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                          DEPARTMENT OF DEFENSE 
         DEFENSE OFFICE OF HEARINGS AND APPEALS 
           
             
 
 
In the matter of: ) 
 ) 
  )  ISCR Case No. 16-02196 
  )   
 ) 
Applicant for Security Clearance ) 
 
 
Appearances 
 
For Government: Nicole A. Smith, Esq., Department Counsel 
For Applicant: Pro se 
 
 
August 31, 2017 
______________ 
 
Decision 
______________ 
 
 
MOGUL, Martin H., Administrative Judge: 
 
Statement of the Case 
 
On September 16, 2016, in accordance with Department of Defense (DoD) 
Directive 5220.6, as amended (Directive), the DoD issued Applicant a Statement of 
Reasons (SOR) alleging facts that raise security concerns under Guideline F.1 (Item 1.) 
The SOR further informed Applicant that, based on information available to the 
government, DoD adjudicators could not make the preliminary affirmative finding it is 
clearly consistent with the national interest to grant or continue Applicant’s security 
clearance. 
 
 On October 11, 2016, Applicant submitted a written reply to the SOR with six 
attachments (RSOR 1-6), and he requested that his case be decided on the written 
record in lieu of a hearing. (Item 2.)  On November 9, 2016, Department Counsel issued 
the Department's written case. A complete copy of the file of relevant material (FORM) 
                                                          
1 I considered the previous Adjudicative Guidelines, effective September 1, 2006, as well as the new 
Adjudicative Guidelines, effective June 8, 2017. My decision would be the same if the case was 
considered under the previous Adjudicative Guidelines, effective September 1, 2006. 
 
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was provided to Applicant. In the FORM, Department Counsel offered seven 
documentary exhibits. (Items 1-7.) Applicant was given the opportunity to file objections 
and submit material in refutation, extenuation, or mitigation. A response was due on 
December 18, 2016. Applicant submitted additional documents that have been identified 
and entered into evidence without objection as Items A through D. The case was 
assigned to this Administrative Judge on August 9, 2017. Based upon a review of the 
pleadings and exhibits, eligibility for access to classified information is denied. 
 
Findings of Fact 
 
 After a thorough and careful review of the pleadings, and exhibits, I make the 
following findings of fact.  
 
Applicant is 59 years old. He has been married to his current spouse since 2011, 
and he was previously divorced from his first spouse in 1995. Applicant has three adult 
children. Applicant received a Master’s degree in 1990. Applicant served in the Army 
National Guard on Active Reserve from October 1993 to October 2001, when he 
received an Honorable Discharge. Applicant seeks a DoD security clearance in 
connection with employment in the defense sector. (Item 3.) 
 
Guideline F, Financial Considerations  
 
 The SOR lists 30 allegations (1.a. through 1.dd.) regarding financial difficulties, 
specifically overdue debts, under Adjudicative Guideline F. The delinquent debts total 
more than $50,000. All of the SOR allegations were established by Items 5 and 6, and 
they will be discussed below in the order they were listed on the SOR: 
 
1.a. This overdue debt is cited in the SOR for a judgment filed against Applicant 
in January 2014, in the amount of $396. Applicant denied this debt in his RSOR, and he 
wrote that he has retained the services of a law firm because his credit reports contain 
numerous errors, which date back to 2009. He claimed that to date he has had 47 
errors removed from his credit reports. (Item 2.)  No independent evidence has been 
introduced to establish that this debt has been resolved or reduced. 
 
1.b. This overdue debt is cited in the SOR for a judgment filed against Applicant 
in May 2012, in the amount of $5,971. Applicant admitted this debt in his RSOR, and he 
wrote that he was attempting to locate the creditor to resolve this debt. (Item 2.) No 
independent evidence has been introduced to establish that this debt has been resolved 
or reduced. 
   
1.c. This overdue debt is cited in the SOR for a judgment filed against Applicant 
in February 2010, in the amount of $984. Applicant denied this debt in his RSOR. (Item 
2.) 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 $1,750, with an outstanding balance of $40,150. Applicant admitted this debt in his 
 
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RSOR, and he wrote that this matter has been resolved. He added that he pays $923 a 
month and the current balance is $35,515. (Item 2.) No independent evidence has been 
introduced to establish that this debt has been resolved or reduced.    
        
1.e. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $9,217. Applicant denied this debt in his RSOR, and he wrote that this student loan 
has been settled in full in June 2013. (Item 2.) No independent evidence has been 
introduced to establish that this debt has been resolved or reduced.  
 
1.f. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $4,293. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence 
has been introduced to establish that this debt has been resolved or reduced. 
  
1.g. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $1,740. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence 
has been introduced to establish that this debt has been resolved or reduced. 
 
1.h. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $550. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
  
1.i. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $522. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
1.j. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $8,249. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence 
has been introduced to establish that this debt has been resolved or reduced. 
 
1.k. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $7,449. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence 
has been introduced to establish that this debt has been resolved or reduced. 
 
1.l. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $2,017. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence 
has been introduced to establish that this debt has been resolved or reduced. 
 
1.m. This overdue debt is cited in the SOR for a delinquent account in the 
amount of $1,692. Applicant denied this debt in his RSOR. (Item 2.) No independent 
evidence has been introduced to establish that this debt has been resolved or reduced. 
 
1.n. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $1,339. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence 
has been introduced to establish that this debt has been resolved or reduced. 
 
 
 
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1.o. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $1,131. Applicant denied this debt in his RSOR, and he wrote that he currently has 
cellular service with this same creditor and his bill is current. (Item 2.) No independent 
evidence has been introduced to establish that this debt has been resolved or reduced. 
 
1.p. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $1,072. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence 
has been introduced to establish that this debt has been resolved or reduced. 
 
1.q. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $989. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
1.r. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $762. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
1.s. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $523. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
1.t. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $436. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
1.u. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $317. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
1.v. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $300. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
1.w. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $262. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
1.x. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $231. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
1.y. This overdue debt is cited in the SOR for a delinquent account in the amount 
of $210. Applicant denied this debt in his RSOR. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
 
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1.z. This overdue debt is cited in the SOR for a delinquent medical account in the 
amount of $158. Applicant denied this debt in his RSOR. (Item 2.) No independent 
evidence has been introduced to establish that this debt has been resolved or reduced. 
 
1.aa. This overdue debt is cited in the SOR for a delinquent account in the 
amount of $55. Applicant denied this debt in his RSOR. (Item 2.) No independent 
evidence has been introduced to establish that this debt has been resolved or reduced. 
 
1.bb. This overdue debt is cited in the SOR for a delinquent account in the 
amount of $42. Applicant denied this debt in his RSOR. (Item 2.) No independent 
evidence has been introduced to establish that this debt has been resolved or reduced. 
 
1.cc. This overdue debt is cited in the SOR for a delinquent account in the 
amount of $547. Applicant admitted this debt in his RSOR, and he wrote he has paid 
$50 on this account and has a balance of $497. He contended that made arrangements 
to pay the account in full on November 1, 2016. (Item 2.) No independent evidence has 
been introduced to establish that this debt has been resolved or reduced. 
 
1.dd. It is alleged in the SOR that Applicant's security clearance was previously 
revoked in approximately November 2012 due to financial issues. Applicant admitted 
this debt in his RSOR. (Item 2.) 
 
Among the documents Applicant submitted with his RSOR was a letter from an 
attorney for the law firm Applicant retained to resolve his debts. He wrote that according 
to their client (Applicant) there is reason to believe that various accounts appearing on 
the credit reports are inaccurate, invalid and/or unverifiable. He also wrote that 
according to his client, there were 18 items removed from Equifax, eight items removed 
from Experian, and 21 items removed from TransUnion. (RSOR-1.)  
 
Applicant explained that his financial difficulties occurred because of three 
reasons: significant loss of property due to Hurricane Katrina; relocation to a different 
city because his command was on the Base Realignment and Closure (BRAC) list; and 
travel and funeral costs due to the death of his father in 2009. Applicant further wrote 
that he has always lived within his budget, but he had issues with his credit reports that 
in the past he did not know how to address. He reiterated that he hired a law firm to try 
to help him resolve what he believed to be inaccuracies on his credit reports. He also 
wrote that he is in the second year of a 60 month loan in which he is paying $464 each 
month, and he has not missed a payment. Finally, he wrote that he is currently 
developing a plan to eliminate all of his remaining debt within three years. (RSOR-2.)  
 
As noted above, Applicant did submit additional documents in response to the 
FORM, but none of the documents established that any of the SOR delinquent debts 
had been resolved or reduced.  Finally, Applicant did not submit a Personal Financial 
Statement or provide any other independent information or evidence to establish that 
his current financial status is stable.  
 
 
 
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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 to be used 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, administrative judges apply the guidelines in 
conjunction with the factors listed in AG ¶ 2 describing the adjudicative process. The 
administrative judge’s overarching adjudicative goal is a fair, impartial, and 
commonsense decision. According to AG ¶ 2(a), 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 national security 
eligibility 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 the applicant or proven by Department Counsel, and 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 (EO) 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 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 or sensitive information. Financial distress can also be 
caused or exacerbated by, and thus can be a possible indicator of, other 
issues of personnel security concern such as excessive gambling, mental 
health conditions, substance misuse, or alcohol abuse or dependence. An 
individual who is financially overextended is at greater risk of having to 
engage in illegal or otherwise questionable acts to generate funds. 
Affluence that cannot be explained by known sources of income is also a 
security concern insofar as it may result from criminal activity, including 
espionage. 
 
  Applicant had many delinquent debts for several years. No independent evidence 
was introduced to establish that any of his significant SOR overdue debts have been 
reduced or resolved, and there has been no evidence introduced to establish that 
Applicant will be able to be more responsible in resolving his debts in the future.  
 
  The guideline notes several conditions that could raise security concerns under 
AG ¶ 19. The evidence is sufficient to raise disqualifying conditions (a) and (c) as 
potentially applicable in this case:   
 
(a) inability to satisfy debts; 
 
(b) unwillingness to satisfy debts regardless of the ability to do so; 
 
(c) a history of not meeting financial obligations; 
 
(d) deceptive or illegal financial practices such as embezzlement, 
employee theft, check fraud, expense account fraud, mortgage fraud, filing 
deceptive loan statements and other intentional financial breaches of trust; 
 
(e) consistent spending beyond one's means or frivolous or irresponsible 
spending, which may be indicated by excessive indebtedness, significant 
negative cash flow, a history of late payments or of non-payment, or other 
negative financial indicators; 
 
 
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(f) failure to file or fraudulently filing annual Federal, state, or local income 
tax returns or failure to pay annual Federal, state, or local income tax as 
required; 
 
(g) unexplained affluence, as shown by a lifestyle or standard of living, 
increase in net worth, or money transfers that are inconsistent with known 
legal sources of income; 
 
(h) borrowing money or engaging in significant financial transactions to 
fund gambling or pay gambling debts; and 
 
(i) concealing gambling losses, family conflict, or other problems caused 
by gambling.  
 
 AG ¶ 20 provides conditions that could mitigate security concerns. I considered 
all of the mitigating conditions under AG ¶ 20 including: 
 
(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; 
 
(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, a death, divorce or separation, 
clear victimization by predatory lending practices, or identity theft), and the 
individual acted responsibly under the circumstances; 
 
(c) the individual has received or is receiving financial counseling for the 
problem from a legitimate and credible source, such as a non-profit credit 
counseling service, and there are clear indications that the problem is 
being resolved or is under control; 
 
(d) the individual initiated and is adhering to a good-faith effort to repay 
overdue creditors or otherwise resolve debts; 
 
(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; 
 
(f) the affluence resulted from a legal source of income; and 
 
(g) the individual has made arrangements with the appropriate tax 
authority to file or pay the amount owed and is in compliance with those 
arrangements. 
 
 
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 The financial loss through Hurricane Katrina, his relocation, and his father’s 
death were certainly beyond Applicant's control. Also, Applicant has begun the process 
of resolving his delinquent debts by engaging the services of a law firm. However, no 
evidence has been introduced to establish that Applicant has acted responsibly by 
resolving or reducing any of his delinquent SOR debts, is current with all his recent 
debt, or will be able to live within his means in the future. I do not find that mitigation 
under AG ¶ 20 has been established. 
 
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 
conduct and all relevant circumstances. The administrative judge should consider the 
nine adjudicative process factors listed at AG ¶ 2(d):  
 
(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 
facts and circumstances surrounding this case. I have incorporated my comments under 
Guideline F in my whole-person analysis.  
 
Overall, the record evidence leaves me with significant questions and doubts as 
to Applicant’s eligibility and suitability for a security clearance. For all these reasons, I 
conclude Applicant has not mitigated the Financial Considerations security concerns.  
 
Formal Findings 
 
 Formal findings for or against Applicant on the allegations set forth in the SOR, 
as required by ¶ E3.1.25 of the Directive, are: 
 
Paragraph 1, Guideline F:   AGAINST APPLICANT 
 
  Subparagraphs 1.a.-1.dd:   Against Applicant 
 
 
 
 
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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