DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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)         ISCR Case No. 17-00244
)
)
Applicant for Security Clearance )
Appearances
For Government: Robert B. Blazewick, Esq., Department Counsel
For Applicant: Pro se
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Decision
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MASON, Paul J., Administrative Judge:
Applicant’s unsupported statements that she is working on her debts, that she
plans to take out a loan from her retirement account, and that she intends to enroll in
financial counseling in the future does not mitigate the security concerns presented by
the financial considerations guideline. She has not overcome the personal conduct
concerns either. Eligibility for access to classified information is denied. 
Statement of the Case
On September 23, 2015, Applicant signed and certified an Electronic
Questionnaires for Investigations Processing (e-QIP). (Item 3) She was interviewed by
an investigator from the Office of Personnel Management (OPM) on June 23, 2016.
(PSI) (Item 6) A second telephone interview of Applicant was conducted on September
20, 2016. (item 6) On March 13, 2017, the Department of Defense (DOD) issued a
Statement of Reasons (SOR) detailing security concerns under financial considerations
(Guideline F). The action was taken under Executive Order 10865, Safeguarding
Classified Information within Industry (February 20, 1960), as amended; Department of
Defense Directive 5220.6, Defense Industrial Personnel Security Clearance Review
Program (January 2, 1992), as amended (Directive); and the adjudicative guidelines
(AG) dated June 8, 2017.  1
Applicant furnished her notarized answer to the SOR on April 4, 2017. A copy of
the Government’s File of Relevant Material (FORM), the Government’s evidence in
support of the allegations of the SOR, was sent to Applicant on May 17, 2017. She
received the FORM on May 24, 2017, and was instructed to file objections or submit
additional information within 30 days of receiving the FORM. On June 15, 2017,
Applicant’s handwritten response was forwarded to me without objection, and has been
entered into evidence.
Evidentiary Rulings
In a footnote on the second page of the FORM, Applicant was advised she could
make corrections to the June 2016 PSI to improve the exhibit’s clarity and accuracy.
Alternatively, she was advised that since the entire PSI was unauthenticated, she could
object to the exhibit and it would not be admitted into evidence. Applicant did not object,
and the June 2016 PSI is entered into the evidence. 
Findings of Fact
The SOR alleges nine debts and a Chapter 7 bankruptcy discharge under the
financial considerations guideline. The debts total $14,651. The debts became
delinquent between June 2013 and October 2015. Applicant admitted the listed debts
and the bankruptcy discharge. The SOR alleges under the personal conduct guideline
that she falsified her e-QIP on September 23, 2015, by answering “no” to all the
financial questions under Section 26 of the security form. Applicant admitted the
falsification, but then contended she made an honest mistake. Next, she indicated that
she knew the company was going to check and learn about the bankruptcy. The listed
debts in the SOR are based on a credit report dated October 2016, Applicant’s June
2016 PSI, her answer to the SOR, and her response to the FORM, admitting all the
listed debts and the August 2013 bankruptcy discharge. 
Applicant is 30 years old. She married in March 2016. She has a four-year-old
daughter. Since February 2007, she has been employed as a sheet metal worker for a
defense contractor. She took some college courses in 2011, but did not receive a
degree. 
Financial Considerations
In her June 2013 PSI, Applicant explained that her youth and financial
irresponsibility led to her filing a Chapter 7 bankruptcy petition in April 2013, and having
$68,164 in liabilities discharged in August 2013. (SOR ¶ 1.j) The accounts discharged
included credit cards, “payday loans,” an installment car loan, and a car rental account.
Applicant’s parents paid for the bankruptcy in order for her to get a fresh start on her
finances. Applicant intended to research the delinquent accounts that were not
discharged in the 2013 bankruptcy and pay the balances due. Though Applicant
indicated she never had financial or credit counseling, based on familiarity with the
 This case was decided using the new guidelines which became effective on June 8, 2017. These guidelines1
superseded the former guidelines which had been in effect since September 1, 2006. My decision in this case
would be the same under the 2006 or 2017 guidelines. 
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United States Bankruptcy Code, some kind of financial counseling is mandated by the
Code in order to file bankruptcy. (Item 5, 6)
In her June 2016 PSI, she explained that the federal tax lien (the largest
delinquent debt) amounting to $7,890 (SOR ¶ 1.i) was filed by the Internal Revenue
Service (IRS) in June 2013 to recover delinquent taxes that Applicant owes for federal
tax years 2011, 2012, and 2013. She claimed she was making plan payments of $158 a
month to the IRS. However, she indicated that she was unaware that a federal tax lien
was filed against her. In her June 2017 response to the FORM, and as discussed
below, she stated that she was trying to arrange a payment plan with the IRS. (Item 6)
Without documentary support verifying a payment plan, I find the lien is not being
resolved. 
The second largest listed debt of $1,835 represents an apartment lease balance
that Applicant owes for breach of a lease (SOR ¶ 1.a). In December 2013, Applicant
broke the apartment lease and moved to her sister-in-law’s residence to take advantage
of reduced rent. She claimed that two days before the PSI, the landlord-creditor
proposed a payment plan of $200 a month which she agreed to pay, but had not notified
the landlord. She did not know when the plan was to begin. (Item 6) The account is
unresolved. 
The other seven delinquent debts listed in the SOR, including a medical debt for
$38 (SOR ¶ 1.h), are unresolved. Applicant’s repeated statements in her answer of
working to pay the debts off are not credible because they are not supported by
documentation showing she paid the debt or made a payment under payment plan
toward satisfaction of the debt. Similarly, her statements in her June 2017 response to
the FORM that she has accepted or will accept settlement offers, are not credible either.
On the second page of Applicant’s June 2017 response to the FORM, she stated
an intention to withdraw a loan from her retirement account in 2018 to pay off all the
listed debts. She intends to enroll in a financial counseling program. Her claim that she
was negotiating a payment plan with the IRS contradicts her June 2016 and April 2017
statements that she was already participating in a payment plan. 
Personal Conduct
Applicant certified an e-QIP on September 23, 2015. She answered “no” to all
financial questions under Section 26 - Financial Record, including bankruptcy in the
last seven years. In her September 2016 telephone PSI, she claimed that she answered
“yes” to the bankruptcy question and did not know why a “no” answer appeared next to
the question. In her April 2017 answer to the SOR, she admitted the falsification, but
believed it was an honest mistake and contended that she must have “accidentally
checked no.” In the next sentence, Applicant explained that she was fully aware that an
ensuing investigation would confirm the bankruptcy. She did not explain why she did not
disclose the 2013 tax lien (SOR ¶ 1.i) or SOR ¶¶ 1.a, 1.g, and 1.h. The other listed
debts do not apply to the personal conduct allegation as they became delinquent on or
after September 23, 2015, the date Applicant certified and signed her e-QIP. (Answer to
SOR) 
Policies
When evaluating an applicant's suitability for a security clearance, the
administrative judge must consider the guidelines in the AG. Each guideline lists
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potentially disqualifying conditions and mitigating conditions that are useful in evaluating
an applicant's eligibility for access to classified information.
The administrative judge's ultimate goal is to reach a fair and impartial decision
that is based on sound and prudent judgment. The decision should also include a
careful, thorough evaluation of a number of general factors known as the "whole-person
concept" that brings together all available, reliable information about the person, past
and present, favorable and unfavorable, in making a decision. 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 the potential, rather than actual,
risk of compromise of classified information. 
Under Directive ¶ E3.l.14., the Government must present evidence to establish
controverted facts alleged in the SOR. Under Directive ¶ E3.l.l5., 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 bears the ultimate burden of persuasion in demonstrating that he warrants a
favorable security clearance decision. 
Analysis
Financial Considerations 
The security concern for financial considerations is 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. 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. 
A person who holds a security clearance has a fiduciary responsibility to comply
with all rules and regulations associated with the safeguarding of classified information.
This fiduciary duty extends to an applicant’s management of her finances. Common
sense and sound judgment should motivate a person seeking a security clearance to
responsibly manage her financial obligations by regularly paying voluntarily incurred
debts as they become due. When she encounters financial problems, she should seek
assistance from her employer or an outside financial counseling organization. 
The disqualifying conditions under AG ¶ 19 are: 
(a) inability to satisfy debts; and
(c) a history of not meeting financial obligations. 
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Based on delinquent debt information derived from the Government 2016 credit
report, Applicant’s answer to the SOR and her response to the FORM, Applicant
incurred delinquent debts between June 2013 and October 2015. When the SOR was
issued in March 2017, Applicant owed $14,651 and still owes that amount. Her history
of financial problems is accentuated by a Chapter 7 bankruptcy discharge in August
2013, followed by accrual of additional delinquent debt. AG ¶¶ 19(a) and 19(c) apply
Four mitigating conditions under AG ¶ 20 are potentially pertinent: 
(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 reliability, trustworthiness, and 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 identify theft), and the
individual acted responsibly under the circumstances; 
(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. 
After carefully considering the potential mitigating conditions, I conclude that
none apply. All of Applicant’s listed debts are still delinquent. The FORM contains no
evidence of unanticipated circumstances causing or contributing to Applicant’s financial
problems. While she received mandated financial counseling, there is no indication that
the counseling was beneficial as Applicant has accumulated more delinquent debt after
receiving a Chapter 7 discharge of more than $68,000 in liabilities in August 2013. Her
promise to participate in additional financial counseling in the future is not mitigating.
She provided no evidence to support a conclusion that she is making a good-faith effort
to resolve her debts. Her promise to take out a loan from her retirement account in the
future, just like her promise to take financial counseling, represent promises to act in the
future and do not mitigate her overall inaction heretofore. AG ¶¶ 20(a)-20(d) do not
apply.
Personal Conduct
The security concern for personal conduct is set forth in AG ¶ 15:
Conduct involving questionable judgment, lack of candor, dishonesty, or
unwillingness to comply with rules and regulations can raise questions
about an individual’s reliability, trustworthiness and ability to protect
classified information. Of special interest is any failure to provide truthful
and candid answers during the national security investigative or
adjudicative processes. The following will normally result in an unfavorable
national security eligibility determination, security clearance action, or
cancellation of further processing for national security eligibility: (15(a)and
(b)) omitted.
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The disqualifying condition under AG ¶ 16 is: 
(a) deliberate omission, concealment or falsification of relevant facts from
any personnel security questionnaire, personal history statement, or
similar form used to conduct investigations, determine employment
qualifications, award benefits or status, determine security clearance
eligibility or trustworthiness, or award fiduciary responsibilities.
When Applicant completed the e-QIP in September 2015, she did not disclose
her 2013 bankruptcy, her 2013 federal tax lien, or her two medical debts. While she may
have forgotten about the smaller medical debts, her array of contradictory explanations
for omitting the bankruptcy and federal tax lien are not credible. AG ¶ 16(a) applies.
The mitigating conditions under AG ¶ 17 are: 
(a) the individual made prompt good-faith efforts to correct the omission,
concealment, or falsification before being confronted with the facts; 
(c) the offense was so minor, or so much time has passed, or the behavior
is so infrequent, or it happened under such unique circumstances that it is
unlikely to recur and does not cast doubt on the individual’s reliability,
trustworthiness, or good judgment; and 
(d) the individual has acknowledged the behavior and obtained counseling
to change the behavior or taken other positive steps to alleviate stressors,
circumstances, or factors that caused untrustworthy, unreliable or other
inappropriate behavior, and such behavior is unlikely to recur.
None of the mitigating conditions apply. Applicant never voluntarily informed the
Government about her 2013 bankruptcy and federal tax problems until confronted with
them by the OPM investigator. Her falsification of the 2013 federal lien ($7,890) was
significant. The 2013 Chapter 7 bankruptcy discharge, which eliminated more than
$68,000 in liabilities, was a substantial event, giving Applicant a fresh start on her
finances. While she admitted the falsification, her explanations attempt to minimize her
intent to hide relevant information from the Government about her financial history. An
applicant seeking a security clearance is required to be candid during all phases of the
security investigation. 
Whole-Person Concept 
I have examined the evidence under the disqualifying and mitigating conditions of
the financial considerations and personal conduct guidelines. I have also weighed the
circumstances within the context of nine variables of the whole-person concept. In
evaluating the relevance of an individual's conduct, the administrative judge should
consider the following factors listed in 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 the
participation was 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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The final security clearance decision must be an overall commonsense judgment
based upon careful consideration of the specific guidelines, each of which is to be
evaluated in the context of the whole person. (AG ¶ 2(c))
In June 2013, a federal tax lien was filed against Applicant. In August 2013, she
received a Chapter 7 discharge of more than $68,000 in liabilities. After her 2013
discharge, Applicant incurred more delinquent debt. She has presented no evidence of
paying the federal tax lien or the other debts listed in the SOR. Her deliberate
concealment of her bankruptcy and federal tax lien, shows poor judgment and
untrustworthiness. Having weighed all the evidence in light of the specific conditions and
the whole-person concept, Applicant has not mitigated the security concerns arising
from the guidelines for financial considerations and personal conduct. See AG ¶ 2(a)(1)
through AG ¶ 2(a)(9).
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.j: Against Applicant
Paragraph 2 (Guideline E): AGAINST APPLICANT
Subparagraph 2.a: Against Applicant
Conclusion
In light of all of the circumstances presented by the record in this case, it is not
clearly consistent with national interest to grant Applicant eligibility for a security
clearance. Eligibility for access to classified information is denied. 
                      
Paul J. Mason
Administrative Judge
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