1 
   DEPARTMENT OF DEFENSE 
     DEFENSE OFFICE OF HEARINGS AND APPEALS 
In the matter of:  ) 
 ) 
Redacted  ) ISCR Case No. 14-06410 
 ) 
Applicant for Security Clearance  ) 
Appearances 
For Government: David F. Hayes, Esq., Department Counsel 
For Applicant: Randall E. Wilbert, Esq. 
______________ 
Decision 
______________ 
MATCHINSKI, Elizabeth M., Administrative Judge: 
Applicant used credit cards to start a business that suffered from a downturn starting 
in 2009. His financial problems were exacerbated by the loss of rental income in 2011. As 
of November 2015, he had restructured mortgage debt on his three rental properties, but 
he owed approximately $142,780 in credit card collection debt. More progress is needed 
toward addressing his delinquencies. Clearance is denied. 
Statement of the Case 
On November 3, 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 (EO) 
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 
Determining Eligibility for Access to Classified Information (AG) effective within the DOD on 
September 1, 2006. 
       02/06/2017
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On December 8, 2015, Applicant answered the SOR allegations and requested a 
hearing before an administrative judge from the Defense Office of Hearings and Appeals 
(DOHA). On May 19, 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. I scheduled a hearing for June 16, 2016. At the request of 
Applicant’s counsel, on May 25, 2016, I moved the hearing to June 15, 2016. 
 
I convened the hearing as rescheduled. Three Government exhibits (GEs 1-3) and 
six Applicant exhibits (AEs A-F) were admitted into evidence without objection, and 
Applicant testified, as reflected in a transcript (Tr.) received on June 22, 2016. I held the 
record open for two weeks after the hearing for Applicant to submit documentary evidence. 
On June 24, 2016, Applicant submitted through his counsel AE G, which was admitted into 
the record without objection. The record closed on June 27, 2016, on notification to the 
parties that the exhibit was entered into evidence. 
 
Summary of SOR Allegations 
 
 The SOR alleges under Guideline F that, as of November 3, 2015, Applicant was 
past due $5,065 (SOR ¶ 1.a), $1,591 (SOR ¶ 1.b), and $2,195 (SOR ¶ 1.c) on three 
mortgages with the same lender and that he owed collection balances totaling $164,091 on 
ten other accounts (SOR ¶¶ 1.d-1.m). Applicant submitted a pro se response to the SOR 
allegations in which he denied the mortgage delinquencies in that the loans had been 
transferred and brought current. He denied the collection debts of $11,661 (SOR ¶ 1.e) 
and $438 (SOR ¶ 1.m) in that they had been settled. He denied the collection debt of 
$9,212 (SOR ¶ 1.f) in that it was purchased by the creditor bank identified in SOR ¶¶ 1.h-
1.j and surmised it was included in the collection debt alleged in SOR ¶¶ 1.h, 1.i, or 1.j. 
Applicant admitted the collection balances in SOR ¶ 1.d ($22,293), ¶ 1.g ($38,815),  ¶ 1.h 
($23,464), ¶ 1.i ($17,685), ¶ 1.j ($15,437), ¶ 1.k ($14,999), and ¶ 1.l ($10,087). Applicant 
indicated that after restructuring the mortgage loans to bring them current and settling 
some of his credit card delinquencies, he was in a position to arrange repayment plans with 
his remaining creditors. 
 
Findings of Fact 
 
 After considering the pleadings, exhibits, and transcript, I find that the debt in SOR ¶ 
1.f is likely a duplicate listing of the debt in SOR ¶ 1.j.  It was not established as a separate 
outstanding balance. Additional findings of fact follow. 
 
 Applicant is a 59-year-old senior software engineer with two bachelor’s degrees 
awarded in May 1979 and December 1982, and a master’s degree awarded in August 
1984. He served honorably on active duty as an officer in the U.S. military from August 
1979 to August 1983 and in the reserves from August 1983 until November 1989. 
Applicant has worked for his present employer, a defense contractor, since November 
1986. He has held a DOD top secret clearance since approximately 1998. (GE 1; Tr. 17-
20.) 
 
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 Applicant was married from May 1994 to April 1996. He has no children. He has 
been in a cohabitant relationship since 2000. (GE 1.) 
 
 Applicant has lived in his current residence since 2001. His current mortgage loan 
on the home was obtained in September 2003 for $228,000. He also owns three rental 
properties: a condominium that he purchased in the early 1980s; his next residence, a 
single-family home (property X) bought in the early 1990s that he turned into a rental when 
he bought his farm in 2001; and a house inherited from his father in the mid-1990s that his 
mother manages for him. (Tr. 28-29, 74-76.) Available credit records show that he obtained 
mortgages of $81,000 in May 2003 (SOR ¶ 1.b), $67,500 in September 2003 (SOR ¶ 1.c), 
and $225,000 in December 2003 (SOR ¶ 1.a) on the rental properties. (GEs 2, 3.) The 
largest mortgage was on property X. (Tr. 29.) 
 
 Around 2002, Applicant and his cohabitant started a business that involves animal 
breeding. (Tr. 52.) Prices were high for the animals at that time, and they started with 
around five animals. (Tr. 72, 77.) Applicant relied on credit cards for the infrastructure and 
to purchase animals. (Tr. 54.) At its peak around 2008, they had about 70 animals, which 
Applicant testified were worth between $5,000 and $10,000 each, although some of the 
animals were co-owned. (Tr. 69, 73, 78.) They were starting to make some good sales, 
although the business had yet to turn a profit as of 2009, when the recession hit and the 
market for their animals declined. (Tr. 21, 24-25. 53.) Around that same time, Applicant’s 
income from his defense-contractor employment declined by ten percent because the 
company discontinued a program providing him a bonus for agreeing to be deployed on 
short notice. (Tr. 20-21, 54-55.) Applicant began to struggle to maintain the payments on 
some of his open credit card accounts. (Tr. 54-55.) 
 
 Applicant’s financial problems were exacerbated when, in 2011, his tenants in 
property X vacated six months into their two-year lease. In addition to the loss of rental 
income, which was around $1,800 a month, Applicant incurred costs to clean and prepare 
the property and to find new tenants. He then had other tenants, who moved out before 
their one-year lease ended. Applicant struggled to pay the mortgages on his rental 
properties without the full rental income. (Tr. 29, 57-58.) Several credit card accounts went 
to collection. (GE 2.) Applicant contacted his creditors, and he paid those debts that he 
could. (Tr. 59.) On August 11, 2011, the creditor in SOR ¶ 1.e obtained an $11,661 
summary judgment against Applicant. In 2012, the creditor in SOR ¶ 1.m filed for a small 
claims judgment against Applicant. A separate collection action filed against Applicant in 
2012 was dismissed by the court in September 2013. (AEs D, G; Tr. 41.) Applicant 
believes that a settlement was reached on the account in SOR ¶ 1.e, which led to the 
dismissal. (Answer; Tr. 42.) He subsequently testified that the $11,661 debt had been 
cancelled by a creditor in 2013. (Tr. 67.) In October 2015, Applicant’s attorney advised him 
that he had no records showing that the 2011 judgment (SOR ¶ 1.e) had been paid. (AE 
D.) 
 
 Applicant earned $107,468 from his defense contractor employment in 2012, but he 
had rental losses of $18,278 and farm losses of $19,812. (AE A.) In 2013, his wages 
totaled $109,097, but he claimed rental losses of $16,120 and farm losses of $14,051. He 
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had to report as income $11,664 in debt cancelled by a creditor in 2013. In 2014, Applicant 
earned $107,249, but reported rental losses of $15,624 and farm losses of $10,697.1 (AE 
A.) Some of the farm losses were from depreciation. (Tr. 69.) 
 
 As of April 2014, Applicant was past due 60 days for $2,195 on the loan in SOR ¶ 
1.c. On the other two mortgages, he was 90 days past due for $5,065 on the loan in SOR ¶ 
1.a, and for $1,591 on the loan in SOR ¶ 1.b. Applicant was paying the mortgage on his 
own residence under a partial payment agreement. His mortgage had a balance of 
$185,256. (GE 2.) 
 
 On April 30, 2014, Applicant completed and certified to the accuracy of a 
Questionnaire for National Security Positions (SF 86) to renew his security clearance 
eligibility. Applicant responded affirmatively to financial record inquiries concerning any 
delinquency involving routine accounts. He listed no specific debts, but referred to his 
credit report. He indicated that the type of property involved was a single-family 
home/condominium, and that the debt was incurred because of “salary reduction due to 
company-wide elimination of bonus program; single-family rental property vacancy.” He 
indicated that he was refinancing and making repayment plans to resolve his debts.  
Applicant also answered “Yes” to whether he was a party to any non-criminal court actions 
in the last ten years. He disclosed two collection actions (SOR ¶ 1.m and SOR ¶ 1.e) and a 
landlord/tenant matter. He indicated that they were all dismissed. (GE 1.) 
 
 As of May 2014, Applicant’s credit record showed credit card collection balances of 
$22,293 (SOR ¶ 1.d), $11,661 (SOR ¶ 1.e), $38,815 (SOR ¶ 1.g), $23,464 (SOR ¶ 1.h), 
$17,685 (SOR ¶ 1.i), $15,437 (SOR ¶ 1.j), $14,999 (SOR ¶ 1.k), $10,087 (SOR ¶ 1.l), and 
$438 (SOR ¶ 1.m).2 (GE 2.) The debt in SOR ¶ 1.f had been charged off for $9,212 and 
transferred to a collection entity (likely duplicated in SOR ¶ 1.j). The debts had been in 
collection since 2011. (GE 3.) Applicant had fully satisfied the debt in SOR ¶ 1.m as of 
October 2014. (AEs D, G; Tr. 37-40.) He was not in a financial position to accept the 
occasional settlement offers received from collection entities on his other accounts. (Tr. 
61.) 
 
 As of January 21, 2016, the collection debts in SOR ¶ 1.g, ¶ 1.h (updated balance 
$24,622), ¶ 1.j (updated balance $15,982), and ¶¶ 1.k-1.m were still on his credit record. 
Applicant had successfully refinanced the mortgages on his rental properties in the spring 
of 2015 by extending the loans to 40 years, which dropped his monthly payments. (Tr. 60.) 
Since March 2015, he had been making timely monthly payments of $1,703 (SOR ¶ 1.a), 
$518 (SOR ¶ 1.b), and $1,037 (SOR ¶ 1.c). Applicant’s mortgage on his residence was 
delinquent from July 2014 until March 2015. He had extended that mortgage to 40 years as 
well and was making timely payments of at least his scheduled monthly payment of $1,887. 
                                                 
1 Applicant testified that his rental income situation stabilized around 2013. (Tr. 56.) His income tax return for 
2014 shows a substantial loss in rental income. (AE A.) It is unclear to what extent Applicant incurred costs to 
prepare the properties to rent them out in 2014. 
 
2 The credit card account in SOR ¶ 1.m was placed for collection for $1,887 in August 2011. Applicant made 
payments through October 2013 to reduce the collection balance to $438. (GE 3.) 
 
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Applicant was also repaying a $6,599 unsecured loan obtained in November 2015, a 
home-equity loan obtained for $70,800 in June 2004,3 and a $500 line of credit debt. He 
was making timely payments on three open credit cards totaling $26,059. (GE 3.) 
 
 As of June 2016, Applicant’s rental properties were fully occupied. (Tr. 29.) He 
receives monthly rental income of $2,100 from property X and of $950 and $899 from the 
other rental units. (AE B.) Applicant intends to keep the rental properties. (Tr. 28-29.) If he 
were to sell them, he would take a “financial hit” because of previous depreciation and 
deductions for tax purposes. (Tr. 30.) 
 
 Applicant and his cohabitant still operate their farm, which serves as a full-time job 
for his cohabitant. (Tr. 77). As of June 2016, they had 35 animals. (Tr. 26.) They 
intentionally decreased the herd size to reduce their costs, including insurance for the 
animals, and to make the farm more manageable. (Tr. 70.) They intend to continue with the 
farm to supplement his income in retirement. (Tr. 29, 71, 79.) 
 
 Applicant testified that his financial situation has been stable for several years. (Tr. 
63.) He does not live extravagantly. He has two vehicles, both vans 20 and 22 years old. 
(Tr. 32.) He has over $1 million in retirement accounts, and his real estate assets are worth 
approximately $879,827. (AEs B, F.) While he could withdraw funds from his retirement 
accounts to address his unpaid delinquent debts, he would be penalized ten percent plus 
have to pay the taxes on the withdrawal. (Tr. 31, 62.) His attorney had suggested in 2011 
that he file for bankruptcy, but he wants to repay his debts. (Tr. 31-32, 57-58.) 
 
 On June 13, 2016, Applicant entered into an agreement to repay $8,640 to settle the 
debt in SOR ¶ 1.l in monthly installments of $240. (AE C; Tr. 35.) After paying his expenses 
and debts, including the $240 promised to the creditor in SOR ¶ 1.i, but nothing toward 
other collection accounts, Applicant had a reported $1,290 in discretionary monthly income. 
(AE B.) Applicant had yet to arrange for repayment of the collection debt in SOR ¶ 1.i. He 
was not in negotiations to repay the debt as of his hearing, but he intends to address the 
debt. (Tr. 44-45.) Applicant testified to his belief that the $14,999 debt alleged in SOR ¶ 1.k 
was transferred to the collection entity in SOR ¶ 1.j. (Tr. 49.) Available credit records show 
that while the original creditor and date of last activity (February 2011) are the same for 
SOR ¶¶ 1.k and 1.j, they appear to be different accounts placed for collection on August 
30, 2011. (GEs 2, 3.) Applicant admitted both debts when he answered the SOR. Of the 
collection accounts alleged in the SOR, only those in SOR ¶¶ 1.i and 1.l were on his credit 
report as of June 1, 2016. (AE F.) He plans to reach out to the collection entities and 
negotiate settlements of his collection debts. (Tr. 63.) Applicant attributes the delay in 
addressing his delinquent credit card debts to having to make catch-up payments on the 
mortgage loans in the restructuring. (Tr. 64.) 
                                                 
3 Applicant testified that the home-equity loan was obtained for their first purchase of animals for their farm. 
(Tr. 71.) 
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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 EO 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 concerns about financial considerations are set forth in AG ¶ 18: 
 
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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 debt in SOR ¶ 1.f appears to be an earlier balance of the collection debt in SOR 
¶ 1.j. The collection debt in SOR ¶ 1.e may well have been cancelled by the creditor in 
2013. Applicant accounted for a cancelled debt of like amount on his income tax return, 
and he denied the debt as an outstanding liability when he answered the SOR. Applicant 
satisfied the debt in SOR ¶ 1.m in October 2014. He restructured the delinquent mortgage 
loans on his three rental properties (SOR ¶¶ 1.a-1.c) by March 2015 to bring the accounts 
current. However, several of his credit card collection debts totaling approximately 
$142,780 (SOR ¶¶ 1.d and 1.g-1.l) were still outstanding with no demonstrated progress 
toward resolving them as of the issuance of the SOR in early November 2015. 
Disqualifying conditions AG ¶ 19(a), “inability or unwillingness to satisfy debts,” and AG ¶ 
19(c), “a history of not meeting financial obligations,” apply. 
 
 Mitigating condition 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,” has 
limited applicability. The credit card accounts were placed in collection in 2011. There had 
been no activity on some of the accounts (SOR ¶¶ 1.d, 1.h-1.j) since 2009. Although the 
debts were not incurred recently and appear to have been situational, it is difficult to find 
that they no longer cast doubt on Applicant’s judgment and reliability, given he has yet to 
take steps to address most of them. With one collection entity continuing to add interest or 
fees or some combination on the debts in SOR ¶ 1.h and SOR ¶ 1.j to bring their 
respective balances to $24,622 and $15,982, Applicant’s outstanding delinquencies totaled 
approximately $144,483 as of January 2016. 
 
 Applicant has a case for partial mitigation under 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.” Applicant had 
no control over the decline in the market for his animals in 2009, over his employer’s 
discontinuation of a bonus program that caused his salary to decline by ten percent, or 
over tenants vacating his properties before the end of their lease term. He had the greatest 
problem keeping tenants in property X, which had brought in the most rental income and 
had the highest mortgage payment. Even so, Applicant assumed some risk with both his 
farm and rental property ventures that is not mitigated by AG ¶ 20(b). 
 
 Even if Applicant’s financial problems arose in whole or in part to circumstances 
outside of his control, I may still consider whether Applicant has since acted in a 
reasonable manner when dealing with those financial difficulties. See e.g., ISCR Case No. 
05-11366 at 4 n.9 (App. Bd. Jan 12, 2007). AG ¶ 20(b) requires that an applicant act 
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responsibly to address his debts. Applicant acted responsibly when he chose to restructure 
his delinquent mortgage loans. However, while he had to repay the past-due balances on 
the mortgage loans, the loans were current as of March 2015. There is no evidence of any 
efforts to negotiate or arrange for repayment with his other creditors over the next year until 
June 2016, when he arranged to repay the debt in SOR ¶ 1.l at $240 per month. A 
component of whether Applicant acted in a reasonable manner when dealing with his 
financial difficulties is whether he maintained contact with his creditors and attempted to 
negotiate partial payments. As of his hearing in June 2016, he had not contacted the 
collection entity in SOR ¶ i, even though the collection debt is still adversely affecting his 
credit and is of concern to the DOD. Applicant has not given priority to addressing his 
outstanding delinquencies. While he does not have appreciable savings apart from his 
retirement assets, which are considerable, he reports monthly discretionary income in 
excess of $1,000.  
 
 Although apparently in response to court action, Applicant’s payments to resolve the 
debt in SOR ¶ 1.m implicate 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, to a lesser extent, AG ¶ 20(d), “the individual initiated a good-faith 
effort to repay overdue creditors or otherwise resolve debts.” Both AG ¶ 20(c) and AG ¶ 
20(d) apply to his mortgage restructuring. Applicant’s credit reports show a track record of 
timely payments since March 2015 on the loans in SOR ¶¶ 1.a-1.c. AG ¶ 20(c) also has 
some applicability to the debt in SOR ¶ 1.e, if the debt cancelled in 2013 by the creditor is 
that debt. Applicant’s recent settlement arrangements for the debt in SOR ¶ 1.l show some 
good faith under AG ¶ 20(d), but he had not established a track record of repayment 
toward the accounts in SOR ¶¶ 1.d and 1.g-1.l to fully mitigate the financial considerations 
concerns under either AG ¶ 20(c) or AG ¶ 20(d). 
 
 AG ¶ 20(e) has limited applicability to the mortgage loans on which Applicant is 
making timely payments (SOR ¶¶ 1.a-1.c), to the credit card collection debt that was likely 
cancelled by the creditor in 2013 (SOR ¶ 1.e), and to the credit card collection debt that 
was paid off in October 2014 (SOR ¶ 1.m) in that those past-due accounts were resolved 
or, in the case of the debt cancelled, excused by the creditor with tax implications for 
Applicant’s income before the SOR was issued. AG ¶ 20(e) also applies in that the debt in 
SOR ¶ 1.f is an earlier balance of the collection debt in SOR ¶ 1.j and thus does not 
represent an additional debt. 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 
proof to substantiate the basis of the dispute or provides evidence of actions 
to resolve the issue. 
 
 Applicant is not required to be debt free for continued security clearance eligibility. 
Yet, Applicant did not exercise the sound judgment that must be expected from persons 
entrusted with the nation’s secrets when he allowed several credit card balances to go to 
collection. In ISCR Case No. 11-05365 at 3 (App. Bd. May 1, 2012) (citation omitted), the 
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Appeal Board explained the scope and rationale for the financial considerations security 
concern as follows: 
 
This concern is broader than the possibility that an applicant might knowingly 
compromise classified information in order to raise money in satisfaction of 
his or her debts. Rather, it requires a Judge to examine the totality of an 
applicant’s financial history and circumstances. The Judge must consider 
pertinent evidence regarding the applicant’s self-control, judgment, and other 
qualities essential to protecting the national secrets as well as the 
vulnerabilities inherent in the circumstances. The Directive presumes a 
nexus between proven conduct under any of the Guidelines and an 
applicant’s security clearance eligibility. 
 
Even if some debts may no longer be legally enforceable because of a state statute of 
limitations, or they cannot be legally listed on a credit report due to the passage of time, 
they remain relevant for security clearance purposes. See ISCR Case No. 15-01208 (App. 
Bd. Aug. 26, 2016), citing, e.g., ISCR Case No. 03-20327 (App. Bd. Oct. 26, 2006) and 
ISCR Case No. 03-04779 (App. Bd. Jul. 20, 2005). Applicant has not made enough 
progress toward resolving his credit card collection debts 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).4 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. 
 
 A determination of any applicant=s eligibility for a security clearance should not be 
made as punishment for specific past conduct, but on a reasonable and careful evaluation 
of all the evidence of record to decide if a nexus exists between established facts and a 
legitimate security concern. In his favor, Applicant is a longtime defense contractor 
employee. There is no evidence that he has ever committed a security violation. He took 
on a large amount of consumer credit debt to start a farming business that has been his 
cohabitant’s full-time job with the intent that the business would provide income when he 
retires. Circumstances outside of his control, most notably the loss of ten percent of his 
                                                 
4 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. 
 
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defense-contractor salary and a decline in the market for his animals, caused some 
financial strain. He stopped paying on several credit card accounts even before he began 
having tenant problems in 2011. Applicant could possibly have sold one or more of his 
rental properties or have taken a premature withdrawal of retirement assets to address his 
sizeable delinquent credit card burden, but either choice had negative tax implications. 
 
 As a consequence of Applicant acting in his financial self-interest, several creditors 
have received no satisfaction while Applicant receives rental income to cover his 
obligations, and he continues to operate his farm. Applicant expressed a credible desire to 
pay his debts, but promises to pay at some future date are not a substitute for a track 
record of paying debts in a timely manner and otherwise acting in a financially responsible 
manner. See ISCR Case No. 07-13041 at 4 (App. Bd. Sep. 19, 2008). 
 
 It is well settled that once a concern arises regarding an applicant’s security 
clearance eligibility, there is a strong presumption against the grant or renewal of a security 
clearance. See Dorfmont v. Brown, 913 F. 2d 1399, 1401 (9th Cir. 1990). For the reasons 
noted above, I am unable to find 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:   AGAINST APPLICANT 
 
Subparagraphs 1.a-1.c:   For Applicant 
Subparagraph 1.d:   Against Applicant 
Subparagraphs 1.e-1.f:  For Applicant 
Subparagraphs 1.g-1.l:  Against Applicant 
Subparagraph 1.m:   For Applicant 
 
Conclusion 
 
In light of all of the circumstances, it is not clearly consistent with the national 
interest to continue Applicant’s eligibility for a security clearance. Eligibility for access to 
classified information is denied. 
 
 
_____________________ 
Elizabeth M. Matchinski 
Administrative Judge