1 
 
 
 
               DEPARTMENT OF DEFENSE 
     DEFENSE OFFICE OF HEARINGS AND APPEALS 
 
 
 
 
In the matter of:  ) 
 ) 
  REDACTED   )   ISCR Case No. 15-02609 
   ) 
Applicant for Security Clearance  ) 
 
 
Appearances 
 
For Government: Carroll J. Connelley, Esq., Department Counsel 
For Applicant: Pro se 
 
 
______________ 
 
Decision 
______________ 
 
 
MATCHINSKI, Elizabeth M., Administrative Judge: 
 
Applicant became seriously delinquent on some credit card debts when his spouse 
was unemployed for about a year. He exhausted his savings in paying for treatment for his 
daughter and could not pay his mounting credit card debt. Applicant still owes 
approximately $12,528 in delinquent balances, but he has made sufficient progress toward 
resolving his past-due debts to continue his security clearance eligibility. Clearance is 
granted. 
 
Statement of the Case 
 
 On November 12, 2015, the Department of Defense Consolidated Adjudications 
Facility (DOD CAF) issued a Statement of Reasons (SOR) to Applicant, detailing the 
security concerns under Guideline F, financial considerations, and explaining why it was 
unable to find it clearly consistent with the national interest to grant or continue security 
clearance eligibility for him. The DOD CAF took the action 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 for 
 
2 
 
Determining Eligibility for Access to Classified Information (AG) effective within the DOD on 
September 1, 2006. 
 
On December 21, 2015, Applicant answered the SOR allegations and requested a 
hearing before an administrative judge from the Defense Office of Hearings and Appeals 
(DOHA). On April 20, 2016, the case was assigned to me to conduct a hearing to 
determine whether it is clearly consistent with the national interest to grant or continue a 
security clearance for Applicant. On April 22, 2016, I scheduled a hearing for May 17, 
2016. 
 
I convened the hearing as scheduled. Four Government exhibits (GEs 1-4) and 
eight Applicant exhibits (AEs A-H) were admitted into evidence without objection. A letter 
forwarding discovery of the Government’s exhibits was marked as Hearing Exhibit (HE) 1 
for the record, but was not admitted as an evidentiary exhibit. Records submitted by 
Applicant as attachments to his answer were considered part of the pleadings and not 
admitted as evidentiary exhibits on Applicant’s representation that he did not intend to offer 
them because he had updated records.  Applicant testified, as reflected in a transcript (Tr.) 
received on May 27, 2016. 
 
I held the record open for one month after the hearing for Applicant to submit 
additional documentary evidence. On June 14, 2016, Applicant submitted two documents, 
which were accepted into the record without objection as AEs I and J. 
 
Summary of Pleadings 
 
 The SOR alleges under Guideline F that Applicant owed collection debt totaling 
$13,193 on five accounts (SOR ¶¶ 1.a-1.d and 1.h) and charged-off balances totaling 
$24,089 on three accounts (SOR ¶¶ 1.e-1.g) as of November 15, 2015. Applicant provided 
a detailed Answer to the SOR allegations, explaining that he had fallen behind on some 
financial obligations “several years back,” but not to the extent of living beyond his means. 
Applicant admitted only the debt in SOR ¶ 1.a, and indicated that he had begun making 
payments of $235 per month on the debt. Applicant denied that he owed a balance of 
$2,173 on the account in SOR ¶ 1.b in that he had been paying $100 a week to reduce the 
balance to $1,265. He denied the debts in SOR ¶¶ 1.c and 1.d because he had paid them. 
Applicant denied the debt in SOR ¶ 1.e because it was a duplicate listing of the debt in 
SOR ¶ 1.b. As for the $9,962 debt in SOR ¶ 1.g, Applicant explained that it had been sold 
with the balance reflected in SOR ¶ 1.g and has since been paid in full. Applicant also 
denied owing a $4,628 debt to an unnamed collection entity as alleged in SOR ¶ 1.h. He 
could find no record of the debt. 
 
Findings of Fact 
 
 After considering the pleadings, exhibits, and transcript, I make the following 
findings of fact. 
 
3 
 
Applicant is a 48-year-old electrician with one semester of community college 
studies. (Tr. 13.) Since November 2002, Applicant has worked full time for a research 
laboratory that has contracts with the DOD. (Tr. 33-34.) Applicant has also been self-
employed part time as an electrician since June 2002. (GE 1; Tr. 29, 34-35.) Applicant 
seeks to retain a secret clearance that was granted to him around January 2003. (GEs 1-2; 
Tr. 34.) 
 
Applicant and his spouse married in March 1995. They have two sons now ages 19 
and 21. His spouse has a daughter and a son from a previous marriage. Applicant’s 
stepchildren are now 30 and 27 and were raised by Applicant and his spouse. (GE 1.) 
 
Financial 
 
 Applicant and his spouse have lived in their present residence since approximately 
May 1996. Applicant bought the home from his mother for $190,000. (GE 1; Tr. 51-52.) 
Applicant borrowed against the equity in his home, initially to replace the roof, tie into the 
municipal water system, and repair water damage. (Tr. 52-54.) His mortgage debt 
increased from $203,000 in November 1999, to $250,000 in November 2001, and to 
$300,000 in March 2004. In September 2005, Applicant took on a $350,000 primary 
mortgage. In August 2007, Applicant and his spouse obtained a second mortgage for 
$45,000 to add a porch and to replace the siding and some windows. (GEs 3, 4; Tr. 54, 
100.) 
 
 In July 2006, Applicant obtained a loan of $10,000 to cover the tuition costs for his 
stepdaughter’s nursing school education. He made timely payments and the loan was 
repaid in full in September 2012. (GE 3; Tr. 102.) 
 
 Around 2009, Applicant began to struggle financially. (GE 2.) His spouse had 
worked as a waitress at the same establishment for several years, and she left the job 
because she was not earning enough income. (Tr. 28.) She was unemployed for about a 
year. (GE 2.) In addition, Applicant and his spouse exhausted their savings helping their 
daughter recover from a drug problem between 2009 and 2012. (Tr. 36.) Applicant’s 
daughter was initially placed for rehabilitation in a state-run program that was covered by 
his health insurance. In either 2009 or 2010, Applicant paid for two weeks of rehabilitation 
for his daughter in a private program that cost him approximately $20,000, which was not 
covered by his insurance. (Tr. 37-38.) He borrowed $15,000 from his parents to cover part 
of the cost. (Tr. 39.) 
 
 Applicant fell behind on his payments for his primary mortgage. In December 2009, 
his mortgage payment was over 120 days past due. (GE 3.) In May 2010, Applicant and his 
family took a week-long vacation that cost $5,000. Applicant’s in-laws covered a portion of 
the cost. (Tr. 70.) 
 
Between 2010 and 2012, Applicant’s income suffered because of a loss of overtime 
availability.  (Tr. 29, 69.) With limited exception, he made his mortgage payments on terms 
acceptable to his lender since March 2011. According to Applicant, his lender told him to 
4 
 
withhold three months of payments to qualify for refinancing. (Tr. 56.) In November 2012, 
Applicant transferred his mortgage of $350,000 to a new lender. (GEs 2, 3.) His monthly 
mortgage payment became $2,033. (GE 3.)  
 
On October 26, 2012, Applicant certified to the accuracy of a Questionnaire for 
National Security Positions (SF 86) incorporated within an Electronic Questionnaire for 
Investigations Processing. In response to inquiries concerning any delinquency involving 
routine accounts, Applicant listed six delinquent debts of $2,658 (SOR ¶ 1.e), $4,628 (SOR 
¶ 1.h), $5,248 (SOR ¶ 1.a),
1
 $13,208 (SOR ¶ 1.g), $403 (SOR ¶ 1.d), and $269 (not 
alleged in SOR). Applicant cited unspecified economic conditions as the reason for his 
inability to keep up with his payments. Applicant indicated that he was making payments 
under a payment plan to resolve the debts in SOR ¶ 1.a, 1.e, 1.f, and 1.h, and that in 
October 2012, he resolved both the disputed cable debt in SOR ¶ 1.d and the $269 in early 
termination charges on another cable television services account. (GE 1.)  
 
A check of Applicant’s credit on November 2, 2012, confirmed the outstanding 
delinquencies in SOR ¶¶ 1.a, 1.c, 1.g, and 1.h. The creditor in SOR ¶ 1.e was reporting a 
zero balance after sale of the debt to the collection entity in SOR ¶ 1.b.  A credit card 
account, on which Applicant was an authorized user, was in collection for $9,962 (SOR ¶ 
1.f).
2
 Applicant was making timely payments on two credit cards with balances of $16,902 
and $6,456 and on his second mortgage, which had a balance of $34,064. (GE 4.) The 
larger of the credit card balances was incurred for purchases on the Internet. (Tr. 101-102.) 
 
 On December 3, 2012, Applicant was interviewed by an authorized investigator for 
the Office of Personnel Management (OPM). Applicant indicated that he was awaiting a 
response from the collection entity about a repayment plan for the $2,658 credit card 
delinquency (SOR ¶¶ 1.b and 1.e, same debt). About the debt in SOR ¶ 1.h, Applicant was 
unable to verify the balance, but he indicated that he had offered to pay $25 a month 
toward the collection debt. Applicant did not recognize the collection company in SOR ¶ 1.a 
and could not recall the original creditor. As for the debt in SOR ¶ 1.g, Applicant contacted 
the collection entity now holding that debt and arranged to repay the debt at $100 a week. 
About the $403 debt (SOR ¶ 1.d), Applicant explained that he terminated his cable 
television service after technicians could not fix an ongoing problem. The company 
charged him an early termination fee, which Applicant claimed had been “wiped out” in 
October 2012. The $269 debt (not alleged in the SOR) was a fee assessed by his 
                                                 
1
The debt appears to be a revolving charge debt on an account opened with a retailer in April 2008. His 
account was charged off and placed for collection for $5,130 in May 2010 with the collection entity in SOR ¶ 
1.a. (GE 4.) The collection entity obtained a $5,130 judgment in June 2011. (GE 3.) As of October 2012, the 
unpaid balance was $5,248. (GE 4.) 
 
2 
Applicant testified to his belief that the debts in SOR ¶ 1.f and ¶ 1.g pertained to the same account. (Tr. 25.) 
However, the evidence does not substantiate his belief. As of November 2012, Equifax was reporting that a 
MasterCard account opened in February 2006 was in collection with a balance of $11,858. There was a 
separate listing for a MasterCard account opened in December 2006 with a balance of $9,962. Applicant was 
listed as an authorized user on that account. Whether the debt in SOR ¶ 1.f is a duplicate listing or a separate 
account on which Applicant was an authorized user, the evidence does not establish that Applicant was 
contractually liable for two separate debts. 
 
5 
 
subsequent cable television provider. Applicant did not recognize a $740 credit card 
collection debt on his credit record (SOR 1.c), but he also acknowledged that he was not 
completely aware of all his credit card debt. Applicant attributed his financial problems to 
his spouse losing her job around 2009. After he and his spouse exhausted their savings, 
Applicant began to pay bills in alternate months, but his credit lenders increased his 
interest rates. Eventually, he could not make the monthly minimum payments on some 
accounts. Additionally, he and his spouse assumed responsibility for some of their 
children’s expenses when their children were unemployed.
3
 Applicant expressed an 
intention to satisfy his debts and restore his credit to good standing. (GE 2.) Applicant 
testified that he was already in the process of resolving some of his financial delinquencies 
as of his OPM interview. He used a credit counseling service for assistance in gaining 
some control over his financial situation. (Tr. 29.) 
 
 In May 2013, Applicant leased a vehicle for $10,165, to be repaid at $282 monthly. 
Applicant made timely payments on the auto lease to reduce its balance to $4,868 as of 
December 2014. He also made timely payments of $391 per month toward his secured 
loan obtained in August 2007 for $45,000. As of January 2015, the loan balance was 
$27,828. His monthly mortgage payment increased from $2,011 in 2014 to $2,033 effective 
January 2015. (AE E.) 
 
 As of February 2015, Applicant was paying $838 and $182 on two credit card 
accounts that were rated as current with respective balances of $16,763 and $7,287. 
Applicant had made progress toward addressing the debt in SOR ¶ 1.g, but other past-due 
accounts went unpaid because of limited funds. (Tr. 85.) By the time of his hearing in May 
2016, he had resolved some of his delinquent accounts, as follows. 
 
$5,248 collection debt (SOR ¶ 1.a) 
 
 Applicant incurred the credit card debt primarily for his electrician’s business. (Tr. 
72-73.) When Applicant answered the SOR, he indicated that he had agreed to make 
payments of $235 per month and planned to pay off the debt in 36 months. As of May 
2016, Applicant had no record of any payments, although he claimed to have made five or 
six payments. He acknowledged that he had not kept up with the monthly payments. (Tr. 
71-72.) The collection entity now holding the debt agreed to accept monthly payments of 
$200 after a $500 initial payment, which Applicant made on June 14, 2016. (AEs I, J.) Due 
to accrued interest at 12%, the debt balance was approximately $7,900 after his June 2016 
payment. (AE I.) 
 
$2,173 collection debt (SOR ¶ 1.b, same debt in SOR ¶ 1.e) 
 
 Applicant defaulted on the credit card account in 2009. (GE 3.) He entered into a 
repayment plan with the initial collection entity, which began automatic deductions from his 
checking account. Applicant stopped the withdrawal because his payments were not being 
credited. (Tr. 82-83.) In October 2013, the collection entity in SOR ¶ 1.b obtained a $2,458 
                                                 
3 
At his hearing, Applicant clarified that his largest issue was with his stepdaughter, who became involved with 
illegal drugs. It was a “huge financial setback,” and he spent his life savings for her rehabilitation. (Tr. 36.)  
6 
 
judgment for the debt in SOR ¶ 1.e.
4
 (GE 3; AE A.) Starting in September 2015, Applicant 
made $100 weekly payments to reduce the balance to $1,265 as of December 16, 2015. 
Applicant satisfied the debt with a final payment of $75 on March 11, 2016. (AEs A, B; Tr. 
78-79.) 
 
$741 collection debt (SOR ¶ 1.c) 
 
 On November 5, 2015, the collection entity offered to settle Applicant’s $740 credit 
card balance for a lump-sum payment of $556, or payments of $99 for six consecutive 
months, or payments of $52 for 12 consecutive months. Applicant paid $740 to fully satisfy 
the debt on December 15, 2015. (AE B.) Applicant chose not to settle his debt for less than 
its full balance because he wanted to repay what he had borrowed. (Tr. 30.) 
 
$403 collection debt (SOR ¶ 1.d) 
 
 Applicant terminated his cable television service prematurely when technicians could 
not fix a problem. He noticed the debt on his credit report, but he ignored it because he had 
been dissatisfied. (Tr. 86-87.) On May 16, 2016, Applicant paid $403 to resolve his 
disputed cable television debt. (AE C.) 
 
$11,858 charged-off credit card debt (SOR ¶ 1.g) 
 
 Available collection records show that a judgment action was brought against 
Applicant. (GE 3; AE D.) Available collection records show that the unpaid balance had 
accrued to $15,026 as of late October 2012 and that Applicant authorized the debit of $100 
a week from his bank account to resolve the debt. (AE D.) Applicant immediately began 
repaying the debt at $100 a week. (Tr. 89.) With a final payment of $226 in December 
2015, Applicant satisfied the debt. (AE D.) 
 
$4,628 collection debt (SOR ¶ 1.h) 
 
 Applicant defaulted on a $4,628 credit card debt that was placed for collection in 
May 2010. (GE 3; AE E.) Applicant listed the debt on his SF 86 in October 2012, and he 
indicated that he was repaying the debt under a repayment plan. (GE 1.) During his OPM 
interview, Applicant indicated that he offered to make $25 monthly payments to a collection 
entity. (GE 2.) Due to inadequate recordkeeping, Applicant did not recognize the debt when 
he answered the SOR or initially at his hearing. (Answer; Tr. 94-95.) He then claimed that 
he made some payments.
 
(Tr. 98-99.) After his hearing, Applicant learned that the credit 
card debt had been sold to another collection entity in 2012. Applicant arranged to repay 
the debt by an initial $200 payment followed by monthly payments of $100. Applicant paid 
$200 on June 13, 2016. (AEs I, J.) The debt does not appear on Applicant’s latest credit 
report (AE E), and Applicant did not provide its current balance. 
 
                                                 
4
 The $2,173 alleged in SOR ¶ 1.b appears to be the balance on the debt as of January 2015, after the 
collection entity obtained a $2,458 judgment. (GE 3.) 
7 
 
 In January 2016, Applicant‘s monthly mortgage obligation increased from $2,033 to 
$2,668. As of May 2016, Applicant was paying his mortgage on time. The balance of his 
mortgage was $297,046. He paid $601 in February 2016 to reduce the debt remaining on 
his auto lease to only $300. He paid off his auto lease before his hearing. (Tr. 28.) 
Applicant was making timely payments of $391 per month toward his second mortgage, 
which had a balance of $24,068. Applicant had two open credit card accounts on which he 
had balances of $16,869 and $10,425 as of April 2016. In recent years, the balance on the 
first account varied from a low of $16,763 in February 2015 to a high of $17,450 in July 
2015. As of February 2015, his scheduled monthly payment was $838. (GE 3.) Equifax 
was not reporting the amount of his monthly payments as of May 2016. The second 
account, which has a credit limit of $10,600, had a balance of $8,774 as recently as 
September 2015. Applicant’s scheduled monthly payment on the debt was $228. A dentist 
was reporting a $417 debt from 2012 in collection. (AE E.) 
 
 Applicant’s take-home pay from his full-time work is about $840 a week. (Tr. 51.) 
Applicant’s part-time income varies depending on the frequency of his contract work as an 
electrician. He was busy at the end of 2015, and for tax purposes, his business profit was 
close to $40,000 for 2015. He had “maybe six jobs” in the first five months of 2016. (Tr. 
35.) Applicant also plows snow, and during the winter of 2014-2015 he earned a 
considerable amount of money from plowing. In the winter of 2015-2016, funds earned 
from plowing were not enough to cover the gas costs. (Tr. 64.) 
 
 Applicant’s spouse is currently employed as a waitress, and her earnings are largely 
dependent on tips. Her average take-home income is $400 to $500 a week. (Tr. 62.) Three 
of Applicant’s adult children are still living at home, including his stepdaughter and her 
eight-year-old son. Applicant provides for their basic needs while also paying for his 
children’s cell phones. He pays $260 per month for cell phone service for the family, $300 
a month for his spouse’s car lease, and $160-$170 for Internet/cable services. (Tr. 40-42, 
61-62.) He estimated the family’s grocery bill at $200 a week. (Tr. 60.) Their water bill runs 
him about $100 a month. His electric bill averages $175 a month. His gas bill varies from 
$5 a month in the summer to $250 a month in the winter. (Tr. 59-60.) 
 
 In the fall of 2015, the older of Applicant’s two sons began studies at a community 
college. Applicant borrowed $7,000 to $8,000 from his 401(k) to pay for his son’s college. 
(Tr. 66-67.) His loan repayment is being automatically deducted from his wages at $27 a 
week. (Tr. 67.)  Midyear, Applicant’s son transferred to a state college which costs $30,000 
a year. Applicant paid that portion of his son’s tuition that was not waived, which amounted 
to four installments of $2,543. (Tr. 43-45.) Applicant’s younger son lives at home and works 
at a fitness center. (Tr. 46-47.) Both sons drive vehicles registered to Applicant, but they 
pay for their car insurance. (Tr. 47.)  Applicant’s children contribute financially to the 
household, although not in any set amount. (Tr. 63.) Applicant had $1,218 in his checking 
account as of June 13, 2016. (AE J.) 
 
 Applicant is known for his elaborate holiday lights display, which for the past few 
years has raised funds for charitable causes. (AE H.) He described his electric bill as 
“ridiculous” during the holiday season. (Tr. 60.) 
8 
 
References 
 
 An operations manager at work, who has supervised Applicant’s work performance 
for the past four years, attested to Applicant conducting himself “in an exemplary manner, 
often going above and beyond to insure client satisfaction in a demanding environment.” 
(AE F.) Another co-worker, who has known Applicant professionally and personally for 20 
years, observed Applicant to be hard working. He considers Applicant to be a valuable 
asset to his workplace and Applicant’s community. (AE G.)  
 
Policies 
 
The U.S. Supreme Court has recognized the substantial discretion the Executive 
Branch has in regulating access to information pertaining to national security,  emphasizing 
that “no one has a ‘right’ to a security clearance.” Department of the Navy v. Egan, 484 
U.S. 518, 528 (1988). When evaluating an applicant’s suitability for a security clearance, 
the administrative judge must consider the adjudicative guidelines. In addition to brief 
introductory explanations for each guideline, the adjudicative guidelines list potentially 
disqualifying conditions and mitigating conditions, which are required to be considered 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 overall 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. 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 applicant or proven by Department Counsel. . . .” The applicant 
has the ultimate burden of persuasion to obtain 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 
that the applicant may deliberately or inadvertently fail to safeguard classified information. 
Such decisions entail a certain degree of legally permissible extrapolation about 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 
9 
 
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 concerns about financial considerations are set forth 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. 
 
 In addition to his full-time position with a defense contractor, Applicant has his own 
part-time electrical contracting business. Yet, when Applicant applied to renew his security 
clearance eligibility in October 2012, he was seriously delinquent on five credit card 
accounts totaling approximately $28,300 (SOR ¶¶ 1.a-1.c, 1.g-1.h). In addition, he owed a 
$403 fee for terminating a cable television service contract prematurely (SOR ¶ d). Another 
credit card debt was in collection for $9,962 (SOR ¶ 1.f), but as an authorized user, 
Applicant was not contractually liable for repayment. A person’s relationship with his 
creditors is a private matter until evidence demonstrates an inability or unwillingness to 
repay debts under terms acceptable to creditors. While an applicant is not required to be 
debt free, he is required to manage his finances responsibly. Applicant’s record of financial 
delinquency establishes disqualifying conditions AG ¶ 19(a), “inability or unwillingness to 
satisfy debts,” and AG ¶ 19(c), “a history of not meeting financial obligations.” 
 
 Concerning mitigation of Applicant’s delinquent debts, AG ¶ 20(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,” cannot reasonably apply. Applicant began repaying the 
credit card debt in SOR ¶ 1.g at $100 a week in October 2012 in response to a judgment 
action, but his other past-due accounts went largely unaddressed until 2015. 
 
 Applicant attributes his financial problems to his spouse’s year of unemployment, to 
other expenses caring for their children, and to a decline in his overtime income. AG ¶ 
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,” is applicable to the extent that his and his spouse’s household 
finances were compromised by a loss of income and unexpected expenses. His spouse 
resigned from her job, but her income as a waitress was contingent on tips and she lacked 
sufficient work hours. Applicant did not have control over the decline in overtime at his job. 
10 
 
Applicant and his spouse assumed responsibility for some of their children’s obligations. 
He provided few specifics in that regard other than that he spent $20,000 for his 
stepdaughter’s drug rehabilitation. 
 
 However, the evidence also suggests a history by Applicant of taking on excessive 
debt in relation to his income, with the consequence that he was unable to make the 
monthly minimum payments on several of his credit card balances after his creditors raised 
his rate on unpaid balances. He borrowed against the equity in his home a few times for 
needed home improvements and other expenses, but by increasing his mortgage debt 
from $203,000 to its present $350,000, he also increased his monthly mortgage obligation. 
He added to his debt burden by taking on a $45,000 second mortgage with $391 monthly 
payments. He has high credit card balances close to his credit limit on two accounts. The 
balance on one account in recent years has ranged from a low of $16,763 in February 
2015 to a high of $17,450 in July 2015. As of April 2016, he owed $16,869 on that account 
and $10,431 on another credit card account. While both accounts are rated as current, 
they show his continued reliance on consumer credit for some purchases. When asked to 
explain his failure to make payments on collection debts for several years, Applicant 
admitted that he could not afford to make payments. 
 
 Mitigating conditions AG ¶ 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 AG ¶ 20(d), “the individual initiated a good-faith effort to repay overdue 
creditors or otherwise resolve debts,” have some applicability. Applicant made payments 
between September 2015 and March 2016 to fully satisfy the debt in SOR ¶ 1.b (same 
debt in SOR ¶ 1.e). On December 15, 2015, Applicant paid $740 to resolve the credit card 
delinquency in SOR ¶ 1.c. On May 16, 2016, he paid the disputed cable television debt in 
SOR ¶ 1.d. Although in response to a judgment action, Applicant made payments between 
October 2012 and December 2015 to fully resolve his $15,026 credit card delinquency 
(SOR ¶ 1.g). 
 
 After his security clearance hearing, Applicant contacted the collection entities for 
his two remaining delinquencies (SOR ¶ 1.a and ¶ 1.h). Applicant entered into repayment 
arrangements and made the initial payments required in June 2016. He is committed to 
making monthly payments of $200 toward the debt in SOR ¶ 1.a and $100 toward the debt 
in SOR ¶ 1.h. While he showed some good faith under AG ¶ 20(d) in establishing these 
arrangements, he has not yet demonstrated a sufficient record of recurring payments to 
apply AG ¶ 20(c) to the debts in SOR ¶ 1.a and ¶ 1.h. 
 
 Mitigating condition AG ¶ 20(e) applies to the debt in SOR ¶ 1.f in that Applicant is 
not contractually liable for repayment as an authorized user. It is also established with 
respect to the debt in SOR ¶ 1.e in that it is not an additional debt from the collection 
account in SOR ¶ 1.b. AG ¶ 20(e) provides: 
 
(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 
11 
 
proof to substantiate the basis of the dispute or provides evidence of actions 
to resolve the issue. 
 
 Assuming balances of approximately $4,628 (SOR ¶ 1.h) and $7,900 (SOR ¶ 1.a), 
Applicant owed outstanding delinquencies totaling $12,528 as of June 2016. The 
Government’s concerns about Applicant’s ability to sustain his promised payments of $100 
and $200 per month cannot be easily dismissed in light of Applicant’s recurring monthly 
obligations of approximately $6,000, including $2,668 for his primary mortgage, $391 for 
his second mortgage, $228 on the credit card with a $10,425 balance, $300 for his wife’s 
car lease, $160-$170 for Internet and cable services, $800 for groceries, $260 for cell 
phone service, utility costs (water, gas, electric) that total as much as $525 in the winter 
months, and his payment on his larger credit card debt. As of February 2015, his 
scheduled monthly payment was $838. He reported monthly take-home pay around $3,360 
from his full-time job and $1,600 to $2,000 for his spouse every four weeks, which 
suggests a tight financial situation. However, Applicant supplements the household income 
by snowplowing and taking electrician jobs. There is no evidence of recent credit card or 
mortgage delinquency that would raise doubts about his ability to maintain his promised 
payments. 
 
 The security clearance adjudication is not aimed at collecting an applicant’s 
personal debts. Rather, it involves an evaluation of an applicant’s judgment, reliability, and 
trustworthiness in light of the security guidelines in the Directive. See ISCR Case No. 09-
02160 (App. Bd. Jun. 21, 2010). In evaluating Guideline F cases, the Appeal Board has 
established that an applicant is not required to pay off every debt in the SOR: 
 
The Board has previously noted that the concept of a meaningful track 
record necessary includes evidence of actual debt reduction through 
payment of debts. However, an applicant is not required, as a matter of law, 
to establish that he has paid off each and every debt listed in the SOR. All 
that is required is that an applicant demonstrated that he has established a 
plan to resolve his financial problems and taken significant actions to 
implement that plan. The Judge can reasonably consider the entirety of an 
applicant’s financial situation and evaluating the extent to which that 
applicant’s plan for the reduction of his outstanding indebtedness is credible 
and realistic. There is no requirement that the plan provide for payments on 
all outstanding debts simultaneously. Rather, a reasonable plan (and 
concomitant conduct) may provide for the payments of such debts one at a 
time. Likewise, there is no requirement that the first debts actually paid in 
furtherance of a reasonable debt plan be the ones listed in the SOR. 
 
See ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008) (internal citations and 
quotation marks omitted). Applicant’s record of regular payments to resolve the debt in 
SOR ¶ 1.g augurs favorably for whether he can reasonably be expected to make the 
promised payments on his two remaining credit card delinquencies. While his financial 
budget is tight, he wants to pay those debts that he incurred, and he needs his full-time job 
to do so. While his decision to incur large electric bills for his holiday displays is a 
12 
 
questionable expense in light of his overall financial situation, Applicant does not live an 
extravagant lifestyle, and he is willing to earn extra income to cover his expenses. His 
recent loan from his 401(k) to pay for his son’s college is not a frivolous expense. He has 
made enough progress toward stabilizing his finances to mitigate the financial 
considerations security concerns. 
  
Whole-Person Concept 
 
Under the whole-person concept, the administrative judge must consider the totality 
of an applicant’s conduct and all relevant circumstances in light of the nine adjudicative 
process factors in AG ¶ 2(a).
5
 The analysis under Guideline F is incorporated in my whole-
person analysis. Some of the factors in AG ¶ 2(a) were addressed under that guideline, but 
some warrant additional comment. 
 
 Applicant admitted that he lost track of some of his consumer credit accounts after 
he could no longer afford to make the monthly minimum payments.  While he had some 
unexpected costs for his stepdaughter’s drug rehabilitation, his inattention to some of his 
financial obligations after the crisis had passed is inconsistent with the sound judgment 
expected of persons with classified access. Additionally, he lacks a record of consistent 
payments on two long-overdue credit card debts. However, he has been a valuable 
contributor for his defense contractor employer, and his full-time employment is important 
to his family’s financial stability. He is unlikely to jeopardize his job by engaging in any 
illegal acts to generate funds to address $12,528 in remaining delinquent debt. He has 
acted in a reasonable manner to address a good portion of his past-due debt. This conduct 
indicates that he will continue to address his obligations until they have been paid. It is this 
conduct in addressing his bills which gives me the confidence that he will make the 
payments necessary to resolve his remaining delinquencies. After considering all the facts 
and circumstances, I conclude that it is clearly consistent with the national interest to 
continue Applicant’s security clearance eligibility. 
 
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 
 
                                                 
5 
The factors under AG ¶ 2(a) are as follows: 
 
(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. 
 
13 
 
Subparagraphs 1.a-1.h:  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 continue Applicant’s eligibility for a security 
clearance. Eligibility for access to classified information is granted. 
 
 
_____________________ 
Elizabeth M. Matchinski 
Administrative Judge