KEYWORD: Guideline F
DIGEST: The Judge should have discussed Exhibit O pertaining to the schedules short sale of
property.  Adverse decision remanded.
CASENO: 14-05150.a1
DATE: 04/20/2016
DATE: April 20, 2016
In Re:
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Applicant for Security Clearance
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ISCR Case No. 14-05150
APPEAL BOARD DECISION
APPEARANCES
FOR GOVERNMENT
James B. Norman, Esq., Chief Department Counsel
FOR APPLICANT
Ryan C. Nerney, Esq.
The Department of Defense (DoD) declined to grant Applicant a security clearance.  On
April 22, 2015, DoD issued a statement of reasons (SOR) advising Applicant of the basis for that
decision–security concerns raised under Guideline F (Financial Considerations) of Department of
Defense Directive 5220.6 (Jan. 2, 1992, as amended) (Directive).  Applicant requested a hearing. 
On February 23, 2016, after the hearing, Defense Office of Hearings and Appeals (DOHA)
Administrative Judge Noreen A. Lynch denied Applicant’s request for a security clearance. 
Applicant appealed pursuant to Directive ¶¶ E3.1.28 and E3.1.30.
Applicant raised the following issues on appeal: whether the Judge failed to consider all of
the evidence; whether the Judge’s application of the mitigating conditions was erroneous; and
whether the Judge’s whole-person analysis was erroneous.  Consistent with the following, we
remand for a new decision.
The Judge’s Findings of Fact
Applicant has held a clearance since 2005.  In 2007, he bought rental property for about
$238,000.  However, his employer reduced his income, and his tenant stopped paying rent, as a
consequence of which Applicant could not make his monthly mortgage payment.  He attempted to
sue the tenant for rent and to obtain a loan modification but was not successful.  Applicant states that
the home went into foreclosure in 2011.  It was vandalized in 2014.  Applicant has a past-due
amount of over $243,000 on the loan for this property.  He has not sold it, and the balance is not
resolved.  However, he has a contract for a would be short-sale if it is approved.  Other attempts at
short-sales did not meet with success.  His realtor believes that there is “a strong chance” that this
agreement will be accepted.  Decision at 3.  Applicant stopped making payments on the mortgage
in 2008.  In addition, Applicant is indebted to his state for liens in the combined amount of over
$3,200.  These pertain to his rental property.  Applicant submitted a letter from a colleague
commending him for his trustworthiness and professionalism.  
The Judge’s Analysis
The Judge resolved an allegation in Applicant’s favor, one that addressed a debt to a bank. 
However, for the delinquent mortgage and the tax liens she entered adverse findings.  She noted that
the debts in question are unresolved and that, while Applicant has a contract for a short-sale, other
such efforts have been rejected.  Though noting circumstances outside Applicant’s control that
affected his financial problems, she also noted that Applicant’s mortgage problem is eight years old 
and resolution is not yet certain.  
Discussion
 Applicant contends that the Judge did not consider all of the evidence in the record. 
Specifically, the documents, including a HUD 1, in Exhibit O pertaining to the scheduled short sale
of the property were not discussed.  While the Board notes that not all the documents are signed, the
cumulative significance of the documents contained in the exhibit is sufficient such that the Judge
should have discussed the exhibit.  The case is remanded for the Judge to issue a new decision in
which she addresses Exhibit O.
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Order
The Decision is REMANDED.  
Signed: Michael Ra’anan          
Michael Ra’anan
Administrative Judge
Chairperson, Appeal Board
Signed: Jeffrey D. Billett          
Jeffrey D. Billett
Administrative Judge
Member, Appeal Board
Dissenting Opinion of Administrative Judge James E. Moody
I disagree with my colleagues.  Whether or not it would have been preferable for the Judge
to have discussed Exhibit O, the exhibit does not, on its face, refute or undermine anything in her
Decision.  The Judge acknowledged that Applicant had a pending contract for the sale of the
property in question but also noted that other attempted short sales had fallen through over the years. 
The exhibit states that closing had to occur by December 28, 2015, and there is nothing in the record
to show that this was done.  I would affirm the Judge’s decision. 
Signed: James E. Moody          
James E. Moody
Administrative Judge
Member, Appeal Board
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