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DEPARTMENT OF DEFENSE 
DEFENSE OFFICE OF HEARINGS AND APPEALS 
           
             
 
 
In the matter of: ) 
 ) 
 [REDACTED] )  ISCR Case No. 16-00724 
 ) 
Applicant for Security Clearance ) 
 
 
Appearances 
 
For Government: Ross Hyams, Esq., Department Counsel 
For Applicant: Pro se 
 
 
______________ 
 
Decision 
______________ 
 
 
HESS, Stephanie C., Administrative Judge: 
 
 This case involves security concerns raised under Guideline F (Financial 
Considerations). Due to circumstances largely beyond his control, Applicant experienced 
financial difficulties. However, Applicant has resolved the majority of his delinquent 
accounts and mitigated the potential financial security concern. Eligibility for access to 
classified information is granted. 
 
Statement of the Case 
 
Applicant submitted a security clearance application (e-QIP) on August 25, 2015. 
On June 24, 2016, the Department of Defense (DOD) sent him a Statement of Reasons 
(SOR), alleging security concerns under Guideline F. The DOD acted under Executive 
Order (Ex. Or.) 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 (AG) implemented by the DOD on September 1, 2006.  
  
Applicant answered the SOR and requested a hearing before an administrative 
judge. Department Counsel was ready to proceed on August 24, 2016, and the case was 
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assigned to me on April 25, 2017. On May 4, 2017, the Defense Office of Hearings and 
Appeals (DOHA) notified Applicant that the hearing was scheduled for May 23, 2017. I 
convened the hearing as scheduled. Government Exhibits (GX) 1 through 3 were 
admitted in evidence without objection. He testified, submitted Applicant’s Exhibits (AX) 
A and B, which were admitted without objection, and called one witness. I kept the record 
open until June 6, 2017, to enable him to submit additional documentary evidence. DOHA 
received the transcript (Tr.) on June 2, 2017. 
 
The SOR was issued under the AG implemented on September 1, 2006. The DOD 
implemented the amended AG on June 8, 2017, while this decision was pending. This 
decision will be decided based on the amended AG effective June 8, 2017.  
 
Findings of Fact 
 
Applicant is a 43-year-old logistics analyst employed by a federal contractor since 
August 2015. He graduated from college in 1999, simultaneously earning an associate’s 
and a bachelor’s degree. While working full time, he completed a second bachelor’s 
degree in 2011. His 2011 degree qualified him for his current employment. He has a four-
year-old daughter for whom he provides monthly child support. This is his first application 
for a security clearance. (GX 1; GX 2.)  
 
The SOR alleges 16 debts totaling approximately $129,146. These debts include 
10 student loans totaling $124,778, a credit-card account, four medical accounts, and a 
consumer account. In his Answer, Applicant admits each of the student loans, and denies 
the other six debts. With his Answer, Applicant provided an explanation of the origin and 
status of each debt, and evidence of payment of several of the debts. The delinquent 
debts are reflected in Applicant’s September 2015 credit bureau report (CBR), listed on 
his e-QIP, and discussed in his personal subject interview (PSI) summary. (GX 2; GX 1; 
GX 3.) Applicant’s admissions are incorporated in my findings of fact. 
 
When Applicant graduated from college in 1999, he was unable to find a job in his 
field of study. He began working as an aquatics instructor in 1999, and currently maintains 
a lifeguard position as a part-time job. He returned to college as a part-time student in 
2003, with the intention of earning a more marketable degree. In 2006, while Applicant 
was still in college, his father suffered a debilitating medical event. Applicant became 
responsible for managing his parents’ and his own households, and providing financial 
support for his parents. Later in 2006, his father passed away, and Applicant’s 
responsibilities for his mother increased. Applicant’s student loans from his 1999 degree 
were deferred for several years. (Tr. 18-20.) 
 
For a period of several years, despite maintaining full-time jobs, Applicant did not 
earn enough money to meet his regular monthly financial obligations and make his 
student loan payments. He contacted the loan agencies after his deferments ended, and 
informed them of his difficult financial circumstances. (Tr. 26-27.) At some point prior to 
his current employment, a federal loan-servicing agency began garnishing Applicant’s 
wages. (Tr. 28.) Applicant’s wages are currently garnished at about $188 per bi-weekly 
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paycheck. (AX A.) Applicant submitted a request for loan consolidation to a federal loan-
servicing agency, which was confirmed in July 2016. In August 2016, Applicant submitted 
a request for an income-driven repayment plan to a federal-loan servicing agency. (AX 
B.) Applicant’s friend, a financial-aid officer, is assisting Applicant in his efforts to 
consolidate his loans and enter an income-based repayment plan. Applicant will enter 
and maintain a repayment plan, in addition to the current payments through garnishment, 
as soon as he is notified by the loan-servicing agencies that his friend is contacting on 
Applicant’s behalf. (Tr. 56-60.) 
 
When Applicant applied for his current job, he met with the facility security officer 
who recommended that Applicant obtain a CBR. He obtained a CBR in August 2015, 
which identified several delinquent accounts. He contacted the creditors, and between 
August and September 2015, he paid SOR debts 1.k, 1.m, 1.n, and 1.p. SOR debts 1.l 
and 1.o were not listed on his CBR but he has since paid SOR ¶ 1.o. (Tr. 39-40.) Applicant 
learned of SOR ¶ 1.l, a collection account for a $1,821 medical debt, from the investigator 
during his PSI. However, the investigator did not have any contact information for the 
collection agency or identifying information for the original creditor, and despite 
Applicant’s efforts, he has been unable to find any information to resolve this debt. He is 
willing to satisfy this debt. (Tr. 63.) 
 
Between Applicant’s full-time and part-time employment, he is able to maintain his 
monthly financial obligations, which include child support, daycare, and health insurance 
for his daughter, as well as life insurance for his mother. (Tr. 48.) He is current with his 
state and Federal tax obligations, and has not incurred any recent delinquent debt. He 
does not have any credit-card accounts. He has a 401(k) and pension with his part-time 
employment. (Tr. 64-65; Tr. 50.) Applicant’s testimony was straightforward, sincere, and 
credible. 
 
Applicant and his witness met in 2007 as members of a fraternal organization. 
Applicant’s witness stated that Applicant has a reputation as trustworthy, honest, and 
dependable. He further stated that Applicant is a hard worker who meets his financial 
responsibilities, is a dedicated father, and is an active and contributing member of the 
community. (Tr. 70-74.) 
 
Policies 
 
 “[N]o one has a ‘right’ to a security clearance.” Department of the Navy v. Egan, 
484 U.S. 518, 528 (1988). As Commander in Chief, the President has the authority to 
“control access to information bearing on national security and to determine whether an 
individual is sufficiently trustworthy to have access to such information.” Id. at 527. The 
President has authorized the Secretary of Defense or his designee to grant applicants 
eligibility for access to classified information “only upon a finding that it is clearly 
consistent with the national interest to do so.” Exec. Or. 10865, Safeguarding Classified 
Information within Industry § 2 (Feb. 20, 1960), as amended.  
 
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Eligibility for a security clearance is predicated upon the applicant’s meeting the 
criteria contained in the AG. These guidelines are not inflexible rules of law. Instead, 
recognizing the complexities of human behavior, an administrative judge applies these 
guidelines in conjunction with an evaluation of the whole person. An administrative 
judge’s overarching adjudicative goal is a fair, impartial, and commonsense decision. An 
administrative judge must consider all available and reliable information about the person, 
past and present, favorable and unfavorable. 
 
 The Government reposes a high degree of trust and confidence in persons with 
access to classified information. This relationship transcends normal duty hours and 
endures throughout off-duty hours. 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. 
 
Clearance decisions must be made “in terms of the national interest and shall in 
no sense be a determination as to the loyalty of the applicant concerned.”  See Exec. Or. 
10865 § 7. Thus, a decision to deny a security clearance is merely an indication the 
applicant has not met the strict guidelines the President and the Secretary of Defense 
have established for issuing a clearance. 
 
 Initially, the Government must establish, by substantial evidence, conditions in the 
personal or professional history of the applicant that may disqualify the applicant from 
being eligible for access to classified information. The Government has the burden of 
establishing controverted facts alleged in the SOR. See Egan, 484 U.S. at 531. 
“Substantial evidence” is “more than a scintilla but less than a preponderance.” See v. 
Washington Metro. Area Transit Auth., 36 F.3d 375, 380 (4th Cir. 1994). The guidelines 
presume a nexus or rational connection between proven conduct under any of the criteria 
listed therein and an applicant’s security suitability. See ISCR Case No. 92-1106 at 3, 
1993 WL 545051 at *3 (App. Bd. Oct. 7, 1993).  
 
 Once the Government establishes a disqualifying condition by substantial 
evidence, the burden shifts to the applicant to rebut, explain, extenuate, or mitigate the 
facts. Directive ¶ E3.1.15. An applicant has the burden of proving a mitigating condition, 
and the burden of disproving it never shifts to the Government. See ISCR Case No. 02-
31154 at 5 (App. Bd. Sep. 22, 2005).  
 
An applicant “has the ultimate burden of demonstrating that it is clearly consistent 
with the national interest to grant or continue his security clearance.” ISCR Case No. 01-
20700 at 3 (App. Bd. Dec. 19, 2002). “[S]ecurity clearance determinations should err, if 
they must, on the side of denials.” Egan, 484 U.S. at 531; see AG ¶ 2(b).  
 
 
 
 
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Analysis 
 
Guideline F, Financial Considerations 
 
The concern under this guideline 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…. 
 
This concern is broader than the possibility that an individual might knowingly 
compromise classified information in order to raise money. It encompasses concerns 
about an individual’s self-control, judgment, and other qualities essential to protecting 
classified information. An individual who is financially irresponsible may also be 
irresponsible, unconcerned, or negligent in handling and safeguarding classified 
information. See ISCR Case No. 11-05365 at 3 (App. Bd. May 1, 2012). 
  
The record evidence establishes two disqualifying conditions under this guideline: 
AG ¶ 19(a) (“inability to satisfy debts”) and AG ¶ 19(c) (“a history of not meeting financial 
obligations”). The following mitigating conditions are potentially applicable: 
 
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, a death, divorce or separation, 
clear victimization by predatory lending practices, or identity theft), and the 
individual acted responsibly under the circumstances; and 
 
AG ¶ 20(d): individual initiated and is adhering to a good-faith effort to repay 
overdue creditors or otherwise resolve debts. 
 
 The conditions that caused Applicant to fall behind on his financial obligations were 
largely beyond his control. Since graduating from college in 1999 until beginning work 
with his current employer in August 2015, Applicant was underemployed. He began 
providing financial support for his parents after his father’s debilitating medical event in 
2006, and continues to provide financial assistance to his mother. Applicant acted 
responsibly under the circumstances. Despite the hardship of returning to college in 2003 
to pursue a degree in a more marketable field, Applicant did so and now is employed in 
that field. Applicant has made a good-faith effort to pay or otherwise resolve his debts. 
He proactively obtained a CBR in August 2015, contacted the creditors for the listed 
delinquent accounts of which he had previously been unaware, and paid them. He has 
maintained contact with the student loan-servicing agencies, and made repeated efforts 
to consolidate his loans and enter repayment plans that are within his financial resources 
to maintain. He has been repaying a federal loan servicing agency $376 a month through 
garnishment since 2015. He maintains full-time and part-time employment. Applicant 
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does not have any credit-card accounts, and has not incurred any recent delinquent debt. 
He has a 401(k) and a pension plan. He is current with his ongoing financial and tax 
obligations, and lives within his means. His financial situation is not due to lack of self-
control, irresponsibility, or unwillingness to abide by rules and regulations. Applicant has 
responsibly managed his finances within his means, and is working in good faith to 
resolve his debt given his limited resources. AG ¶¶ 20(b) and 20(d) apply. 
 
Whole-Person Concept 
 
 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. In applying the whole-
person concept, an 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.  I have incorporated my comments under Guideline F in my whole-person 
analysis. Some of the factors in AG ¶ 2(d) were addressed under that guideline, but I 
have also considered the following: 
 
 Applicant sought and earned a second college degree in order to ensure a more 
secure financial future. He responsibly pays child support, health insurance, and daycare 
expenses for his daughter. He is an active member of his community. Applicant was 
straightforward, sincere, and credible in his testimony.  
 
 After weighing the disqualifying and mitigating conditions under Guideline F, and 
evaluating all the evidence in the context of the whole person, I conclude Applicant has 
mitigated the potential security concerns raised by his past financial issues. Accordingly, 
I conclude he has carried his burden of showing that it is clearly consistent with the 
national interest to grant him eligibility for access to classified information. 
 
Formal Findings 
 
As required by section E3.1.25 of Enclosure 3 of the Directive, I make the following 
formal findings on the allegations in the SOR: 
  
 Paragraph 1, Guideline F (Financial Considerations):  FOR APPLICANT 
 
  Subparagraphs 1.a through 1.p:    For Applicant 
 
 
 
 
 
 
 
 
 
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Conclusion 
 
 I conclude that it is clearly consistent with the national interest to grant or continue 
Applicant’s eligibility for a security clearance. Eligibility for access to classified information 
is granted. 
 
 
 
Stephanie C. Hess 
Administrative Judge