DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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                                                                      )                                                             
        ------------------------------------                   )      ISCR  Case No.  15-00215           
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Applicant for Security Clearance )
Appearances
For Government: Eric Borgstrom, Esq., Department Counsel
For Applicant: Pro se  
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 Decision
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WESLEY, Roger C., Administrative Judge:
Based upon a review of the pleadings, exhibits, and testimony, I conclude that
Applicant mitigated the security concerns regarding her financial considerations, but did
not mitigate personal conduct concerns.  Eligibility for access to classified information is
denied. 
 
Statement of Case
On July 16, 2015, the Department of Defense (DoD) Consolidated Adjudications
Facility (CAF) issued a Statement of Reasons (SOR) detailing reasons why DoD
adjudicators could not make the affirmative determination of eligibility for a security
clearance, and recommended referral to an administrative judge to determine whether a
security clearance should be granted, continued, denied, or revoked. 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 (AGs) implemented by DoD on September
1, 2006.  
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Applicant responded to the SOR on August 18, 2015, and requested a hearing.
The case was assigned to me on October 6, 2015, and was scheduled for hearing on
November 17, 2015. At hearing, the Government's case consisted of seven exhibits (GEs
1-7). Applicant relied on one witness (herself) and ten exhibits (AEs A-J). The transcript
(Tr.) was received on November 25, 2015. 
Procedural Issues
Before the close of the hearing, Applicant requested the record be kept open to
permit her the opportunity to supplement the record with documented payments of debts
owed to creditor 1.j and creditors 1.l-1.p. For good cause shown, Applicant was granted
14 days to supplement the record. The Government was afforded 12 days to respond. 
Within the time permitted to supplement the record, Applicant provided
documentation of the following: a letter from Applicant explaining several of her open
accounts, endorsements, an inquiry response and check payments from her debt
consolidation lender, payable to Applicant; a letter from a collection agency covering
creditor 1.e; a letter from a collection agency covering creditor 1.f; a letter from a
collection agency covering creditor 1.g; a letter from a collection agency, with attached
checks, covering creditor 1.m; a personal financial budget; and a letter from a collection
agency acknowledging payments to creditor 1.p. Applicant’s post-hearing submissions
were admitted as AEs K-S.  
Summary of Pleadings
Under Guideline F, Applicant allegedly accumulated 16 delinquent debts
exceeding $10,500. Allegedly, all of the debts remain outstanding. 
Under Guideline E, Applicant allegedly falsified her September 12, 2012, Electronic
Questionnaire for Investigation Processing (e-QIP), when she failed to disclose her
delinquent accounts listed in subparagraphs 1.a through 1.p of the SOR. Allegedly,
Applicant was aware of these accounts when she completed her 2012 e-QIP. 
In her response to the SOR, Applicant admitted each of the listed debts. She
claimed she established a debt consolidation agreement and paid in full the debts
covered by subparagraphs 1.a through 1.h, using loan money from her debt consolidation
lender.  She claimed she is still researching debts listed for creditors 1.i and 1.k. She
claimed she made a partial payment to creditor 1.j from debt consolidation loan funds and
made payment arrangements for the remaining balance of $100 a month. She claimed
she paid off the listed debts owed to creditors 1.l through 1.o. And she claimed she
applied to creditor 1.p for payment arrangements of $100 a month.
Addressing the personal conduct claims of the SOR, Applicant admitted her
omissions but denied any intention to provide false information. She claimed she was
aware of her debts but believed her debts did not become delinquent within the past
seven years. And she claimed she answered all of the questions in her e-QIP to the best
of her knowledge.
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Findings of Fact       
Applicant is a 43 year-old business operations analyst for a defense contractor
who seeks a security clearance. The allegations covered in the SOR were denied by
Applicant and placed in issue.  Findings follow.
Background
Applicant married in August 2004 and divorced her husband in September 2007.
(GEs 1 and 2; Tr. 34-35) She has two children from prior relationships (ages 27 and 26)
and three grandchildren. (Tr. 122) She claimed no education credits within the past ten
years, and claimed no military service. (GEs 1 and 2)
Applicant has worked for her current employer since 2011 as a business
operations analyst. (GEs 1 and 2)  Previously, she was employed by a non-defense
contractor as a support analyst between June 2010 and October 2011. She worked for a
defense contractor as a supply clerk between August 2006 and June 2010. (GEs 1 and 2)
Between January 2006 and August 2006, Applicant was unemployed. (GE 1) She
worked as a warehouse shipper for a non-defense contractor between December 2001
and January 2006. (GEs 1 and 2; Tr. 28-29) Since August 2006, she has had no breaks
in employment. (GEs 1 and 2; Tr. 25) 
Applicant’s finances
Applicant accumulated 16 delinquent debts between 2007 and 2013.  Altogether,
she accrued delinquent debts exceeding $10,400. (GEs 3-7) She enjoyed full
employment during this time frame, except for a brief period of unemployment in 2006
and cannot fully account for why she became delinquent with her accounts, or why she
failed to take any actions on her debts until 2015. (GE 3; Tr. 52-56) 
Applicant attributed most of her delinquent debts to medical issues associated with
her son’s outpatient surgery in 2008. (GE 3; Tr. 36-37)  While she had medical insurance
at the time, her insurance carrier did not pay the full amount of her claims and left her with
$900 worth of medical co-pays and other bills. (GE 3; Tr. 36-37, 89-90) 
In November 2015, Applicant completed a consolidated loan agreement with a
debt consolidation firm. (AEs A and F; Tr. 51-53) With loan funds from her debt
consolidation firm ($2,900 in total), she has addressed her listed debts. She documented
paying off most of her listed delinquent debts with loan funds disbursed from her lender.
(AEs A and G-H; Tr. 98-101) Her exhibits reveal payoffs of debts owed to creditors 1.a
($492) (AEs A and H); creditor 1.b ($371) (AEs A, G, and M); creditors 1.c and 1.h ($274
and $271, respectively) (AEs A and M); creditor 1.d ($243) (AEs A and M); creditor 1.e
($178) (AEs A and N); creditor 1.f ($159) (AEs A and P); creditor 1.j ($1,157) (AEs D and
Q); and creditors 1.l-1.o ($559). (AEs A and E) For hearing coverage of all of Applicant’s
addressed debts, see Tr. 58-103, and 127.
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Applicant assured that she has satisfied her creditor 1.p debt ($3,959) through her
consolidated debt payment arrangement, but could not document her payments. Afforded
a post-hearing opportunity to document her creditor 1.p payments, she validated her
payment arrangement with creditor 1.p and her three $100 payments to the creditor with
post-hearing documentation. (AE S) She continues to dispute her creditor 1.i ($1,726)
and 1.k ($85) debts. (Tr. 88)
Applicant filed her 2014 taxes and received a $1,900 refund in 2015. (Tr. 103) She
is current on her federal and state tax filings. (Tr. 104) She grosses $50,000 a year and
nets $2,700 a month. (GE 3 and AE R; Tr. 24) Applicant reports monthly expenses of
around $1,608, which leaves her with a monthly remainder of about $600 based on the
information she provided. (GE 3 and AE Q; Tr. 112) 
Applicant’s E-QIP omissions
Asked to complete an e-QIP in July 2010, Applicant omitted all of her delinquent
debts covered in her credit reports and listed in the SOR. (GEs 1-7) She acknowledged
omitting her debts, notwithstanding that she knew at the time she had delinquent debts,
even if she could not identify them by name. (Tr. 42-45) In a follow-up interview with an
agent from the Office of Personnel Management (OPM) in August 2010, she initially
answered “no” to the inquiring OPM agent’s inquiries about any delinquent debts
accumulated by Applicant. (GEs 2 and 3) Only after she was confronted by the agent did
she acknowledge her delinquent accounts. (GE 3)
In September 2012, Applicant was again asked to complete an e-QIP. (GE 1) This
time she answered “no” to questions inquiring about her delinquent accounts without any
included comments.  When asked whether she had delinquent accounts to report in her
follow-up OPM interview in November 2012, she again answered “no” to the agent’s
inquiries. (GE 3; Tr. 42-43) Afforded an opportunity at hearing to clarify her multiple
omissions of her delinquent debts, she acknowledged her awareness of her delinquent
debts and could not explain why she omitted them from both questionnaires and follow-up
OPM interviews. (Tr. 42-50) 
Considering all of the circumstances surrounding Applicant’s multiple omissions of
her delinquent debts in two e-QIPs and ensuing OPM interviews in 2010 and 2012,
respectively, Applicant’s explanations cannot be reconciled with her repeated omissions.
Inferences of knowing and wilful omission cannot be averted. 
Endorsements
Applicant is well-regarded by her manager who has known and worked with
Applicant for over four years and values her contributions. (AE I) She credited Applicant
with the performance of multiple functions within their organization and trusts her with
fulfilling her responsibilities. Applicant’s manager characterized Applicant as very detail
oriented, accountable, and one who maintains a great working relationship with her
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customers. Her manager credited Applicant with doing everything asked of her, and more
if needed. (AE I) She expressed her pleasure to have Applicant on their team her and
held high expectations for Applicant’s continued demonstration of excellence in her work
within the organization’s business operations branch. (AE I) 
Colleagues and friends are equally praiseworthy of Applicant. (AE L) They
describe her as hard working and highly responsible and dedicated to meeting her
customers’ neds. (AE L)
Applicant’s endorsements do not include any awards from her employer
recognizing her company contributions. (Tr. 122) Outside of work, she spends most of her
time with her children and grandchildren, which leaves her with little time to devote to
community and civic activities. (Tr. 122) 
Policies
           The AGs list guidelines to be used by administrative judges in the decision-making
process covering security clearance cases. These guidelines take into account factors
that could create a potential conflict of interest for the individual applicant, as well as
considerations that could affect the individual’s reliability, trustworthiness, and ability to
protect classified information. These guidelines include "[c]onditions that could raise a
security concern and may be disqualifying” (disqualifying conditions), if any, and many of
the "[c]onditions that could mitigate security concerns.”  Each of these conditions must be
considered before deciding whether or not a security clearance should be granted,
continued, or denied. The guidelines do not require administrative judges to place
exclusive reliance on the enumerated disqualifying and mitigating conditions in the
guidelines in arriving at a decision. Each of the guidelines is to be evaluated in the context
of the whole person in accordance with AG ¶ 2(c)
In addition to the relevant AGs, administrative judges must take into account the
pertinent considerations for assessing extenuation and mitigation set forth in AG ¶ 2(a) of
the AGs, which are intended to assist the judges in reaching a fair and impartial
commonsense decision based upon a careful consideration of the pertinent guidelines
within the context of the whole person. 
The adjudicative process is designed to examine a sufficient period of an
applicant’s life to enable predictive judgments to be made about whether the applicant is
an acceptable security risk. The following AG ¶ 2(a) factors are pertinent: (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 chances; (7) the motivation for the conduct; (8) the potential for
pressure, coercion, exploitation, or duress; and (9) the likelihood of continuation or
recurrence.
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 Viewing the issues raised and evidence as a whole, the following individual
guidelines are pertinent in this case:
Financial Considerations
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 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.  Compulsive gambling is a concern as it may lead to financial
crimes including espionage.  Affluence that cannot be explained by known
sources of income is also a security concern.  It may indicate proceeds
from financially profitable criminal acts.  AG ¶ 18.
Personal Conduct
The Concern : Conduct involving questionable judgment,
untrustworthiness, unreliability, lack of candor, dishonesty, or
unwillingness to comply with rules and regulations can raise questions
about an individual’s reliability, trustworthiness and ability to protect
classified information.  Of special interest is any failure to provide truthful
and candid answers during the security clearance process or any other
failure to cooperate with the security clearance process.  AG, ¶ 15.
Burden of Proof
By virtue of the principles and policies framed by the AGs, a decision to grant or
continue an applicant's security clearance may be made only upon a threshold finding
that to do so is clearly consistent with the national interest.  Because the Directive
requires administrative judges to make a commonsense appraisal of the evidence
accumulated in the record, the ultimate determination of an applicant's eligibility for a
security clearance depends, in large part, on the relevance and materiality of that
evidence. See United States, v. Gaudin, 515 U.S. 506, 509-511 (1995).  As with all
adversarial proceedings, the judge may draw only those inferences which have a
reasonable and logical basis from the evidence of record.  Conversely, the judge cannot
draw factual inferences that are grounded on speculation or conjecture.
The Government's initial burden is twofold: (1) it must prove by substantial
evidence any controverted facts alleged in the SOR, and (2) it must demonstrate that
the facts proven have a material bearing to the applicant's eligibility to obtain or maintain
a security clearance. The required materiality showing, however, does not require the
Government to affirmatively demonstrate that the applicant has actually mishandled or
abused classified information before it can deny or revoke a security clearance. Rather,
 W hile Applicant’s SOR does not allege falsification of her 2010 e-QIP, the e-QIP was admitted free of1
any Applicant objections and may be used to evaluate Applicant’s evidence of extenuation  and credibility,
and to complete a whole-person analysis.  See ISCR Case No. 03-20327 at 4 (App. Bd. Oct. 26, 2006).
Evidence of pattern e-QIP omissions is relevant in assessing Applicant’s overall honesty and state of mind
in failing to disclose her delinquent debts on four separate occasions. (Tr. 131-132)
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the judge must consider and weigh the cognizable risks that an applicant may
deliberately or inadvertently fail to safeguard classified information.
Once the Government meets its initial burden of proof of establishing admitted or
controverted facts, the evidentiary burden shifts to the applicant for the purpose of
establishing his or her security worthiness through evidence of refutation, extenuation,
or mitigation.  Based on the requirement of  Exec. Or. 10865 that all security clearances
be clearly consistent with the national interest, the applicant has the ultimate burden of
demonstrating his or her clearance eligibility. “[S]ecurity-clearance determinations
should err, if they must, on the side of denials.” See Department of the Navy v. Egan,
484 U.S. 518, 531 (1988). 
Analysis  
Security concerns are raised over Applicant’s history of delinquent debts that
Applicant accumulated between 2007 and 2013 and were not addressed until several
months after she received the SOR in July 2015. Security concerns are also raised over
Applicant’s recurrent omissions of her delinquent debts in the two e-QIPs she
completed in 2010 and 2012, respectively, and in the OPM interviews that followed
each e-QIP submission. 1
Financial considerations
Of the listed debts covered in the SOR, Applicant admitted all but two of the
debts (creditors 1.i and 1.k), which she surmised were associated with her son’s
surgery, but could not be sure. Based on the reported information supplied by Applicant
and the credit reporting agencies, the evidence is sufficient to presumptively warrant the
application of two of the disqualifying conditions (DC) of the Guidelines: DC ¶ 19(a),
“inability or unwillingness to satisfy debts,” and DC ¶ 19(c) “a history of not meeting
financial obligations.”
Holding a security clearance involves the exercise of important fiducial
responsibilities, among which is the expectancy of consistent trust and candor.
Financial stability in a person cleared to access classified information is required
precisely to inspire trust and confidence in the holder of the clearance. While the
principal concern of a clearance holder’s demonstrated financial difficulties is
vulnerability to coercion and influence, judgment and trust concerns are also explicit in
financial cases.
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Applicant’s delinquent debts were reported in a series of credit reports issued
between July 2010 and July 2014. (GEs 4-6)  Credit reports do create presumptions of
authenticity and accuracy. The Appeal Board has explained that credit reports can
“normally meet the substantial evidence standard and the government’s obligations
under [Directive] ¶ E3.1.14 for pertinent allegations.” ISCR Case No. 08-12184 at 7
(App. Bd. Jan. 7, 2010).  With the exception of the two debts (creditors 1.i and 1.k) that
Applicant disputes, none of the listed debts are challenged.
Applicant has since addressed her listed delinquent debts and documented
payoffs of most of the debts and payment plans with two of the creditors 1.j and 1.p. To
be sure, she has not presented sufficient evidence of extenuating circumstances to
entitle her to more than partial application  of MC  ¶ 20(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.” Based on
her recent repayment efforts, she merit application of two mitigating conditions: MC ¶
20(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 MC ¶
20(d), “the individual has initiated a good-faith effort to repay overdue creditors or
otherwise resolve debts.” 
Two of the listed debts in the SOR (creditors 1.i and 1.k) are disputed by
Applicant. Based on Applicant’s credible showing of good-faith in her questioning of the
validity of the two debts, she meets the probative requirements for establishing a
reasonable basis for her disputes. On the strength of the evidence presented, Applicant
is entitled to the application of MC ¶ 20(e), “the individual has a reasonable basis to
dispute the legitimacy of the past-due debt [debts] 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.” Applicant’s evidence is probative of her
disputes of the debts reported to be delinquent by creditors 1.i and 1.k and reflect
satisfactory debt resolution in accordance with the criteria established by the Appeal
Board for assessing an applicant’s efforts to rectify her reported poor financial condition
with responsible efforts considering his circumstances. See ISCR Case No. 08-06567 at
2-3 (App. Bd. Oct. 29, 2009). 
From a whole-person standpoint, Applicant documents a meritorious record of
civilian employment with her defense contractor employer. She has demonstrated
impressive support from her business operations manager, colleagues, and friends who
credit her with responsible and trusted performance with her business operations
department. Addressing her finances, while late in paying them, Applicant has paid or
otherwise resolved her listed debt, except for the two debts she disputes. Favorable
conclusions are warranted with respect to the allegations covered by Guideline F.
Personal Conduct concerns
Security concerns are raised as well over Applicant’s failure to list her delinquent
debts in her 2012 security clearance application.  Such concerns are raised when an
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applicant has committed conduct that reflects questionable judgment, lack of candor,
dishonesty, or unwillingness to comply with rules and regulations.
Looking at the developed facts and circumstances in this case, two of the
disqualifying conditions (DC) under the personal conduct guideline apply to Applicant’s
situation. DC ¶ 16(a), “deliberate omission, concealment, or falsification of relevant facts
to any personnel security questionnaire, personal history statement, or similar form
used to conduct investigations, determine employment qualifications, award benefits or
status, determine security clearance eligibility or trustworthiness, or award fiduciary
responsibilities,” and DC ¶ 16(b), “deliberately providing false or misleading information
concerning relevant facts to an employer, investigator, security official, competent
medical authority, or other official government representative.” DC ¶ 16(a) applies  to
Applicant’s 2012 e-QIP omissions; DC ¶ 16(b) applies to her 2012 OPM interviews. 
Under the facts and circumstances of this case, Applicant’s omissions of her
listed debts are difficult to reconcile with her claims of uncertainty over whether her
debts required disclosure in either her 2010 e-QIP or more recent 2012 e-QIP. Afforded
an opportunity to correct her omissions in her follow-up OPM interviews in 2010 and
2012, respectively, she failed to provide any evidence of voluntary corrections before
she was confronted with her listed delinquent accounts by the interviewing agents.
Considering all of the circumstances, Applicant is not entitled to any of the benefits of
the mitigating conditions of Guideline E. 
From a whole-person perspective, Appellant’s overall efforts are not sufficient to
mitigate questions about her demonstrated honesty and integrity arising from her e-QIP
omissions and ensuing OPM interviews before she was confronted. Unfavorable
conclusions are warranted re: the allegations covered by Guideline E.  
Formal Findings
In reviewing the allegations of the SOR and ensuing conclusions reached in the
context of the findings of fact, conclusions, conditions, and the factors listed above, I
make the following formal findings:
GUIDELINE F (FINANCIAL CONSIDERATIONS):   FOR APPLICANT
Subparas. 1.a-1.p:                        For Applicant
GUIDELINE E (PERSONAL CONDUCT):       AGAINST APPLICANT
Subpara. 2.a:      Against Applicant
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                        Conclusio  n  s    
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 Applicant’s security
clearance.  Clearance is denied.
                                          
Roger C. Wesley
Administrative Judge 
                                        
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