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                 DEPARTMENT OF DEFENSE 
     DEFENSE OFFICE OF HEARINGS AND APPEALS 
 
 
 
 
In the matter of:  ) 
 ) 
  (Redacted)  )   ISCR Case No. 16-00706 
   ) 
Applicant for Security Clearance  ) 
 
 
Appearances 
 
For Government: Rhett C. Petcher, Esq., Department Counsel 
For Applicant: Pro se 
 
 
______________ 
 
Decision 
______________ 
 
 
MATCHINSKI, Elizabeth M., Administrative Judge: 
 
Applicant owed five delinquent debts totaling $16,782 as of June 2016. Some 
factors outside of his control contributed to his financial difficulties, but his financial 
situation remains tenuous. Clearance is denied. 
 
Statement of the Case 
 
 On June 17, 2016, the Department of Defense Consolidated Adjudications Facility 
(DOD CAF) issued a Statement of Reasons (SOR) to Applicant, detailing security concerns 
under Guideline F, financial considerations. The SOR explained 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. 
 
On July 12, 2016, Applicant answered the SOR allegations and requested a hearing 
before an administrative judge from the Defense Office of Hearings and Appeals (DOHA). 
 
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On January 25, 2017, the case was assigned to a DOHA administrative judge 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 10, 2017, the case was transferred to 
me. On April 19, 2017, I scheduled a hearing for May 24, 2017. 
 
While this case was pending a hearing, the Director of National Intelligence (DNI) 
issued Security Executive Agent Directive 4 establishing new National Security Adjudicative 
Guidelines (AG) applicable to all covered individuals who require national security eligibility 
or eligibility to hold a sensitive position. On May 18, 2017, I provided Applicant with a copy 
of the updated Directive incorporating the new AG which supersede the adjudicative 
guidelines implemented in September 2006 and are effective for any adjudication made on 
or after June 8, 2017. I advised him that I would be adjudicating his security clearance 
eligibility under the new AG,1 and that I would consider a request to leave the record open 
after his hearing for additional information if necessary in light of this change in the AG. 
 
I convened the hearing as scheduled. Four Government exhibits (GEs 1-4) and two 
Applicant exhibits (AEs A-B) were admitted into evidence without objection. A letter of 
September 23, 2016, forwarding discovery of the Government’s exhibits to Applicant, was 
marked as a hearing exhibit (HE 1) but not entered into the record. Applicant testified, as 
reflected in a transcript (Tr.) received on June 2, 2017. 
 
I held the record open for one month for Applicant to submit additional 
documentation. On June 23, 2017, Applicant submitted AEs C-G, which were admitted 
without objection. The record closed on June 26, 2017, when Department Counsel 
expressed no objections to the admission of Applicant’s post-hearing submissions. 
 
Summary of Pleadings 
 
 The SOR alleges under Guideline F that, as of June 2016, Applicant owed collection 
debts of $8,842 (SOR ¶ 1.a), $3,702 (SOR ¶ 1.b), $100 (SOR ¶ 1.d), and $3,501 (SOR ¶ 
1.e) and a $637 charged-off credit card debt (SOR ¶ 1.c). When Applicant answered the 
SOR allegations, he admitted the debts without explanation.  
 
Findings of Fact 
 
 Applicant’s admissions to the five debts are accepted as findings of fact. After 
considering the pleadings, exhibits, and transcript, I make additional findings of fact as 
follows. 
 
Applicant is a 30-year-old high school graduate with 46 college credits toward a 
degree in mechanical engineering. (GE 1; Tr. 41.) He was married to his first wife from 
April 2007 to February 2009. He and his current spouse wed in September 2011. (GE 1.) 
 
                                                 
1 Application of the AGs that were in effect as of the issuance of the SOR would not change my decision in 
this case. 
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Applicant served honorably with a DOD secret clearance in an antiterrorism unit of 
the U.S. military reserves from August 2005 until August 2013. (GE 1; Tr. 40.) Applicant 
was activated for deployments from August 2005 to March 2006 to Iraq and from May 2011 
to March 2013, primarily to various overseas locations. On his return from Iraq, he worked 
at a casino as a security guard from April 2006 to June 2006 and then at a sandwich shop 
from July 2006 to September 2006. He worked for car dealerships from September 2006 to 
January 2007 and from January 2007 to April 2010, when he was laid off. Applicant held 
part-time employment in a warehouse of a home improvement retailer from April 2010 
through August 2010. (GE 1; Tr. 35-36.) 
 
 Applicant began working for his current employer, a defense contractor, as a 
security guard at $16 an hour in August 2010. (GE 1; Tr. 34-35.) Still in the military reserve 
at the time, Applicant was recalled to active duty in May 2011 and was deployed overseas 
from October 2011 to December 2011. He was then stationed in the United States until 
August 2012, when he was deployed overseas. He returned to his local reserve unit in 
March 2013. (GEs 1-2.) While on active duty, Applicant had income of $5,000 a month. (Tr. 
30.) 
 
 Applicant’s income declined to $2,500 to $3,000 a month after he left the military. 
He earned approximately $22 an hour in his defense contractor employment. In February 
2014, Applicant obtained an installment loan of $3,849 from a credit union (SOR ¶ 1.e). He 
relied on overtime earnings to make his monthly payment.  In March 2014, Applicant 
purchased a car for $28,000. He traded in his old car and obtained a loan of $23,904 from 
another credit union (SOR ¶ 1.a). Applicant soon became financially overextended 
because of his $477 monthly car payment. In May 2014, Applicant’s spouse’s vehicle had 
mechanical issues. Applicant obtained a $4,000 loan (SOR ¶ 1.b) to pay for the $1,200 to 
$1,300 in vehicle repair costs for his spouse’s car and to catch up on some bills. He was 
contractually obligated to repay that personal loan at $118 a month. In June 2014, 
Applicant began to fall behind 30 days on his car loan payments. (GEs 3-4; Tr. 28, 43-44.) 
 
 In late summer 2014, Applicant’s car was broken into, and his spouse no longer felt 
safe in the neighborhood. In September 2014, they moved into a single-family home at rent 
of $1,300 per month for the next six months.  (Tr. 66, 71.) Applicant borrowed $3,000 from 
his 401(k) account at work to pay the first month’s rent and an additional $1,300 for the 
security deposit. (Tr. 75.) In April 2015, Applicant and his spouse moved into their current 
residence at a substantially lower rent of $700 a month. (Tr. 59, 66.) By then, Applicant 
was seriously delinquent on his three loans and on a credit card account (SOR ¶ 1.c). The 
loans in SOR ¶¶ 1.a and 1.b were charged off for $12,042 in May 2015 and $3,932 in 
March 2015. In March 2015, a $637 credit card debt from December 2014 was charged off 
(SOR ¶ 1.c). In May 2015, a credit union charged off $3,849 on his loan (SOR ¶ 1.e). In 
August 2015, $100 in deposit-related debt owed yet another credit union was charged off 
(SOR ¶ 1.d). (GEs 3-4; Tr. 28, 38, 43-54.) 
 
 On August 8, 2015, 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 an inquiry concerning whether he was 
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currently utilizing or seeking assistance for financial difficulties and indicated that he was 
enrolled in a budget program with a credit union. He disclosed some delinquency involving 
routine accounts: a $580 credit card debt from October 2008 that was resolved in March 
2015; a $69 cable services debt from November 2012 that was paid in October 2013; the 
outstanding $637 credit debt in SOR ¶ 1.c; and the $12,042 defaulted car loan debt in SOR 
¶ 1.a. He attributed the recent credit card and car loan delinquencies to his spouse having 
lost her job. He indicated that he was establishing a payment plan for the credit card debt 
and that he needed to do the same for the car loan. (GE 1.) 
 
 On October 19, 2015, Applicant was interviewed by an authorized investigator for 
the Office of Personnel Management (OPM). About his defaulted car loan in SOR ¶ 1.a, 
Applicant explained that the loan became an issue around November 2014 when his 
spouse lost her job,2 and he fell behind on his payments. He indicated that he was making 
payments to the creditor and expected to have the debt satisfied by 2019. He expressed 
his belief that the $3,932 personal loan with the same credit union (SOR ¶ 1.b) was 
covered by the repayment plan for the car loan. About his personal loan in SOR ¶ 1.e, 
Applicant indicated that he fell behind on his payments because of loss of income, but he 
was working with the lender on repayment. Concerning the $100 debt in SOR ¶ 1.d, 
Applicant explained that because of a clerical error, his account continued to accumulate 
fees even though it was not in use. He expected the issue to be resolved soon, and he 
described his financial situation as improving. (GE 2.) Applicant made a payment of $250 
on his personal loan in SOR ¶ 1.b in November 2015 to reduce its balance to $3,682.3 (GE 
4.) 
 
 To improve his financial situation in the long term, Applicant voluntarily transitioned 
from his position to another field at work in January 2016. He went from $22 an hour in his 
previous job to $19 an hour while in training for the next nine months. (Tr. 28-32.) His 
spouse began working as a department manager for a clothing retailer in early 2016. (Tr. 
63.) 
 
 As of May 2016, Applicant was legally liable for $8,842 on the car loan (SOR ¶ 1.a) 
following repossession and sale of the vehicle.4 (GE 4; Tr. 28, 44-45.) He had made no 
payments on the $637 credit card delinquency (SOR ¶ 1.c) or on the personal loan in SOR 
¶ 1.e. The $100 in unpaid fees on his account with a credit union (SOR ¶ 1.d) was no 
longer on his credit record, although it remained unresolved. (GE 4; Tr. 53.) 
 
                                                 
2 Applicant testified discrepantly that his spouse lost her job as a bank teller around August 2015, and that his 
vehicle was repossessed around that same time. She had been earning $14-$15 an hour as a bank teller and 
was unemployed until early 2016. (Tr. 64-65.) 
 
3 Applicant testified that after the vehicle was repossessed, he made a payment on the car loan, but he could 
not continue to make the payments. (Tr. 45.) His credit report does not show any payment on that loan after 
April 2015. He made one $250 payment on the personal loan in SOR ¶ 1.b in November 2015. (GE 4.) 
 
4 According to Applicant, the vehicle was repossessed over $113 that he did not have a chance to pay. (Tr. 
44.) 
5 
 
 Around May or June 2016, Applicant began paying the IRS $250 a month on a 
federal income tax debt of $3,400 for tax year 2015. (Tr. 57-58.) In September 2016, 
Applicant’s hourly wage increased to $26 an hour. Around December 2016, his hourly 
wage increased to its present $28. (Tr. 38.) From October 2016 to May 2016, Applicant 
was on TDY for intensive training for his new career. He paid off the credit card debt in 
SOR ¶ 1.c in three installments between October 2016 and December 2016. (AE A; Tr. 49, 
51.) In late December, he paid a $106 gym fee in collection (not alleged). (AE B; Tr. 55.) 
Focused on ensuring that he passed an examination so that he could keep his job and 
needing to catch up on everyday bills, he made no effort to resolve the loans in SOR ¶¶ 
1.a-1.b and 1.e or to pay the $100 in deposit-related bank fees (SOR ¶ 1.d) while he was 
on TDY. (Tr. 32, 45-46, 53.) 
 
 On May 5, 2017, Applicant was notified by his state tax authority that he owed $255 
in delinquent state taxes, interest, and penalties for tax year 2016. Applicant paid the debt 
on June 22, 2017. (AE E; Tr. 56.) Applicant testified that he was current in his payments to 
the IRS for his tax debt for 2015 (Tr. 56), although he provided no documentation of those 
payments. 
 
 A few days before his hearing in May 2017, Applicant arranged to repay the 
personal loan in SOR ¶ 1.e at $200 a month starting in June 2017. (AE F; Tr. 53.) 
Applicant had yet to contact the creditor in SOR ¶¶ 1.a and 1.b about resolving the auto 
loan deficiency balance. (Tr. 29.) As of June 15, 2017, a collection entity was pursuing 
Applicant for the $8,842 balance on the loan in SOR ¶ 1.a. (AE D.) On June 9, 2017, 
Applicant paid the $100 in credit union fees in collection (SOR ¶ 1.d). (AE C.) He provided 
no documentation showing that he made his first payment toward the debt in SOR ¶ 1.e. 
 
 Applicant estimated his and his spouse’s household income to be $60,000 to 
$65,000 annually. (Tr. 64.) On an hourly wage just over $28, his take-home pay was 
approximately $685 per week.5 (AE G.) His spouse’s monthly net pay is approximately 
$2,500. (Tr. 64-65.) Yet, Applicant described their finances as “struggling.” (Tr. 65.) He 
testified that their expenses usually exceed their income. (Tr. 62.) Applicant and his spouse 
have less than $100 in their joint checking account and nothing in savings. (Tr. 63.) 
 
 Applicant’s spouse handles the household finances. (Tr. 71.) They have had a 
budget for only a few months and are not following it as consistently as Applicant would 
like. (Tr. 71.) They have identified some discretionary expenses, such as restaurant meals, 
that they have reduced. (Tr. 72.) Their monthly expenses are $700 for rent, $240 for 
cellphone service, $140 for cable/Internet service, $120 for electricity, $357 for his 2016 
model-year economy car, $450 for her car, $260 for car insurance, $100 for gasoline for 
him, $300 for groceries, and $250 to the IRS for their 2015 taxes. (Tr. 57-61.) He testified 
that his hourly wage will increase to $34 in August 2017. (Tr. 33-39.) He expressed an 
intention to clear his debts. (Tr. 28.) 
                                                 
5 Applicant testified that his monthly take-home pay is $3,600. (Tr. 59.) His take-home wage for 39.90 hours 
was $683.75 for the week ending May 20, 2017, so he may have overestimated his income. (AE G.) Assuming 
his spouse takes home $2,500 per month as he testified, they would appear to have enough to cover their 
monthly expenses. 
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 Applicant is repaying loans from his 401(k) at $52 and $28 per week. (AE G.) 
Applicant contributes ten percent of his pay every month to his 401(k), which has a balance 
of approximately $46,000. (Tr. 63.) His company matches up to four percent. (Tr. 77.) 
When asked why he had not adjusted his retirement contributions in light of his financial 
situation, Applicant responded, “I have no reason why. I’ve been wanting to make sure that 
I was setting myself up for the future, maybe struggling now. I wasn’t thinking about it.” (Tr. 
77.) 
 
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(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 the 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 
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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 articulated 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. 
 
 An applicant is not required to be debt free, but is required to manage his finances 
in a way as to exhibit sound judgment and responsibility. Applicant exhibited poor financial 
judgment by defaulting on a car loan and on two personal loans opened in 2014 and 
allowing a credit card debt to go to collections. While approximately $100 in deposit-related 
fees went to collection in 2015, it is unclear whether Applicant knowingly incurred that debt. 
Applicant’s record of loan and credit card delinquency is more than adequate to establish 
disqualifying conditions AG ¶ 19(a), “inability to satisfy debts,” and AG ¶ 19(c), “a history of 
not meeting financial obligations.” 
 
 Applicant has the burden of presenting evidence of explanation, extenuation, or 
mitigation to overcome the security concerns raised by his delinquent debts. Under the AG 
effective for any adjudication on or after June 8, 2017, a record of consumer delinquency 
may be mitigated under one or more of the following conditions under ¶ 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; 
 
(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; 
 
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(c) the person has received or is receiving 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; and 
 
(d) the individual initiated and is adhering to a good-faith effort to repay 
overdue creditors or otherwise resolve debts. 
 
 Applicant’s financial problems did not occur so long ago to enable a reasonable 
conclusion that they do not cast doubt on his current judgment and reliability. He has yet to 
arrange for repayment of his automobile loan deficiency balance or of the charged-off 
personal loan in SOR ¶ 1.b. AG ¶ 20(a) does not mitigate the security concerns raised by 
ongoing delinquency. 
 
 On his SF 86 and during his interview with an OPM investigator, Applicant attributed 
his financial difficulties to his spouse’s job loss in November 2014, which is a circumstance 
that could trigger AG ¶ 20(b). However, Applicant testified discrepantly that his spouse lost 
her job around August 2015, which is well after he defaulted on his credit card and loans in 
the SOR. Available credit reports show that he began falling behind on his car loan in June 
2014. While he brought the car loan current in September 2014, he made no subsequent 
payments before the loan was charged off around May 2015. His personal loan with the 
same credit union was charged off around March 2015. He made no payments on the 
personal loan in SOR ¶ 1.e or on the credit card debt in SOR ¶ 1.c after 2014. The 
evidence suggests that his and his spouse’s voluntary move to a house at rent of $1,300 
per month in September 2014 contributed to his financial problems. Neither Applicant nor 
his spouse could have foreseen the criminal act that prompted them to move. Even so, 
Applicant admitted that he overextended himself financially by taking on more loan debt in 
2014 than he could afford to repay on his income. Applicant had to borrow from his 401(k) 
to cover the first month’s rent and security deposit when he moved. His decision to take on 
three sizeable loans in 2014 was a significant cause of his financial distress. 
 
 Applicant and his spouse acted responsibly within AG ¶ 20(b) by moving to their 
current residence in April 2015 at a savings of $600 per month in rent. The loss of his 
spouse’s income around August 2015 is somewhat mitigating of his failure to take steps 
during that fall to address his debts that had recently been charged off for nonpayment. 
However, after his spouse regained employment in January 2016, Applicant elected to 
pursue a new career path at work, knowing that his income would be less during his initial 
nine-month training period. Given there was the prospect of higher income in this field in 
the near future, his decision was not unreasonable, but it was within his control. His tax 
payments to the IRS starting in May or June 2016 compromised his finances. Even so, he 
had an obligation to contact his creditors and attempt to arrange repayment terms. He is 
credited with satisfying the credit card debt in SOR ¶ 1.c in December 2016, but he did not 
act responsibly within AG ¶ 20(b) when he ignored his other delinquencies. Applicant did 
not contact the creditor in SOR ¶ 1.e until the week of May 21, 2017, and, as of the close 
of the record, he had yet to contact the collection entity now pursuing him for the auto loan 
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balance in SOR ¶ 1.a. AG ¶ 20(b) only partially mitigates the financial considerations 
security concerns. 
  
 AG ¶ 20(c) and AG ¶ 20(d) have some applicability because of Applicant’s 
satisfaction of the credit card delinquency in SOR ¶ 1.c in December 2016 and his post-
hearing payment of the $100 debt in SOR ¶ 1.d in June 2017. He also showed some good 
faith by arranging repayment terms for the personal loan in SOR ¶ 1.e. However, it would 
be premature to conclude that there are clear indications that his financial issues are under 
control. While he provided income and expense figures that would indicate he can afford 
the $200 monthly payments on the debt in SOR ¶ 1.e, he also testified that his and his 
spouse’s monthly expenditures usually exceed their income. They have identified some 
items, such as restaurant meals, to reduce their budget, but they do not always follow their 
budget. As of late May 2017, Applicant and his spouse had less than $100 in their joint 
checking account and nothing in savings. Despite his admitted financial struggles, 
Applicant was continuing to contribute ten percent of his pay to his 401(k). When asked 
why he had not reduced the percentage of his retirement contributions to alleviate his 
current financial pressures, Applicant testified that he had not given it any consideration. 
While he expects his hourly wage to increase to $34 in August 2017, and he expressed an 
intention to resolve his debts, promises to pay off delinquent debts in the future are not a 
substitute for a track record of paying debts in a timely manner and otherwise acting in a 
financially responsible manner. See, e.g., ISCR Case No. 14-04565 at 3 (App. Bd. Sep. 18, 
2015), citing ISCR 14-03069 at 3 (App. Bd. Jul. 30, 2015). Applicant has yet to arrange for 
repayment of the defaulted loans in SOR ¶¶ 1.a and 1.b. 
 
Whole-Person Concept 
 
In the whole-person evaluation, 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(d).6 Some of the factors in AG ¶ 2(d) were addressed under 
Guideline F, but some warrant additional comment. 
  
 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 under the whole-person 
concept, the Appeal Board has established that an applicant is not required to pay off 
every debt in the SOR: 
                                                 
6 The factors under AG ¶ 2(d) 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. 
 
10 
 
The Board has previously noted that the concept of a meaningful track 
record necessarily includes evidence of actual debt reduction through 
payment of debts. However, an applicant is not require, 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 demonstrate 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.  
 
See ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008) (internal citations and 
quotation marks omitted). As of the close of the record, Applicant had no repayment plan in 
place to resolve some $12,544 owed on the defaulted loans in SOR ¶¶ 1.a and 1.b. He 
had yet to make his first payment to address the $3,501 loan delinquency in SOR ¶ 1.e. 
While he testified credibly about his intention to resolve these past-due debts, something 
always seems to compromise his financial situation, such as his federal and state income 
tax liabilities. 
 
 Applicant’s past service in the U.S. military, including his deployments, and his 
candor about his financial situation, weigh in his favor. However, it is also 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). His financial problems are not sufficiently 
resolved. This decision should not be construed as a determination that Applicant cannot 
or will not show sufficient financial stability and a state of reform necessary to be eligible for 
a security clearance in the future. More progress is needed toward addressing his 
delinquent loans. For the reasons noted above, I conclude that it is not clearly consistent 
with the national interest to continue Applicant’s security clearance eligibility at this time. 
 
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.b:  Against Applicant 
Subparagraphs 1.c-1.d:  For Applicant 
  Subparagraph 1.e:   Against Applicant 
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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