DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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)       ISCR Case No. 14-06287
)
)
Applicant for Security Clearance )
Appearances
For Government: Andrea M. Corrales, Esquire, Department Counsel
For Applicant: Pro se
November 4, 2016
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Decision
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MOGUL, Martin H., Administrative Judge:
On November 13, 2015, the Department of Defense (DoD) issued a Statement of
Reasons (SOR) detailing the security concerns under Guideline F  for Applicant. (Item
1.) 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. 
 
On December 8, 2015, Applicant replied to the SOR (RSOR) in writing, and he
requested that his case be decided on the written record in lieu of a hearing. (Item 2.) 
On February 9, 2016, Department Counsel issued the Department's written case. On
February 10, 2016, a complete copy of the file of relevant material (FORM) was
provided to Applicant. In the FORM, Department Counsel offered nine documentary
exhibits. (Items 1-9.) Applicant was given the opportunity to file objections and submit
material in refutation, extenuation, or mitigation. A response was due on March 17,
2016. Applicant submitted five, one page character letters, identified and entered into
evidence without objection as Item A. The case was assigned to this Administrative
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Judge on May 11, 2016. Based upon a review of the pleadings and exhibits, eligibility
for access to classified information is denied.
Findings of Fact
After a complete and thorough review of the evidence in the record, including
Applicant's RSOR, and the FORM, and upon due consideration of that evidence, I make
the following findings of fact: 
Applicant is 41 years old. He was born in the Philippines. Applicant is married for
the second time. He attended community college. Applicant is employed by a defense
contractor, and he seeks a DoD security clearance in connection with his employment in
the defense sector. (Item 3.)
Guideline F, Financial Considerations
The SOR lists eight allegations (1.a. through 1.h.) regarding financial difficulties,
specifically the filing of two bankruptcies and delinquent debts, under Adjudicative
Guideline F. The allegations will be discussed below in the same order as they were
listed on the SOR:
1.a. It is alleged in the SOR that Applicant filed a Chapter 7 Bankruptcy in
November 2007, which was dismissed in 2008. Applicant admitted this SOR allegation
in his RSOR. He wrote that he filed the Chapter 7 Bankruptcy due to unexpected
medical expenses related to the pregnancy of his wife and third child, who was born in
June 2007, and from the medical bills of his mother-in-law. Applicant also filed
bankruptcy so that he could refinance his home mortgage.  Finally, Applicant wrote that
this bankruptcy was dismissed in 2008, because it was determined that he had the
means to make minimum payments toward his debt. (Item 2.) 
1.b. It is alleged in the SOR that Applicant filed a Chapter 13 Bankruptcy in
October 2013, with liabilities totaling $47,945 and assets totaling $44,628. This
bankruptcy was dismissed in April 2014. Applicant admitted this SOR allegation in his
RSOR. He wrote that he filed the Chapter 13 Bankruptcy at the advice of his bankruptcy
attorney as it would be the best way to consolidate all of his debts and properly manage
his debts. (Item 2.)
Items 5 and 6 include the Trustee’s Final Report and Account, which establishes
that Applicant’s Chapter 13 Bankruptcy was dismissed on April 30, 2014, for Applicant’s
failure to appear and testify at the regularly scheduled and duly noticed first meeting of
creditors. No claims were discharged in this Chapter 13 Bankruptcy. Applicant provided
no explanation for his failure to appear at the first meeting of creditors. 
1.c. This overdue debt is cited in the SOR for a delinquent account in the amount
of $9,999. Applicant admitted this SOR allegation in his RSOR. He wrote that this debt
was part of a debt consolidation filed under the Chapter 13 Bankruptcy. (Item 2.) As
reviewed in 1.b., above, no debts were discharged in this dismissed Chapter 13
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Bankruptcy. I find that no independent evidence has been introduced to establish that
this debt has been resolved or reduced. 
1.d. This overdue debt is cited in the SOR for a delinquent account in the amount
of $6,107. Applicant admitted this SOR allegation in his RSOR. He wrote that this debt
was part of debt consolidation filed under the Chapter 13 Bankruptcy. (Item 2.) I find
that this debt was not discharged in bankruptcy, and no independent evidence has been
introduced to establish that the debt has been resolved or reduced. 
1.e. This overdue debt is cited in the SOR for a delinquent account in the amount
of $3,745. Applicant admitted this SOR allegation in his RSOR. He wrote that this debt
was part of debt consolidation filed under the Chapter 13 Bankruptcy. (Item 2.) I find
that this debt was not discharged in bankruptcy, and no independent evidence has been
introduced to establish that the debt has been resolved or reduced. 
1.f. This overdue debt is cited in the SOR for a delinquent account in the amount
of $372. Applicant admitted this SOR allegation in his RSOR. He wrote that this debt
was part of debt consolidation filed under the Chapter 13 Bankruptcy. (Item 2.) I find
that this debt was not discharged in bankruptcy, and no independent evidence has been
introduced to establish that the debt has been resolved or reduced. 
1.g. This overdue debt is cited in the SOR for a delinquent medical account in the
amount of $229. Applicant admitted this SOR allegation in his RSOR. He wrote that this
medical debt should have been paid by his medical insurance company. He contended
that he has questioned his medical insurance company as to why this bill was not paid,
but has received no response. (Item 2.) No independent evidence has been introduced
to establish that the debt has been resolved or reduced. 
1.h. This overdue debt is cited in the SOR for a delinquent medical account in the
amount of $152. Applicant admitted this SOR allegation in his RSOR. He wrote that this
medical debt should also have been paid by his medical insurance company. He
contended that he has questioned his medical insurance company as to why this bill
was not paid, but has received no response. He indicated that he planned to make an
arrangement to pay the full amount of this debt. (Item 2.) No independent evidence has
been introduced to establish that the debt has been resolved or reduced. 
As reviewed above, Applicant submitted five Post-FORM character letters. (Item
A.) He was described in them as a “one of the most reliable employees,” and
“trustworthy and reliable.”
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.
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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 AG ¶ 2 describing the adjudicative process. The administrative judge’s
over-arching adjudicative goal is a fair, impartial and commonsense decision. 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.” 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 ¶ 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 the applicant or proven by Department Counsel. . . .” The
applicant has the ultimate burden of persuasion as to obtaining a favorable clearance
decision. 
A person who applies for access to classified information seeks to enter 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 adverse 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).
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Analysis
Guideline F, Financial Considerations
The security concern relating to the guideline for Financial Considerations is set
out in AG ¶ 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. 
The guideline notes several conditions that could raise security concerns and
could potentially apply in this case.  Under AG ¶ 19(a), “an inability or unwillingness to
satisfy debts,” is potentially disqualifying. Similarly under AG ¶ 19(c), “a history of not
meeting financial obligations” may raise security concerns. I find that both of these
disqualifying conditions apply to Applicant in this case. The evidence has established
that Applicant accumulated significant delinquent debt, much of it several years old,
which has not been satisfied. 
AG ¶ 20 provides conditions that could mitigate security concerns from financial
difficulties. Under AG ¶  20(b), it may be mitigating where, “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.” As
reviewed above, Applicant explained his financial difficulties occurred, in part, because
of the medical bills of his wife and daughter, and his mother-in-law. However, Applicant
has not been responsible in attempting to resolve the delinquent SOR debts. While he
initially attempted to use the legal means of bankruptcy to resolve the debts, he failed to
meet his legal responsibility to appear at the regularly scheduled and duly noticed first
meeting of creditors, resulting in the bankruptcy being dismissed without resolving any
of the overdue debts. Therefore, I find that this mitigating condition is not a factor for
consideration in this case.
Since there is no evidence that Applicant has initiated a good-faith effort to repay
any of the overdue creditors, I do not find that AG ¶ 20(d) is applicable. I also do not find
any other mitigating condition applies to this case. Finally, no evidence has been
introduced to establish that Applicant’s current financial situation is stable and secure.
Therefore, I find Guideline F against Applicant.
Whole-Person Concept
Under the whole-person concept, the administrative judge must evaluate an
applicant’s eligibility for a security clearance by considering the totality of the Applicant’s
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conduct and all the circumstances. The administrative judge should consider the nine
adjudicative process factors listed at AG ¶ 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.
Under AG ¶ 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.      
I considered the potentially disqualifying and mitigating conditions in light of all
the facts and circumstances surrounding this case. Based on all of the reasons cited
above as to why the disqualifying conditions apply and no mitigating conditions are
applicable, I find that the record evidence leaves me with significant questions and
doubts as to Applicant’s eligibility and suitability for a security clearance under the
whole-person concept. For all these reasons, I conclude Applicant has not mitigated the
security concerns under the whole-person concept. 
Formal Findings
Formal findings for or against Applicant on the allegations set forth in the SOR,
as required by ¶ E3.1.25 of Enclosure 3 of the Directive, are:
Paragraph 1, Guideline F: AGAINST APPLICANT
Subparagraphs 1.a. - 1.h.: Against  Applicant
Conclusion
In light of all of the circumstances presented by the record in this case, it is not
clearly consistent with the national interest to grant Applicant eligibility for a security
clearance. Eligibility for access to classified information is denied.
                                              
Martin H. Mogul
Administrative Judge
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