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DEPARTMENT OF DEFENSE 
DEFENSE OFFICE OF HEARINGS AND APPEALS 
In the matter of: )
)
[REDACTED] ) ISCR Case No. 17-02567 
) 
Applicant for Security Clearance ) 
Appearances 
For Government: Ross Hyams, Esq., Department Counsel 
For Applicant: Pro se 
______________ 
Decision 
______________ 
HESS, Stephanie C., Administrative Judge: 
Applicant experienced financial difficulties due to circumstances largely beyond 
her control, but mitigated the concern by acting responsibly. Eligibility for access to 
classified information is granted. 
Statement of the Case 
Applicant submitted a security clearance application (e-QIP) on January 3, 2017. 
On August 23, 2017, the Department of Defense (DOD) sent her a Statement of Reasons 
(SOR), alleging security concerns under Guidelines F (Financial Considerations). 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) effective June 8, 2017.  
Applicant submitted her Answer to the SOR on September 18, 2017, and 
requested a hearing before an administrative judge. Department Counsel was ready to 
proceed on November 1, 2017, and the case was assigned to me on March 20, 2018. On 
May 22, 2018, the Defense Office of Hearings and Appeals (DOHA) notified Applicant 
03/19/2019
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that the hearing was scheduled for June 6, 2018. I convened the hearing as scheduled. 
Government Exhibits (GX) 1 through 3 were admitted into evidence without objection. 
Applicant testified and Applicant’s Exhibits (AX) A through D were admitted without 
objection. I left the record open until June 20, 2018, to enable Applicant to submit 
additional documentary evidence. She timely submitted AX E and F, which I have 
admitted without objection. DOHA received the transcript (Tr.) on June 14, 2018. 
 
Findings of Fact 
 
Applicant is a 38-year-old supplier-diversity-specialist currently employed by a 
defense contractor since February 2015. She earned her bachelor’s degree in 2008 and 
her juris doctor in 2013. This is her first application for security clearance. (GX 1.)  
 
Under Guideline F, the SOR alleges 22 past-due accounts totaling $17,762, 19 of 
which are past-due medical accounts totaling $10,517. In her Answer, Applicant admits 
each of the debts and explains their origin and current status. The delinquent debts are 
reflected in Applicant’s credit bureau report (CBR) from April 2017, discussed during her 
personal subject interview (PSI) from May 2017, and many are listed on her e-QIP from 
January 2017. (GX 3; GX 2; GX 1.)  
 
 In 2012, Applicant was in law school, working a part-time job, and living at home 
with her mother and two younger siblings. Her mother became gravely ill, and was no 
longer able to work. Applicant used her meager earnings and took additional student 
loans to pay the family’s living expenses, including the mortgage. Applicant fell behind on 
the payments on her two credit-card accounts that she had opened during college. 
Additionally, Applicant was unable to afford health insurance. She began experiencing 
medical issues and was diagnosed with an illness that required frequent blood screening 
and sometimes required hospitalization. She amassed significant medical debt which she 
was unable to pay due to the expenses of maintaining the family’s household. (Tr. 16-
19.) 
 
 After graduating from law school, Applicant worked as a law clerk from September 
2013 until August 2014. She worked on a campaign for a senator from September 2014 
until December 2014. Applicant experientially benefited from these two jobs, but they 
were not lucrative. She was unemployed from December 2014 until she started her 
current job in February 2015, which required her to move to another state. Applicant took 
out a loan to help with moving expenses, including the requisite down-payment on an 
apartment of first and last month’s rent and a security deposit, which was approximately 
$3,600. She had a long commute and spent a significant amount each month on gas and 
tolls. At the end of 2016, Applicant was required by her employer to again relocate. She 
took another loan to cover moving expenses. She completed repaying the two moving-
related loans in March 2017. (Tr. 38-39.) Her student loans are in good standing. (Tr. 40.) 
 
 Applicant then started addressing her delinquent debt. Her ongoing plan is to pay 
off the smaller debts first and progress to the largest one. Applicant paid the $160 medical 
debt alleged in SOR ¶ 1.p. (AX B.) She settled-in-full the $2,286 delinquent credit-card 
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debt alleged in SOR ¶ 1.a and the $524 medical debt alleged in SOR ¶ 1.q. (AX A; AX 
D.) She entered a repayment plan in July 2017 with the medical creditor of SOR ¶¶ 1.b, 
1.c, and 1.r. She has satisfied SOR ¶¶ 1.b - $122 and 1.c - $35, and owes approximately 
$1,093 on the $1,308 account alleged in SOR ¶ 1.r. (Tr. 24-25.) She has 16 monthly 
payments of $55 remaining on her repayment plan with the creditor of SOR ¶ 1.p, a 
delinquent credit card originally $1,318 and now $823. (AX C.) 
 
 The creditor of the $3,641 credit-card debt alleged in SOR ¶ 1.o sought a default 
judgment which was entered against Applicant in 2016. Applicant’s friend, an attorney, 
successfully petitioned to have the judgment vacated because Applicant was never 
served with notice. The attorney is now negotiating with the creditor on Applicant’s behalf 
and is attempting to reach a settlement agreement. (AX E; Tr. 22-23.) 
 
 The $102, $166, and $108 medical debts alleged in SOR ¶¶ 1.e, 1.f, and 1.g are 
in collection with the same creditor. The $200, $40, and $65 debts are in collection with 
another creditor. Applicant contacted the creditors to verify that the accounts were hers. 
Applicant stated that she intended to enter repayment agreements with these two 
creditors in July 2018. (Tr. 26-28.) 
 
 The remaining accounts, SOR ¶¶ 1.l through 1.n and 1.s through 1.v, totaling 
$7,473 were incurred when Applicant had to be hospitalized for her medical condition and 
was uninsured. Applicant will contact this creditor as soon as she is financially able to 
enter into a repayment plan, which she anticipated would be the end of 2018. (Tr. 27-29.) 
 
Applicant now earns approximately $73,000 annually in salary. (Tr. 38.) She lives 
within her means and has not incurred any delinquent debt since 2014. (GX 3; Tr. 41-42.) 
Applicant’s direct supervisor of over three years, who is aware of the nature of the SOR 
allegations, highly recommends Applicant for a security clearance, stating that she is 
trustworthy and that her most recent performance evaluation rated her as overall 
exceeding expectations. (AX F.) Applicant was candid, sincere, and credible while 
testifying. 
 
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.  
 
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 
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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 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. An individual who is financially overextended 
is at risk of having to engage in illegal acts to generate funds…. 
 
 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 following disqualifying conditions apply: 
 
 AG ¶ 19(a): inability to satisfy debts; and  
 
 AG ¶ 19(c): a history of not meeting financial obligations.  
 
 The relevant mitigating conditions in this case are: 
 
AG ¶ 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; 
 
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. 
 
 Applicant’s financial difficulties arose due to conditions largely beyond her control. 
Specifically, Applicant’s mother became extremely ill in 2012 and was unable to work. 
Applicant, a law student with a part-time job, became responsible for the household 
expenses, including the mortgage, for her mother’s house where her mother, her two 
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younger siblings, and she resided. Applicant used her earnings and additional student 
loans to cover these expenses. She fell behind on her personal credit-card accounts, and 
was unable to afford health insurance. Applicant began experiencing medical issues 
which required numerous treatments, including periods of hospitalization. She incurred 
significant medical debt. Applicant’s first two jobs after graduating from law school were 
low-paying. In order to begin work at her current employer in February 2015, Applicant 
was required to move. She took out a loan to cover the moving-related expenses. At the 
end of 2016, while she was still paying off the loan for the moving-related expenses, 
Applicant’s employer required her to move again. Applicant took a second loan to cover 
moving-related expenses. She completed repaying these two loans in March 2017, and 
immediately began to address her delinquent debts. Applicant established and instituted 
a plan to pay her smaller debts first, then progress to the repayment of her largest debt. 
She has resolved six SOR debts, is paying one debt, and has contacted the two creditors 
of six of the debts with the intention of establishing repayment plans in July 2018. The 
judgment entered against her has been vacated and an attorney is working on reaching 
a settlement agreement on Applicant’s behalf. She stated her intention to contact the 
remaining unaddressed SOR creditor, who is collecting for seven debts, before the end 
of 2018. She has not incurred any delinquent debts since 2014, and lives within her 
means. Her student loans are in good standing. 
  
 “Good faith” means acting in a way that shows reasonableness, prudence, 
honesty, and adherence to duty or obligation. ISCR Case No. 99-0201, 1999 WL 1442346 
at *4 (App. Bd. Oct. 12, 1999). A security clearance adjudication is an evaluation of a 
person’s judgment, reliability, and trustworthiness. It is not a debt-collection procedure. 
ISCR Case No. 09-02160 (App. Bd. Jun. 21, 2010). A person is not required to 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. The 
adjudicative guidelines do not require that a person make payments on all delinquent 
debts simultaneously, nor do they require that the debts alleged in the SOR be paid first. 
See ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008). 
  
 Applicant’s financial difficulties are not due to reckless spending or irresponsible 
behavior and did not arise under circumstances that cast doubt on her current reliability, 
trustworthiness, or good judgment. By addressing her debts in a responsible manner, 
Applicant has taken proactive steps to ensure ongoing financial stability. Although her 
financial record is not perfect, she has implemented a reasonable plan to resolve her 
financial issues within her means, and to avoid future financial difficulties. AG ¶¶ 20(a), 
20(b), and 20(d) apply. 
 
Whole-Person Concept 
 
 Under AG ¶ 2, 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 in light 
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of the nine adjudicative process factors listed at AG ¶ 2. I have incorporated my comments 
under Guideline F in my whole-person analysis.  
 
 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 security concerns raised by her delinquent debts. Accordingly, I conclude 
she has carried her burden of showing that it is clearly consistent with the national interest 
to grant her 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 – 1.v:    For Applicant 
    
Conclusion 
 
 I conclude that 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. 
 
 
 
Stephanie C. Hess 
Administrative Judge