1
 
                                                             
                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
) ISCR Case No. 14-03595
          )
Applicant for Security Clearance )
Appearances
For Government: Tara R. Karoian, Esq., Department Counsel
For Applicant: Gregory Greiner, Esq.
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Decision
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CURRY, Marc E., Administrative Judge:
The non-collectability of the second mortgage on Applicant’s home that was
foreclosed in 2010 is not a controlling factor when assessing the financial considerations
security concern under the Adjudicative Guidelines (AG). However, when considered in
tandem with the circumstances surrounding Applicant’s financial problems that led to
the foreclosure and her efforts at rehabilitating her finances since then, I conclude that
she has mitigated the security concern. Clearance is granted. 
Statement of the Case
On December 5, 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 (DOD) Directive 5220.6, Defense
Industrial Personnel Security Clearance Review Program (January 2, 1992), as
amended (Directive); and the AGs implemented by the DOD on September 1, 2006.
2
 
 On December 22, 2014, Applicant answered the SOR, denying all of the
allegations except subparagraph 1.c. She requested a hearing whereupon the case was
assigned to me on June 8, 2015. DOHA issued a notice of hearing on August 3, 2015,
scheduling the hearing for August 25, 2015.
The hearing was held as scheduled. At the hearing, I  received four Government
exhibits (GE 1 - GE 4), 13 Applicant exhibits (AE A - AE K), and the testimony of
Applicant and a character witness. At the close of the hearing, I left the record open at
Applicant’s request, to allow her to submit additional evidence. Within the time allotted,
Applicant submitted one additional document that I incorporated into the record as AE L.
I took administrative notice of an e-mailed post-hearing memorandum that Applicant’s
counsel submitted with AE L, and Department Counsel’s response, marking them as
Hearing Exhibits (HE) I and II, respectively. The transcript was received on September
2, 2015.
Findings of Fact
Applicant is a 36-year-old woman with two children, ages 10 and 14. She was
married previously for nine years from 2000 through her divorce in 2009. (Tr. 32) She
and her husband were separated for two years before the court finalized the divorce.
She has physical custody of her children. (GE 1 at 24-25) 
In 2005, Applicant began taking online college courses. She is majoring in
homeland security and emergency preparedness and needs to complete one additional
class to earn her degree. (Tr. 65) 
Applicant is a veteran of the U.S. Navy where she served from 1999 to 2003.
She was discharged honorably. (Tr. 30) Applicant works in human resources as a
program manager for a defense contractor. Her duties include in-processing new
employees, ensuring that they are properly cleared, and have their information
technology accounts activated before beginning work. (Tr. 26) She has worked in this
position since 2005, and has held a security clearance since 2000. ( GE 1 at 12; Tr. 30) 
Applicant is highly respected on the job. According to her current supervisor, with
whom she has worked for eight years, she is “one of the better security professionals
[he has] ever worked with.” (Tr. 17) According to her second-level supervisor, “she is a
key focal point of [their] program,” and has “consistently displayed the highest
professional conduct.” (GE 1 at 19-20)   
In July 2004, Applicant and her then husband purchased a home for
approximately $293,000. (Tr. 74) They financed the purchase with two mortgages, as
listed in SOR subparagraphs 1.a and 1.e, respectively. Also, they financed the purchase
of furniture for approximately $12,000, as alleged in subparagraph 1.b and duplicated in
subparagraph 1.d. (Tr. 81) 
Applicant recovered from her bout of depression and no security concerns related to this past psychological1
problem were alleged in the SOR.
3
 
Applicant and her husband separated in 2007. Their divorce was contentious.
Much of their problems involved Applicant’s husband’s irresponsible handling of money.
He incurred $20,000 of debt on credit cards that were jointly in Applicant’s name. (GE 1
at 36) Applicant was emotionally devastated by the separation. At one point, she had to
be hospitalized for suicidal ideation.  (GE 4 at 11) 1
At or about the time of their separation, Applicant and her husband executed a
separation agreement. (AE A) Under the agreement, he agreed to pay half of the
mortgage, property taxes, homeowner association fees, utilities, and homeowners’
insurance. Also, he agreed to pay half of their car-related expenses, together with the
balance of the furniture loan, and any credit card debt incurred through the date that
they separated.  (AE A at 1)
Applicant’s estranged husband satisfied the credit card debt (Tr. 71), but he
stopped payment on the mortgage-related expenses after 11 months, and never made
any payments on the homeowner association fees and the utilities. (Tr. 36; GE 4 at 9)
With no help paying the debts jointly incurred with her husband, Applicant began
struggling to make ends meet, paying debt with help from relatives, and by withdrawing
$20,000 from her 401(k) account. By the time their divorce was finalized in February
2009, her debts had become delinquent and she had liquidated all of her retirement
savings.
As part of the divorce decree, the court ordered Applicant to be responsible for all
of the jointly-incurred credit card debt and the furniture loan. (Tr. 38) Also, the court
ordered that Applicant and her ex-husband short sell their home within 30 days of the
divorce decree, and that her ex-husband pay her $100 monthly to satisfy the mortgage
expenses that he agreed to pay Applicant per their original separation agreement. (Tr.
37) Over the years, his payment has been sporadic. (Tr. 41)
Applicant and her ex-husband were unable to sell the home, as the real estate
market was still poor as a result of the 2008 collapse. Consequently, the primary
mortgage was foreclosed in April 2010. (AE L at 4) The second mortgage on the home
was in default when the foreclosure occurred, but was not included in the foreclosure
action. (AE D at 39) 
In October 2010, the mortgagee resold Applicant’s home. (AE L at 9) The
primary mortgage balance, as listed in subparagraph 1.a,  was satisfied through the
sale. (AE L at 9) The secondary mortgage, as listed in subparagraph 1.e, was not
included in the foreclosure proceeding, and it has been charged off. Applicant’s counsel
contends that Applicant is no longer responsible for this mortgage because the statute
of limitations for filing a foreclosure claim has expired. The balance totals $97,000.  
4
 
The debt listed in subparagraph 1.b, totalling approximately $16,000, is a
delinquent credit card account. Applicant contacted the collection agent and negotiated
a settlement. She satisfied it with a lump-sum payment in August 2015. (AE C)
The debt listed in subparagraph 1.c is a credit card. The balance totals $5,000.
(Tr. 51-52) Applicant’s ex-husband did not incur any of this balance. Applicant used it on
medical bills, attorney fees, counseling for her children, and “anything that popped up
during the divorce that [she] couldn’t afford out of pocket.” (Tr. 91) In 2007, the balance
was approximately $15,000. (Tr. 51, 71) Between 2007 and 2009, Applicant made
approximately $11,000 of payments. (AE E at 4, 6-7, 10-15, 17-20, 22, 24) She stopped
making payments in March 2009 after she depleted her savings. She intends to focus
on satisfying this debt now that she has satisfied the debt listed in subparagraph 1.b.
Applicant keeps a budget. (AE G) She has approximately $765 of monthly
discretionary income. She has begun replenishing her retirement savings, and now has
$8,000 invested in her 401(k). (Tr. 92) She receives $355 of monthly child support
payments from her ex-husband. Initially, his payments were erratic. She then went to
court and arranged for payments to be made through the state’s office of child support
enforcement. (Tr. 88-89) 
When Applicant began having marital and financial problems, she informed her
supervisor. He has attended many of her court hearings. (Tr. 19) He considers her “one
of the strongest women [he has] ever met [in] trying to be a security professional, have
a profession, to raise her children [and] to deal with the legal issues brought on” by her
divorce. (Tr. 19) 
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.
5
 
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) Applicant’s inability to keep up with her debts led to the foreclosure of her
home and the incurrence of $20,000 of unsecured debt. AG ¶ 19(a), “inability or
unwillingness to satisfy debts,” applies.
The following mitigating conditions 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; and
(d) the individual initiated a good-faith effort to repay overdue creditors or
otherwise resolve debts.
Marital problems contributed significantly to Applicant’s financial problems. Her
ex-husband was a spendthrift who charged purchases on joint credit cards and repaid
them sporadically. Since their separation, his child support payments have been
similarly erratic. Applicant’s financial problems reached their nadir in 2010 when her
inability to sell her marital home, as the divorce court ordered, led to its foreclosure.
Throughout the period Applicant struggled financially, she attempted to stay afloat,
using money from her retirement account to help pay for home maintenance expenses,
therapy for her children, and expenses related to her divorce. 
 Applicant recently settled and paid a $16,000 debt, as listed in 1.b, and is
planning on addressing the remaining unsecured debt, listed in subparagraph 1.c. She
now keeps a budget. Since obtaining a child support order, she consistently receives
child support from her ex-husband. She has $765 of monthly discretionary income, and
has begun replenishing her retirement savings. 
Applicant’s second mortgage on her foreclosed home, totalling $97,000, remains
outstanding, and she has made not plans to satisfy it. Her attorney argued that it is
statutorily invalid, as the statute of limitations for the secondary mortgagee to file a claim
has expired. 
6
 
Applicant’s counsel is correct. (See State Code Ann. § 7-105(c)(v)(6)) However,
the non-collectability of a debt has limited probative value in security clearance
evaluations. Regardless of the debt’s collectability, it remains a debt Applicant incurred
and did not satisfy. As such, it raises questions about Applicant’s judgment and
responsibility.
Conversely, Applicant did not default on this mortgage as a result of foolish real
estate speculation or financial mismanagement. Instead, she defaulted only after
struggling to pay her debts, depleting her retirement savings in the process, for two
years after her marital separation with minimal help from her estranged husband.
Morever, the non-collectability of the debt, thought not controlling, minimizes the
vulnerability to coercion. Under these circumstances, I conclude that all of the mitigating
conditions, as set forth above, apply, notwithstanding the unresolved second mortgage.
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: 
(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.
Much of Applicant’s financial problems were caused by circumstances beyond
her control. Not only has she been working to overcome these problems, she has been
doing so while raising her children and coping with the emotional devastation of the
divorce. While addressing these challenges, she has excelled on the job. I conclude that
the negative security ramifications of the second mortgage that Applicant did not satisfy
is outweighed by the surrounding circumstances and the steps that she has taken to
rehabilitate her finances. 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
Subparagraph 1.a-1.e: For Applicant
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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