1
                                                             
                             DEPARTMENT OF DEFENSE
               DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
)
)       ISCR Case No. 15-02092
)
)
Applicant for Security Clearance )
Appearances
For Government: Andrew Henderson, Esquire, Department Counsel
For Applicant: Pro se
April 19, 2016
______________
Decision
______________
CEFOLA, Richard A., Administrative Judge:
Applicant submitted his Electronic Questionnaires for Investigations Processing
(e-QIP) on April 21, 2014.  On November 2, 2015, the Department of Defense (DOD)
issued a Statement of Reasons (SOR) detailing the security concerns under Guideline F
for Applicant.  The action was taken under Executive Order 10865, Safeguarding
Classified Information Within Industry (February 20, 1960), as amended; Department of
Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review
Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines
(AG), effective within the Department of Defense after September 1, 2006. 
Applicant acknowledged receipt of the SOR on November 13, 2015.  He
answered the SOR in writing that same date, and requested a hearing before an
Administrative Judge.  The Defense Office of Hearings and Appeals (DOHA) received
the request soon thereafter, and I received the case assignment on January 19, 2016.
DOHA issued a notice of hearing on January 26, 2016, and I convened the hearing as
scheduled on February 17, 2016.  The Government offered Exhibits (GXs) 1 through 4,
which were received without objection.  Applicant testified on his own behalf.  DOHA
2
received the transcript of the hearing (TR) on February 25, 2016.  I granted Applicant’s
request to keep the record open until March 17, 2016, to submit additional matters.  On
February 18, February 19, and March 3, 2016, he submitted Exhibits (AppXs) A~E,
which were received without objection.  The record closed on March 17, 2016.  Based
upon a review of the pleadings, exhibits, and testimony, eligibility for access to classified
information is granted.
Findings of Fact
In his Answer to the SOR, it is unclear if Applicant admitted or denied the two
factual allegations.  At his hearing, Applicant admitted the factual allegations
Subparagraphs 1.a. and 1.b. of the SOR, with explanations.
Guideline F - Financial Considerations
Applicant is a 38 year old former U.S. Marine, who seeks a security clearance in
conjunction with his employment.  (GX 1 at pages 5 and 15.)
1.a. and 1.b.  Applicant admits that, as a result of a foreclosure of his
“townhouse,” he was indebted to Creditor A for over $272,000 on a primary mortgage,
and was indebted to Creditor B for over $69,000 on a second mortgage.  (TR at page
19 line 11 to page 31 line 20.)  He purchased this townhouse with the hope of amassing
some equity; but when the housing market crashed, he defaulted on the mortgages and
the two loans were foreclosed by the holders of the mortgages.  (Id.)  Since the
foreclosure, Applicant has been provided with Internal Revenue Service (IRS) Forms
1099-A and 1099-C as to these loans, which indicate the debts have been cancelled by
the creditors.  As a result, Applicant owes nothing as to the two mortgage loans.  This is
also evidenced by a December 2015 credit report showing that these mortgage loans
are not past due.  (GX 4 at page 6 entries #16 and #17, and AppX A at pages 8~11.)  I
find Applicant has resolved these two mortgage loans.
Policies
When evaluating an applicant’s suitability for a security clearance, the
administrative judge must consider the adjudicative guidelines (AG).  In addition to brief
introductory explanations for each guideline, the adjudicative guidelines list potentially
disqualifying conditions and mitigating conditions, which are useful in evaluating an
applicant’s eligibility for access to classified information.
These guidelines are not inflexible rules of law.  Instead, recognizing the
complexities of human behavior, these guidelines are applied in conjunction with the
factors listed in the adjudicative process.  The administrative judge’s over-arching
adjudicative goal is a fair, impartial and commonsense decision.  According to AG
Paragraph 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
3
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.
Paragraph 2(b) requires that “[a]ny doubt concerning personnel being considered for
access to classified information will be resolved in favor of national security.”  In
reaching this decision, I have drawn only those conclusions that are reasonable, logical
and based on the evidence contained in the record.  Likewise, I have avoided drawing
inferences grounded on mere speculation or conjecture.
Under Directive Paragraph E3.1.14, the Government must present evidence to
establish controverted facts alleged in the SOR.  Under Directive Paragraph 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 as to obtaining a
favorable security decision.
A person who seeks access to classified information enters into a fiduciary
relationship with the Government predicated upon trust and confidence.  This
relationship transcends normal duty hours and endures throughout off-duty hours.  The
Government reposes a high degree of trust and confidence in individuals to whom it
grants access to classified information.  Decisions include, by necessity, consideration
of the possible risk the Applicant may deliberately or inadvertently fail to protect or
safeguard classified information.  Such decisions entail a certain degree of legally
permissible extrapolation as to potential, rather than actual, risk of compromise of
classified information.
Section 7 of Executive Order 10865 provides that decisions shall be “in terms of
the national interest and shall in no sense be a determination as to the loyalty of the
applicant concerned.”  See also EO 12968, Section 3.1(b) (listing multiple prerequisites
for access to classified or sensitive information).
Analysis
Guideline F - Financial Considerations
The security concern relating to the guideline for Financial Considerations is set
out in Paragraph 18:
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.
4
The guideline notes two conditions that could raise security concerns.  Under
Subparagraphs 19(a) and 19(c) an “inability or unwillingness to satisfy debts,” and “a
history of not meeting financial obligations.” may raise security concerns.  Applicant’s
mortgage loans were foreclosed upon by the lenders.  However, I find a countervailing
Mitigating Condition that is applicable here.  Under Subparagraph 20 (d), it may be
mitigating where “the individual initiated a good-faith effort to repay overdue creditors or
otherwise resolve debts.”  Applicant’s foreclosed mortgages were forgiven by the
mortgage holders and are resolved.  Financial Considerations is found for Applicant.
Under the whole-person concept, the administrative judge must evaluate an
applicant’s eligibility for a security clearance by considering the totality of Applicant’s
conduct and all the circumstances.  Under Paragraph 2(c), the ultimate determination of
whether to grant eligibility for a security clearance must be an overall commonsense
judgment based upon careful consideration of the guidelines and the whole-person
concept.
The administrative judge should also consider the nine adjudicative process
factors listed at AG Paragraph 2(a): 
(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.
I considered all of the evidence, including the potentially disqualifying and
mitigating conditions surrounding this case.  Applicant has offered eight letters of
recommendation (AppXs A and C~E), and numerous Certificates of Training (AppX B).
The record evidence leaves me without questions and doubts as to Applicant’s eligibility
and suitability for a security clearance.  For this reason, I conclude Applicant has
mitigated the security concerns arising from his Financial Considerations, under the
whole-person concept.
5
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. For Applicant
Subparagraph 1.b. For Applicant
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.
Richard A. Cefola
Administrative Judge