigation,
demonstrates a pattern of unreliability and poor judgment.  Applicant failed to provide
proof of payment, receipts, or any documentation to demonstrate that she has or will
resolve her delinquent debts.  Without more, the Applicant has failed to establish that
she is fiscally responsible.  
Under the particular circumstances of this case, Applicant has not met her
burden of proving that she is worthy of a security clearance.  She has had to use
bankruptcy as a crutch over the past years on five separate occasions.  Thus, it cannot
be said that she can properly handle her financial obligations or that she has made a
good-faith effort to resolve her past due indebtedness with legal assistance.  Under
these particular circumstances, she has not shown that she is or has been reasonably,
responsibly or prudently addressing her financial situation that is of concern to the
Government.  At this point, Applicant has not demonstrated that she can properly
handle her financial affairs or that she is fiscally responsible.  Her debts are significant.
Assuming that she demonstrates a history and pattern of fiscal responsibility, by
resolving her delinquent debts, she may be eligible for a security clearance sometime in
the future.  However, she is not eligible now.  Considering all of the evidence, Applicant
has not introduced persuasive evidence in rebuttal, explanation or mitigation that is
sufficient to overcome the Government's case. 
Under Guideline F (Financial Considerations), Disqualifying Conditions 19.(a)
inability or unwillingness to satisfy debts; and 19.(c) a history of not meeting financial
obligations, apply.  In this case, none of the mitigating conditions are applicable.
Accordingly, I find against the Applicant under Guideline F (Financial Considerations).    
I have also considered the “whole-person concept” in evaluating Applicant’s
eligibility for access to classified information.  Under the particular facts of this case, the
totality of the conduct set forth above, when viewed under all of the guidelines as a
whole, support a whole-person assessment of poor judgement, untrustworthiness,
unreliability, a lack of candor, an unwillingness to comply with rules and regulations,
and/or other characteristics indicating that the person may not properly safeguard
classified information.
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  I have considered all of the evidence presented.  It does not mitigate the negative
effects of her delinquent financial history and the effects that it can have on her ability to
safeguard classified information.  On balance, it is concluded that Applicant has not
overcome the Government's case opposing her request for a security clearance.
Accordingly, the evidence supports a finding against Applicant as to the factual and
conclusionary allegations expressed in Paragraph 1 of the SOR.  
    FORMAL FINDINGS
Formal findings For or Against the Applicant on the allegations in the SOR, as
required by Paragraph 25 of Enclosure 3 of the Directive are:
Paragraph 1:  Against the Applicant.
    Subpara.    1.a. Against the Applicant.
Subpara.    1.b. Against the Applicant.
Subpara.    1.c. Against the Applicant.
Subpara.    1.d. Against the Applicant.
Subpara.    1.e. Against the Applicant.
 Subpara.    1.f. Against the Applicant.
Subpara.    1.g. Against the Applicant.
Subpara.    1.h. Against the Applicant.
Subpara.    1.i. Against the Applicant.
Subpara.    1.j. Against the Applicant.
Subpara.    1.k. Against the Applicant.
 Subpara.    1.l. Against the Applicant.
Subpara.    1.m. Against the Applicant.
Subpara.    1.n. Against the Applicant.
Subpara.    1.o. Against the Applicant.
Subpara.    1.p. Against the Applicant.
 Subpara.    1.q. Against the Applicant.
Subpara.    1.r. Against the Applicant.
Subpara.    1.s. Against the Applicant.
Subpara.    1.t. Against the Applicant.
Subpara.    1.u. Against the Applicant.
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DECISION
In light of all the circumstances presented by the record in this case, it is not
clearly consistent with the national interest to grant or continue a security clearance for
the Applicant.
  Darlene Lokey Anderson
Administrative Judge