DEPARTMENT OF DEFENSE
         DEFENSE OFFICE OF HEARINGS AND APPEALS
          
            
In the matter of: )
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                                                                      )                                                             
        ------------------------------------                   )      ISCR  Case No.  17-04378           
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Applicant for Security Clearance )
Appearances
For Government: Jeff Nagel, Esq., Department Counsel
For Applicant:   Pro se
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 Decision
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WESLEY, Roger C., Administrative Judge:
Based upon a review of the pleadings and exhibits, I conclude that Applicant
mitigated the security concerns regarding his financial considerations. Eligibility for
access to classified information is granted. 
 
Statement of Case
On January 9, 2018, Department of Defense (DoD) Consolidated Adjudications
Facility (CAF) issued a Statement of Reasons (SOR) detailing reasons why DoD
adjudicators could not make the affirmative determination of eligibility for a security
clearance, and recommended referral to an administrative judge to determine whether a
security clearance should be granted, continued, denied, or revoked. The action was
taken under Executive Order (Exec. 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 (AGs), effective June 8, 2017, by
Directive 4 of the Security Executive Agent Directive (SEAD 4), dated December 10,
2016, entitled National Security Adjudicative Guidelines for all covered individuals who
require initial or continued eligibility for access to classified information or eligibility to
hold a sensitive position.   
Applicant responded to the SOR on February 2, 2018, and requested a hearing. 
The case was assigned to me on March 19, 2018, and scheduled for hearing on April 18,
2018. The Government’s case consisted of six exhibits (GEs 1-6) Applicant relied on one
witness (himself) and two exhibits. (AEs A-B) The transcript was received on May 1, 
2018.
Procedural Issues
Before the close of the hearing, Applicant requested the record be kept open to
permit him the opportunity to supplement the record with documented payments. For
good cause shown, Applicant was granted 14 days to supplement the record. 
Department Counsel was afforded two days to respond. Within the time permitted,
Applicant supplemented the record with a documented payment summary. Applicant’s
submission was admitted as AE C. 
Summary of Pleadings
Under Guideline F, Applicant allegedly accumulated seven delinquent debts
exceeding $14,000. Allegedly, these debts have not been addressed.  In his response to
the SOR, Applicant admitted each of the allegations without  explanations.
      Findings of Fact
Applicant is a 58-year-old electrician for a defense contractor who seeks a security
clearance. The allegations covered in the SOR and admitted by Applicant are
incorporated and adopted as relevant and material findings. Additional findings follow.
Background
Applicant married his first wife in June 1980 and divorced her in June 1999 and
has two adult stepchildren from this marriage. (GE 1) Applicant earned a high school
diploma in 1977 and reported no post-high school education credits. (GEs 1-2) He
enlisted in the Air Force (AF) in February 1979 and served nine years of active duty. (GEs
1-2; Tr. 32) He received an honorable discharge in June 1982. Between March 1985 and
March 1990, he served in the AF Active Reserve. (GEs 1-2) He continued his military
service with his state’s Air National Guard, reporting active reserve service between
October 1992 and November 1993 and an honorable discharge. (GE 2) Between
November 1993 and October 1998, Applicant served in the AF Active Reserve and
received an honorable discharge in October 1998.  (GE 1)
Since May 2007, Applicant has been employed by his current employer. (GEs 1-2)
Between June 2005 and May 2007, he was employed by a non-military employer as an
electrician. (GE 2) 
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Finances
Between July 2014 and June 2015, Applicant accumulated seven delinquent
accounts exceeding $14,000. (GEs 5-7) He attributed his delinquencies to relocation, 
reduced earnings, his insurance company’s failure to cover his SOR ¶ 1.a medical debt
associated to the repair of his broken leg, and his own failure to cover his co-pays on the
smaller medical debts. (GE 2; Tr. 33-35). Applicant has since paid or resolved by
payment plan all but one of the listed debts in the SOR (i.e, SOR debt ¶ 1.g for $25 that
he cannot locate). (AEs A-C; Tr. 31-32)  Debts paid in full are comprised of the following:
SOR debts ¶¶ 1.b for $367, 1.c for $196, 1.d for $123, 1.e for $90, and 1.f for $28. (AEs
A-C; Tr. 31, 36-39)
SOR debt ¶ 1.a covers a medical account that Applicant opened in April 2012. (GE
5). Until recently, Applicant had not addressed this account, and it remained delinquent
and outstanding. While Applicant assured he had entered into a repayment plan, he
provided no documentation of his plan. (AEs A-B; Tr. 31) He did, however, provide a brief
payment summary of creditors he has addressed and cited to the $100 payment he made
to the creditor in February 2018 as evidence of his good-faith efforts to settle the account.
(AE C) While a concrete payment plan detailing the payment arrangement and historical
accounting of the payments he claims to have made to creditor 1.a would have helped to
validate his payment arrangement with SOR creditor ¶ 1.a, his supplied payment
information on the only major debt he has not paid or otherwise resolved in full is enough
to warrant acceptance of his oral assurances.
Applicant assured that he would like to pay off his creditor 1.a medical debt and is
exploring the availability of home equity financing. (Tr. 37) Currently, he has no 401(k)
account or other retirement account to draw upon a this time. (Tr. 39) He keeps his other
accounts current and is putting aside monthly savings to cover any unforeseen debts that
arise. (Tr. 40)
 
Policies
                
       The SEAD 4, Appendix (App.) 4 lists guidelines to be used by administrative judges
in the decision-making process covering security clearance cases. These guidelines take
into account factors that could create a potential conflict of interest for the individual
applicant, as well as considerations that could affect the individual’s reliability,
trustworthiness, and ability to protect classified information. These guidelines include
conditions that could raise a security concern and may be disqualifying (disqualifying
conditions), if any, and many of the conditions that could mitigate security concerns.
These guidelines must be considered before deciding whether or not a security
clearance should be granted, continued, or denied. The guidelines do not require
administrative judges to place exclusive reliance on the enumerated disqualifying and
mitigating conditions in the guidelines in arriving at a decision. Each of the guidelines is to
be evaluated in the context of the whole person in accordance with App. A. AG ¶ 2(c)  
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In addition to the relevant AGs, administrative judges must take into account the
pertinent considerations for assessing extenuation and mitigation set forth in App. A, AG
¶ 2(d) of the AGs, which are intended to assist the judges in reaching a fair and impartial
commonsense decision based upon a careful consideration of the pertinent guidelines
within the context of the whole person. 
The adjudicative process is designed to examine a sufficient period of an
applicant’s life to enable predictive judgments to be made about whether the applicant is
an acceptable security risk. The following App A, AG ¶ 2(d) factors are pertinent: (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 chances; (7) the motivation for the conduct; (8) the potential for
pressure, coercion, exploitation, or duress; and (9) the likelihood of continuation or
recurrence.
 Viewing the issues raised and evidence as a whole, the following individual
guidelines are pertinent in this case:
Financial Considerations
       The Concern: 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 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 of
dependence. An individual who is financially overextended is at greater
risk of having to engage in illegal acts or otherwise questionable acts to
generate funds. . . .  AG ¶ 18.
Burden of Proof
By virtue of the principles and policies framed by the AGs, a decision to grant or
continue an applicant's security clearance may be made only upon a threshold finding
that to do so is clearly consistent with the national interest.  Because the Directive
requires administrative judges to make a commonsense appraisal of the evidence
accumulated in the record, the ultimate determination of an applicant's eligibility for a
security clearance depends, in large part, on the relevance and materiality of that
evidence. See United States, v. Gaudin, 515 U.S. 506, 509-511 (1995). As with all
adversarial proceedings, the judge may draw only those inferences which have a
reasonable and logical basis from the evidence of record. 
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The Government's initial burden is twofold: (1) it must prove by substantial
evidence any controverted facts alleged in the SOR, and (2) it must demonstrate that
the facts proven have a material bearing to the applicant's eligibility to obtain or maintain
a security clearance. The required materiality showing, however, does not require the
Government to affirmatively demonstrate that the applicant has actually mishandled or
abused classified information before it can deny or revoke a security clearance. Rather,
the judge must consider and weigh the cognizable risks that an applicant may
deliberately or inadvertently fail to safeguard classified information.
Once the Government meets its initial burden of proof of establishing admitted or
controverted facts, the evidentiary burden shifts to the applicant for the purpose of
establishing his or her security worthiness through evidence of refutation, extenuation,
or mitigation.  Based on the requirement of  Exec. Or. 10865 that all security clearances
be clearly consistent with the national interest, the applicant has the ultimate burden of
demonstrating his or her clearance eligibility. “[S]ecurity-clearance determinations
should err, if they must, on the side of denials.” See Department of the Navy v. Egan,
484 U.S. 518, 531 (1988). 
Analysis  
Security concerns are raised over Applicant’s accumulating delinquent medical
and consumer debts over a two-year period spanning July 2014 and June 2015. 
Applicant’s accumulation of delinquent medical and consumer accounts warrant the
application of three of the disqualifying conditions (DC) of the AGs: DC ¶ 19(a), “inability
to satisfy debts,” and DC ¶ 19(c), “a history of not meeting financial obligations.”
Holding a security clearance involves the exercise of important fiducial
responsibilities, among which is the expectancy of consistent trust and candor. 
Financial stability in a person cleared to access classified information is required
precisely to inspire trust and confidence in the holder of the clearance. While the
principal concern of a clearance holder’s demonstrated financial difficulties is
vulnerability to coercion and influence, judgment and trust concerns are also implicit in
financial cases.
Applicant’s addressing his listed medical and consumer debts merit the
application of several available mitigating conditions. His resolved debt delinquencies
permit him to meet the relevant Appeal Board’s requirements for demonstrating financial
stability. See ISCR Case No. 07-06482 (App. Bd. May 21 2008);  see also ISCR Case
No. 05-11366 at 4 n.9 (App. Bd. Jan. 12, 2007)(citing ISCR Case No. 99-0462 at 4
(App. Bd. May 25, 2000)); ISCR Case No. 99-0012 at 4 (App. Bd. Dec. 1, 1999). Except
for one small debt (creditor 1.g for $28), all of his listed creditors have either been paid
or are being resolved through a repayment plan with the creditor (i.e., creditor 1.a)
From a whole-person standpoint, Applicant’s contributions to the defense
industry are worthy of respect. Coupled with his positive repayment initiatives, they are
sufficient to overcome security concerns associated with his history of delinquent
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medical and consumer debts. Considering all of the circumstances surrounding
Applicant’s addressed delinquent debts, favorable conclusions are warranted with
respect to listed SOR debts  ¶¶ 1.a-1.g  of Guideline F.
Formal Findings
In reviewing the allegations of the SOR and ensuing conclusions reached in the
context of the findings of fact and the factors listed above, I make the following formal
findings:
GUIDELINE F (FINANCIAL CONSIDERATIONS):   FOR APPLICANT
Subparas. 1.a-1.g:       For Applicant
                           
 Conclusions
In light of all the circumstances presented by the record in this case, it is clearly
consistent with the national interest to grant or continue Applicant’s security clearance. 
Clearance is granted.
                                          
Roger C. Wesley
Administrative Judge 
                                        
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