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                           DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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[NAME REDACTED] )       ISCR Case No. 14-05133
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Applicant for Security Clearance )
Appearances
For Government: Gina L. Marine, Esq., Department Counsel
For Applicant: Pro se
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Decision
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MALONE, Matthew E., Administrative Judge:
Applicant’s financial problems arose through a combination of unforeseen
circumstances and his earlier financial neglect. However, he has taken responsible
steps to correct his finances and he is unlikely to incur delinquent debts in the future.
The security concerns about Applicant’s financial problems are mitigated. His request
for a security clearance is granted.
Statement of the Case
On February 5, 2013, Applicant submitted an Electronic Questionnaire for
Investigations Processing (EQIP) to obtain a security clearance required for his
 In January 2013, Applicant was hired as an intern for the defense contractor that sponsored his application1
for clearance. Applicant was let go in April 2013 when his clearance was not granted because of the issues
in this case. That company will rehire Applicant if his industrial clearance is granted. Since April 2013, he has
worked for several different companies, including his current employer in a position that requires he obtain
a position of trust under DOD Regulation 5220.2-R. After discussion with the parties, I concluded DOHA still
has jurisdiction over the original request for clearance and the facts that are at issue in this case. (Tr. 44 - 46)
  Required by Executive Order 10865, as amended, and by DOD Directive 5220.6 (Directive), as amended.2
 The adjudicative guidelines were implemented by the Department of Defense on September 1, 2006. These3
guidelines were published in the Federal Register and codified through 32 C.F.R. § 154, Appendix H (2006).
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employment at a defense contractor.  Based on the results of the ensuing background1
investigation, Department of Defense (DOD) adjudicators could not determine that it is
clearly consistent with the national interest for Applicant to continue to hold a security
clearance.  2
On February 20, 2015, DOD issued a Statement of Reasons (SOR) alleging facts
which raise security concerns addressed under the adjudicative guideline  for financial3
considerations (Guideline F). Applicant timely responded to the SOR (Answer) and
requested a hearing. The case was assigned to me on August 26, 2015, and I
convened a hearing on October 21, 2015. The parties appeared as scheduled.
Department Counsel presented Government Exhibits (Gx.) 1 - 9. Applicant testified and
presented Applicant’s Exhibits (Ax.) A - D. I held the record open after the hearing to
receive additional information from Applicant. A transcript of the hearing (Tr.) was
received on October 29, 2015. The record closed on November 10, 2015, when I
received Applicant’s post-hearing submission (Ax. E) All exhibits were admitted without
objection.
Findings of Fact
Under Guideline F, the Government alleged that, as of the date of the SOR,
Applicant owed $27,443 for 14 past-due or delinquent debts (SOR 1.a - 1.n). In
response, Applicant admitted 1.a - 1.c, 1.e, and 1.h - 1.n. He denied the remaining
allegations. All of the debts alleged are documented in the credit reports presented by
Department Counsel and were discussed with Applicant in his subject interviews on
March 27 and November 25, 2013. (Gx. 4 - 6) In addition to the facts established by
these exhibits and by Applicant’s admissions, I make the following findings of fact.
Applicant is 34 years old. He holds a bachelor’s degree in computer science and
is studying for a master’s degree in cybersecurity. Applicant enlisted in the Navy in July
1999 and served as a fire control technician until leaving active duty in July 2003. He
subsequently affiliated with the Naval Reserve in 2003 and was a drilling reservist until
March 2006. At that time, he was recalled to active duty and served at sea, most
recently aboard a forward-deployed aircraft carrier until December 2011. (Gx. 1; Gx. 2;
Tr. 6)
 Applicant is trying to correct the classification of his discharge through the Board for Correction of Naval4
Records (BCNR).
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Applicant held a security clearance while he was in the Navy. In June 2009, the
Department of the Navy Central Adjudication Facility (DONCAF) issued Applicant an
SOR citing, in relevant part, security concerns about his finances. Applicant’s response
to the SOR provided sufficient information for DONCAF to award him a clearance in
March 2010, conditioned on meeting certain reporting requirements over the next six
months. Applicant disclosed in his EQIP that in December 2011, his clearance was
revoked. He stated in his first subject interview that the revocation was based solely on
his failure to comply with the DONCAF’s reporting requirements. He further claimed that
he did not receive the letter stating those requirements. Because he no longer
possessed the clearance required for his rate, Applicant was released early from his
active duty recall with a general discharge. Thereafter, he returned to school full time
under the GI Bill to complete his bachelor’s degree and to begin studying for a master’s
degree.  (Gx. 2; Gx. 7 - 9; Tr. 10, 92 - 95)4
Applicant was married from July 1999 until divorcing in July 2006. He remarried
in October 2007, but again divorced in November 2010. Applicant and his current wife,
an electronics engineer who he met while both were in the Navy, have been married
since March 2011. They recently had a child together. In addition, Applicant adopted his
wife’s two children and has three other children of his own, two of whom live with
Applicant and his wife. (Gx. 1; Tr. 78, 92, 99)
Applicant’s financial problems started around 2003 or 2004. He was
overextended financially and, by his own admission, he did not pay close attention to
such matters. Being in the service, he received a regular paycheck and he often lived
aboard ship, which obviated the need to attend to things like rent or budgeting for food
and clothing. Applicant also accrued student loan debts that came due when he did not
initially complete his studies at a state university. When he went through his divorce in
2006, he was required to pay child support. He also had to pay other expenses when he
was divorced a second time in 2010. After Applicant was unexpectedly discharged from
the military at the end of 2011, he did not have any income other than stipends from the
GI Bill for his college work until he found employment from March 2012 until October
2012. He was unemployed until January 2013, when he was hired as an intern by the
company that sponsored his request for clearance. (Gx. 1 - 3; Tr. 62 - 63)
Applicant avers he knew in 2011, when he was issued an SOR by the DONCAF,
that he had to resolve his past-due debts and improve his overall finances. His efforts
began in earnest when he submitted his EQIP in 2013. In his first subject interview in
March 2013, Applicant stated his intention to verify the status of his debts and to resolve
them as soon as he was able. At the time of his second interview in November 2013,
Applicant stated that he had paid or otherwise resolved the debts later alleged at SOR
1.d (a disputed charge for a remote learning textbook), 1.f (a disputed debt for a credit
card issued by a previous employer), 1.g (a disputed cell phone account), and 1.j (a
 See Directive. 6.3.5
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debt for a missed appliance rental payment). In response to the SOR and at his hearing,
Applicant provided documentation of the resolution of those debts, as well as the debts
at SOR 1.a (the remainder after resale of a repossessed automobile) and 1.i (a past-
due cable television account from Applicant’s time at a Navy training facility). Applicant’s
exhibits, including credit reports from 2015 provided by both Department Counsel and
the Applicant, show those debts have been paid or are no longer listed in his credit
history. (Gx. 6; Ax. A; Ax. E; Tr. 46 - 47, 95 - 96).
Most of the debt alleged in the SOR consists of delinquent student loan
accounts. The debt at SOR 1.b was resolved through wage garnishment after Applicant
challenged the debt. He claimed he had taken out a loan for college courses but never
actually matriculated. He stated he never received any funds from that loan, but there
may have been a disbursement to the school. After a settlement was agreed to and the
school repaid a portion of the total amount of the loan, Applicant’s pay was garnished to
satisfy the remaining balance. (Gx. 2; Gx. 3; Tr. 47 - 54)
As to the remaining student loan debts alleged at SOR 1.j - 1.n, Applicant had to
bring those loans current before he could finance the tuition for his master’s degree. He
completed a student loan rehabilitation program for the federally-subsidized loans and
they have been consolidated into a single loan that is now in deferment as long as
Applicant carries a minimum course load. State education loans alleged at SOR 1.k -
1.m have been paid. (Answer; Gx. 4; Gx. 6; Ax. A - C; Tr. 31, 54 - 64) 
 As an intern in 2013, Applicant was paid at $17 an hour. Since then, his pay
from different jobs has varied between $55,000 annually to his current salary of about
$67,000 annually since June 2014. He twice has received financial counseling advice
from a large insurance and finance company, with whom he and his wife have begun a
structured savings plan. Applicant and his wife, who earns about $70,000 annually,
recently bought a house using a VA loan. A prerequisite of receiving that financing
benefit was the completion of a personal finance and budget course. They received a
$7,000 refund from their 2014 income tax return, which they used to pay off their car
loans and some of his wife’s debts. Available information shows Applicant has a
significant positive cash flow each month and that he has not incurred any new
delinquencies. (Gx. 4; Gx. 6; Ax. A; Tr. 77 - 89, 99 - 102)
Policies
Each security clearance decision must be a fair, impartial, and commonsense
determination based on examination of all available relevant and material information,5
and consideration of the pertinent criteria and adjudication policy in the adjudicative
guidelines (AG). Decisions must also reflect consideration of the factors listed in ¶ 2(a)
of the guidelines. Commonly referred to as the “whole-person” concept, those factors
are:
 See Department of the Navy v. Egan, 484 U.S. 518 (1988).6
 See Egan, 484 U.S. at 528, 531.7
 See Egan; AG ¶ 2(b).8
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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. 
The presence or absence of a disqualifying or mitigating condition is not
determinative of a conclusion for or against an applicant. However, specific applicable
guidelines should be followed whenever a case can be measured against them as they
represent policy guidance governing the grant or denial of access to classified
information.
A security clearance decision is intended only to resolve whether it is clearly
consistent with the national interest  for an applicant to either receive or continue to6
have access to classified information. The Government bears the initial burden of
producing admissible information on which it based the preliminary decision to deny or
revoke a security clearance for an applicant. Additionally, the Government must be able
to prove controverted facts alleged in the SOR. If the Government meets its burden, it
then falls to the applicant to refute, extenuate or mitigate the Government’s case.
Because no one has a “right” to a security clearance, an applicant bears a heavy
burden of persuasion.  A person who has access to classified information enters into a7
fiduciary relationship with the Government based on trust and confidence. Thus, the
Government has a compelling interest in ensuring each applicant possesses the
requisite judgment, reliability and trustworthiness of one who will protect the national
interests as his or her own. The “clearly consistent with the national interest” standard
compels resolution of any reasonable doubt about an applicant’s suitability for access in
favor of the Government.8
Analysis
Financial Considerations
Available information is sufficient to support the SOR allegations under this
guideline. The facts established reasonably raise a security concern about Applicant’s
finances that is addressed, in relevant part, at AG ¶ 18, as follows:
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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.
More specifically, this record supports application of the disqualifying conditions
at AG ¶ 19(a) (inability or unwillingness to satisfy debts) and AG ¶ 19(c) (a history of not
meeting financial obligations). Applicant has a history of poor financial management and
of debts dating back to his time in the Navy.
I have also considered the following pertinent AG ¶ 20 mitigating conditions:
(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.
AG ¶ 20(a) partially applies because it appears Applicant’s financial problems are
largely resolved, and his debts were incurred more than five years ago. However, he
acknowledged that before 2011, he was not as attentive to his finances as he should
have been, a fact that reflects adversely on his past judgment. In the same vein, AG ¶
20(b) applies to the extent his debts were caused by uncontrollable circumstances, such
as his early discharge from the Navy and his second divorce. While I am mindful of the
fact that he already was overextended financially when he was discharged from the
Navy, available information about his 2011 loss of clearance shows that it was due to
non-responsiveness to a DONCAF requirement that was not his fault. In that sense his
discharge was unforeseen. Nonetheless, since 2013, Applicant has demonstrated
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sound judgment by paying or resolving most of his debts, and by improving his overall
financial well being. 
AG ¶ 20(c) applies because Applicant has received financial advice and
counseling from a large insurance and finance company, and as part of his application
for a VA-backed mortgage. This has helped him focus on eliminating debt and saving
prudently. Applicant’s efforts to resolve his debts began in earnest about two years ago.
But available information also shows that he was trying to get his financial house in
order around the time of his 2011 discharge. AG ¶ 20(d) applies. Finally, the debts at
SOR 1.d, 1.f, and 1.g were resolved in Applicant’s favor after he disputed them. AG ¶
20(e) applies. 
All of the foregoing shows that Applicant is not likely to incur delinquent debts in
the future. He and his wife earn a better than average annual salary that leaves
sufficient cash remaining each month -- after expenses, debt payments, and savings –
with which to avoid unforeseen financial challenges. On balance, I conclude that the
security concerns raised by the Government’s information about Applicant’s finances
are mitigated.
I also have evaluated this record in the context of the whole-person factors listed
in AG ¶ 2(a). Applicant is a responsible husband and father to his own children and to
his wife’s children whom he adopted. He has acted responsibly to resolve his financial
problems and to stabilize his current finances. A fair and commonsense assessment of
all available information shows that the doubts about Applicant’s continued suitability for
access to classified information raised by his financial problems have been satisfied.  
Formal Findings
Formal findings 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.n: For Applicant
Conclusion
In light of all of the foregoing, it is clearly consistent with the national interest for
Applicant to have access to classified information. Applicant’s request for a security
clearance is granted.
                                       
MATTHEW E. MALONE
Administrative Judge