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        DEPARTMENT OF DEFENSE 
         DEFENSE OFFICE OF HEARINGS AND APPEALS 
In the matter of: ) 
)
) ISCR Case No. 17-02626 
)
Applicant for Security Clearance ) 
Appearances 
For Government: Tovah Minster, Esq., Department Counsel 
For Applicant: Pro se 
______________ 
Decision 
______________ 
GARCIA, Candace Le’i, Administrative Judge: 
Applicant mitigated the financial considerations security concerns. Eligibility for 
access to classified information is granted.  
Statement of the Case 
On August 18, 2017, the Department of Defense (DOD) issued a Statement of 
Reasons (SOR) to Applicant detailing security concerns under Guideline F (financial 
considerations). 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 
(AG) implemented by DOD on June 8, 2017. 
Applicant responded to the SOR on September 13, 2017, and requested a 
hearing before an administrative judge. The case was assigned to me on April 13, 2018. 
The Defense Office of Hearings and Appeals (DOHA) issued a notice of hearing on 
April 25, 2018, scheduling the hearing for May 21, 2018. I convened the hearing as 
scheduled. 
01/04/2019
 
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I appended to the record, as Hearing Exhibits (HE) I and II, the Government’s 
discovery letter and exhibit list. Government Exhibits (GE) 1 through 5 were admitted in 
evidence without objection. Applicant testified and submitted Applicant Exhibits (AE) A 
and B, which were admitted in evidence without objection.                                                                      
 
At Applicant’s request, and with no objection from the Government, I left the 
record open until June 4, 2018, for Applicant to submit additional documentation. 
Applicant timely submitted additional evidence, which I collectively marked as AE C and 
admitted in evidence without objection. I marked as HE III the Government’s email 
indicating no objection to AE C. DOHA received the hearing transcript (Tr.) on June 6, 
2018.  
 
Findings of Fact 
 
 Applicant admitted all of the SOR allegations except ¶ 1.f. He is 36 years old. He 
graduated from high school in 2000, and he attended some college, but did not earn a 
degree. He is married. He has one stepchild and two children; all are minors.1 
 
 Applicant has worked for various DOD contractors since 2001. He has worked as 
a courier and support-service specialist for his current employer, a DOD contractor, 
since March 2018. He has held a security clearance since 2001.2  
   
 The SOR alleges ten delinquent consumer accounts totaling $12,631 (SOR ¶¶ 
1.a - 1.c, 1.f - 1.l) and one delinquent medical debt for $153 (SOR ¶ 1.d). It also alleges 
that Applicant filed chapter 7 bankruptcy in 2008 and received a discharge in 2009 
(SOR ¶ 1.e). The allegations are established by Applicant’s admissions, credit reports 
from November 2015, July 2017, and May 2018, and Applicant’s bankruptcy record. 
Applicant also disclosed and discussed his debts and his bankruptcy on his 2015 
security clearance application (SCA) and during his 2017 background interview.3  
 
 Applicant attributed his delinquent debts and his bankruptcy to the following 
factors: (1) medical expenses incurred after a 2001 car accident; (2) moving costs 
incurred in 2006; (3) burial expenses of $900 in 2008 and 2010; (4) $1,500 in 
unauthorized charges that he incurred around 2010 when his identity was stolen; (5) he 
was the primary breadwinner after his marriage in 2011 through the birth of his children 
in 2012; (6) he assisted his mother with paying for her medication in February and 
March 2018; and (7) he has assisted with caring for his grandmother. Despite these 
factors, he traveled overseas for tourism in 2009 and 2015. He testified that by the time 
of his 2017 background interview, he was already in the process of trying to resolve 
some of his delinquent accounts, to include SOR ¶¶ 1.b and 1.c. He also testified that 
                                                     
1 Tr. at 7-8, 11, 28-29, 78; GE 1, 2. 
 
2 Tr. at 5-6, 25-28; GE 1, 2; AE C. 
 
3 GE 1-5; AE C. 
 
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he had scheduled payments in September 2017 to resolve some of the SOR debts, as 
further discussed below.4  
 
  SOR ¶ 1.a is for a $10,321 charged-off auto loan account for Applicant’s used 
car which was purchased in 2009 and voluntarily repossessed in 2011. He became 
delinquent because he did not have the money to pay for necessary repairs. He 
established a $200 monthly payment plan in September 2017 that was scheduled to 
begin in October 2017 and continue through September 2020. With the exception of 
missing two monthly payments in February and March 2018, he testified that he has 
otherwise abided by the plan. He did not provide documentation to corroborate his claim 
of payments for this debt.5 
 
 SOR ¶ 1.b is for a $651 delinquent auto account that Applicant cosigned for his 
wife. He testified that he was unsure why the account became delinquent because she 
was responsible for paying it. He testified that she brought the account current in 
December 2017, and he expected that the account would be fully paid by September 
2018. His most recent credit reports from May 2018 corroborate his claim that this 
account is current.6   
 
 SOR ¶ 1.c is for a $574 charged-off credit card. Applicant testified that he 
established a monthly payment plan in September 2017, and he paid this debt by 
November 2017. His most recent credit reports from May 2018 corroborate his claim.7 
 
 SOR ¶ 1.d is for a $153 delinquent medical account. Applicant was unsure about 
the origin of this debt, but he testified that he paid it in full in September 2017. He did 
not provide documentation to corroborate his claim of payment. While this debt was 
reported on his 2015 and 2017 credit reports, it was no longer reported on his most 
recent credit report from 2018.8 
 
 SOR ¶ 1.f is for a $562 delinquent cable account. Applicant denied this debt. He 
testified that he has not had an account with this cable company since 2006, when he 
ended service with the company and returned the associated equipment. He testified 
that he unsuccessfully attempted to contact the company in September 2017 to dispute 
the account, and he intended to re-contact the company to close out any outstanding 
accounts. He had not yet disputed the account through the credit bureaus. While this 
debt was reported on his 2015 credit report, it was no longer reported on his most 
recent credit reports from 2017 and 2018.9 
                                                     
4 Tr. at 30-32, 51, 56, 60-62, 69-72; GE 1, 2. 
 
5 Tr. at 29-33, 51-52, 62-65, 70-71; GE 2, 3, 4; AE A, C. 
 
6 Tr. at 33-34, 62-65, 69-72; AE C. 
 
7 Tr. at 34-35, 51, 62-65, 69-72; GE 3; AE C. 
 
8 Tr. at 35-37, 62-67; GE 3, 4; AE C. 
 
9 Tr. at 37-39, 62-68; GE 3, 4; AE C. 
 
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 SOR ¶¶ 1.g through 1.l are for six traffic tickets totaling $523. Applicant testified 
that he called the parking authority and paid $462 to resolve all of his outstanding 
tickets. He provided documentation corroborating his payment.10 
 
 SOR ¶ 1.e is for Applicant’s Chapter 7 bankruptcy filed in 2008 and discharged in 
2009. He listed liabilities totaling $25,692. Applicant testified that he was advised to file 
bankruptcy because of his inability to pay around $25,000 in medical bills that he 
incurred after a 2001 car accident. He acknowledged that he included a personal loan 
and another car loan in his bankruptcy.11 
 
 Applicant testified that he does not have any other delinquent debts. He indicated 
that he consolidated $25,000 in student loans, which he was paying at $300 monthly. 
His May 2018 credit reports reflect that he has two student loans in collection for $1,001 
and $1,404, respectively. He testified that he received financial counseling as part of his 
2008 bankruptcy, and his church pastor was also assisting him with getting his finances 
together. He indicated that he and his wife enrolled with a credit-counseling company in 
May 2018. He intended to clean up his credit report, to include $1,500 in charges that 
he incurred in 2010 when his identity was stolen, though he received reimbursement by 
his bank for such unauthorized charges.12  
 
 Applicant indicated that he and his wife manage their finances together. He 
provided a copy of their monthly budget, reflecting a monthly net remainder of 
approximately $1,500, which can vary depending on changes to their expenses that can 
occur during certain times in the year. He testified that while they are able to meet their 
monthly expenses, at times they are overextended by around $500. He testified that he 
has a 401k retirement savings account of around $600, and he believes his wife also 
has such an account though he did not know the balance. He testified that he has 
always received favorable ratings on his performance evaluations. He provided 
documentation to show that he received numerous certificates of appreciation from his 
employers over the years. His current annual income is approximately $60,000, from 
$18,000 in 2001, which included a recent pay raise.13 
 
Policies 
 
 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 to be used in evaluating an 
applicant’s eligibility for access to classified information. 
 
                                                     
10 Tr. at 39-40, 65-66; GE 4; AE B. 
 
11 Tr. at 40-42, 68-69; GE 1, 2, 3, 4, 5; AE C. 
 
12 Tr. at 42-80; GE 2; AE C. 
 
13 Tr. at 42-80; GE 2; AE C. 
 
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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 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 the national security.”  
 
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.” 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 the applicant may deliberately or inadvertently fail to safeguard 
classified information. Such decisions entail a certain degree of legally permissible 
extrapolation of potential, rather than actual, risk of compromise of classified 
information. 
 
Section 7 of Exec. Or. 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 Exec. Or. 12968, Section 3.1(b) (listing multiple 
prerequisites for access to classified or sensitive information).   
 
Analysis 
 
Guideline F, Financial Considerations 
 
The security concern 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 
 
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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 . . . . 
 
The guideline notes several conditions that could raise security concerns under 
AG ¶ 19. The following are potentially applicable in this case:  
  
(a) inability to satisfy debts; and 
 
(c) a history of not meeting financial obligations. 
 
 Applicant was unable to pay his debts. The evidence is sufficient to raise AG ¶¶ 
19(a) and 19(c) as disqualifying conditions.  
 
  Conditions that could mitigate the financial considerations security concerns are 
provided under AG ¶ 20. The following are potentially applicable:  
 
(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; and 
 
(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. 
 
Conditions beyond Applicant’s control, as previously discussed, contributed to his 
financial problems. Thus, the first prong of AG ¶ 20(b) applies. For the full application of 
AG ¶ 20(b), he must provide evidence that he acted responsibly under his 
circumstances. He filed and received a Chapter 7 bankruptcy discharge once, after he 
incurred significant medical costs from a 2001 car accident that he could not afford to 
pay on his limited income. He also provided documentation to show that he resolved 
 
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SOR ¶¶ 1.b, 1.c, and 1.g. through 1.l. AG ¶ 20(b) applies to his past bankruptcy and 
these eight debts.  
 
Applicant did not provide documentation to corroborate his claims of payment 
for SOR ¶¶ 1.a, 1.d, and 1.f. However, he indicated that he paid SOR ¶ 1.d, he 
intended to re-contact the creditor for SOR ¶ 1.f to dispute and close out any 
outstanding accounts, and neither SOR debts are reported on his recent credit reports. 
I find that AG ¶¶ 20(b) and 20(e) apply as to SOR ¶¶ 1.d and 1.f.  
 
While Applicant did not provide documentation to corroborate his claims of 
payment for SOR ¶ 1.a, he indicated that he was in the process of paying it. He also 
indicated that he was working with his pastor and a credit-counseling company to 
resolve any remaining delinquent accounts. A security clearance adjudication is an 
evaluation of an individual’s judgment, reliability, and trustworthiness. It is not a debt-
collection procedure. See ISCR Case No. 09-02160 (App. Bd. Jun. 21, 2010). The 
adjudicative guidelines do not require that an individual make payments on all 
delinquent debts simultaneously, pay the debts alleged in the SOR first, or establish 
resolution of every debt alleged in the SOR. He or she need only establish a plan to 
resolve financial problems and take significant actions to implement the plan. See 
ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008). 
  
As such, there is sufficient evidence to conclude that Applicant acted responsibly 
under his circumstances to address his delinquent debts. His finances are under control 
and there is sufficient evidence to conclude that his financial problems are unlikely to 
recur. His debts do not cast doubt on his current reliability, trustworthiness, and good 
judgment. AG ¶¶ 20(a), 20(c), 20(d) are established as to SOR ¶¶ 1.a through 1.l. 
 
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.        
 
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I considered the potentially disqualifying and mitigating conditions in light of all 
the 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 
without questions and doubts as to Applicant’s eligibility and suitability for a security 
clearance. I conclude Applicant 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 section E3.1.25 of Enclosure 3 of the Directive, are: 
 
 Paragraph 1, Guideline F:    FOR APPLICANT 
 
Subparagraph 1.a – 1.l:    For Applicant 
 
Conclusion 
 
 In light of all of the circumstances presented by the record in this case, it is 
clearly consistent with the national interest to grant Applicant’s eligibility for a security 
clearance. Eligibility for access to classified information is granted. 
 
 
 
________________________ 
Candace Le’i Garcia 
Administrative Judge