CASEClearance Adjudication Search EngineCASE

Loading case…

ISCR Case 08-01501.h1 — CASE

ISCR Case 08-01501.h1denied

Case Headnote

ISCR Case No. 08-01501.h1

deniedApr 8, 2009· Hon. Elizabeth M. Matchinski· hearing

Summary

A 31-year-old environmental safety and occupational health engineer was denied a security clearance under Guideline F, Financial Considerations. The denial stemmed from significant delinquent debts totaling $55,872, which raised concerns about her reliability and trustworthiness.

The Statement of Reasons detailed numerous outstanding debts, including $11,663 and $8,295 in credit card debts, $8,701 for an automobile loan, and $9,449 in retail charge card debt. Other debts included various medical bills, apartment rental debt, and a past-due university debt, ranging from $35 to $1,402.

Despite some efforts to address her financial issues, the judge found that the applicant's financial problems were not fully resolved, and she remained under a substantial debt burden. This history of financial irresponsibility led to questions about her judgment and reliability, ultimately resulting in the denial of her security clearance.

Why the Applicant Was Denied

The applicant has a total of $55,872 in delinquent debt, raising significant security concerns.
The applicant's financial issues were not fully resolved, and she remains under a substantial debt burden.
The applicant's history of financial irresponsibility raises questions about her judgment and reliability.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
AG ¶ 19(c)raisedHistory of Not Meeting Financial Obligations
AG ¶ 19(e)raisedConsistent Spending Beyond One’s Means

Mitigating

AG ¶ 20(a)rejectedBehavior Occurred Long Ago or Under Circumstances Unlikely to RecurThe applicant's financial issues are ongoing and have not been fully resolved.
AG ¶ 20(b)rejectedConditions Largely Beyond the Person's ControlWhile some conditions were beyond her control, the applicant's current financial situation remains problematic.

Key Rule Quoted

“"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."”

Procedural Posture

SOR issuedSep 24, 2008
Answer filedSep 29, 2008
Hearing heldJan 9, 2009
Decision dateApr 8, 2009

Cite For

Denial of Security Clearance Due to Significant Financial Issues Under Guideline F
Impact of Unresolved Debts on Security Clearance Eligibility
Consideration of Financial History in Assessing Reliability and Trustworthiness

Editorial summary generated for research. Not legal advice; not a prediction. Verify against the full decision before relying on any quoted language.

Standardized Decision Profile

SEAD-4 Guideline F · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The judge found significant financial concerns under Guideline F, determining that the applicant owed a total of $55,872 in delinquent debts. While some debts were admitted and others disputed, the overall financial situation was deemed insufficiently mitigated, leading to a denial of the security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	$11,663 credit card debt in collection $11,663	Against Applicant	Credit Card Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	$500 medical debt in collection $500	For Applicant	Medical Debt	Denied	—	—	—
1.c	$35 medical debt in collection $35	For Applicant	Medical Debt	Denied	—	—	—
1.d	$713 apartment rental debt in collection $713	For Applicant	Unspecified Financial	Denied	—	—	—
1.e	$220 medical debt in collection $220	Against Applicant	Medical Debt	Unknown	(a) inability to satisfy debts	—	—
1.f	$8,295 credit card debt charged off $8,295	Against Applicant	Credit Card Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	$486 credit card debt in collection $486	Against Applicant	Credit Card Debt	Unknown	—	—	—
1.h	$1,402 retail charge card debt in collection $1,402	For Applicant	Credit Card Debt	Unknown	—	—	—
1.i	$3,107 credit card debt in collection $3,107	For Applicant	Credit Card Debt	Unknown	—	—	—
1.j	$9,449 retail charge card debt in collection $9,449	Against Applicant	Credit Card Debt	Unknown	—	—	—
1.k	$149 collection debt $149	For Applicant	Unspecified Financial	Unknown	—	—	—
1.l	$1,134 debt to university past due $1,134	For Applicant	Unspecified Financial	Denied	—	—	—
1.m	$8,701 automobile loan debt in collection $8,701	Against Applicant	Auto Loan Debt	Unknown	(a) inability to satisfy debts	—	—
1.n	$175 collection debt $175	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.o	$87 collection debt $87	For Applicant	Unspecified Financial	Unknown	—	—	—
1.p	$8,777 credit card debt in collection $8,777	Against Applicant	Credit Card Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.q	$979 retail charge debt in collection $979	Against Applicant	Credit Card Debt	Unknown	—	—	—

Descriptive standardized rendering of a decided public case (Guideline F). The verbatim source decision is shown in full below.

Full decision

The complete, official text — footnotes and signatures included — is in the original PDF.

Decision text, by section

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

APPEARANCES

DEPARTMENT OF DEFENSE DEFENSE OFFICE OF HEARINGS AND APPEALS

In the matter of: ) ) ------------------------- ) ISCR Case No. 08-01501 SSN: ----------------- ) ) Applicant for Security Clearance )

For Government: Eric H. Borgstrom, Esquire, Department Counsel For Applicant: Pro se

April 8, 2009 ______________

STATEMENT OF CASE

______________

MATCHINSKI, Elizabeth M., Administrative Judge:

Applicant submitted an Electronic Questionnaire for Investigations Processing (e- QIP) on June 28, 2006. On September 24, 2008, the Defense Office of Hearings and Appeals (DOHA) issued a Statement of Reasons (SOR) to Applicant detailing the security concerns under Guideline F that provided the basis for its decision to deny her a security clearance and refer the matter to an administrative judge. 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 revised adjudicative guidelines (AG) promulgated by the President on December 29, 2005, and effective within the Department of Defense as of September 1, 2006.

Applicant acknowledged receipt of the SOR on September 29, 2008. She submitted an undated written answer to the SOR and requested a hearing. The case was assigned to me on November 17, 2008, to conduct a hearing and to determine whether it is clearly consistent with the national interest to grant or continue a security clearance for Applicant. On November 21, 2008, Applicant requested that her hearing be held in mid to late January 2009, to give her more time to prepare. On December 16, 2008, I scheduled a hearing for January 9, 2009.

I convened the hearing as scheduled. Five government exhibits (Ex. 1-5) and seven Applicant exhibits (Ex. A-G) were admitted. Applicant and one witness, a family friend who holds a high position with Applicant’s employer, testified on her behalf, as reflected in a transcript (Tr.) received on January 28, 2009. Based on a review of the SOR, Answer, transcript, and documentary exhibits, eligibility for access to classified information is denied.

FINDINGS OF FACT

DOHA alleged under Guideline F, financial considerations, that Applicant owes delinquent debt totaling $55,872 (SOR ¶¶ 1.a through 1.q). Applicant denied the debts alleged in SOR ¶¶ 1.c, 1.d, 1.k, 1.l, and 1.o, totaling about $2,118. She admitted the other debts. After considering the evidence of record, I make the following findings of fact.

Applicant is a 31-year-old environmental safety and occupational health engineer, who has been employed by a defense contractor since May 2006 (Ex. 1, Tr. 100). Applicant seeks a secret-level security clearance for her duties, never having previously held a security clearance.

In the fall of 1995, Applicant began her undergraduate studies (Tr. 64-65). She financed her education through student loans totaling about $22,153 with one lender and $1,000 with another (Exs. 4, 5), work-study at the college during her sophomore year, and employment as a writing consultant at a learning center from September 1997 to February 2000 (Ex. 1). In February 1998, Applicant took out an $8,083 automobile loan on which she made regular payments (Ex. 5). Applicant was awarded her B.A. degree in biology and environmental studies in February 2000 (Ex. 1, Tr. 65). That September, she began pursuing graduate studies in neuropsychology part-time while working in a low-paying student co-op position, initially as a wildlife biologist for the U.S. government from March 2000 to August 2001, and then at the same duty location as a surveyor under the employ of a university (Ex. 1, Tr. 65-66).

Applicant was unemployed from October 2001 to August 2002, when she returned to her previous part-time position as a surveyor. In November 2002, she left that position for a graduate research position at the university where she was pursuing her studies. After the spring semester of 2003, she discontinued her academic studies so that she could focus on her employment search (Tr. 73). She realized that her finances were getting out of control and she needed more income (Tr. 84). She kept her research assistant position until November 2004 (Ex. 1), but had to rely heavily on credit cards to pay her expenses (Tr. 73). Several of her financial obligations became seriously delinquent during the 2002 to 2004 time frame. Also, the university sought $1,134 in unpaid class fees (SOR ¶ 1.l) for a course that she never took (Exs. 3, 4, 5, Tr. 80-83). Applicant worked full-time as a project biologist for a commercial company starting in December 2004 at an annual salary of $32,000 (Tr. 85). Her financial situation improved in that she did not continue to take on new debt until October 24, 2005, when she suffered a substantial loss of personal property in Hurricane Wilma. She lacked rental insurance and incurred an estimated $15,000 in out-of-pocket costs to replace her clothing, home furnishings (dishes, furniture, etc.), and computer (Tr. 54- 57). About $2,000 was spent to repair and clean her water-damaged automobile (Tr. 57). Applicant borrowed about $10,000 from family members that she repaid by late 2007 at priority over her delinquent consumer credit accounts (Tr. 57-58).

In January 2006, she was laid off by her employer (Ex. 1, Tr. 57). She incurred a couple of medical debts at that time (SOR ¶¶ 1.b, 1.c) that she thought were covered by insurance (Tr. 66-67). In March 2006, she started working as an environmental scientist for another company, but she left that job for her current employment in May 2006 (Ex. 1) at a salary of $55,000 annually (Tr. 101). On June 28, 2006, Applicant completed an e-QIP for a secret-level security clearance. In response to questions 28.a (any debts over 180 days delinquent in the last seven years) and 28.b (any debts currently delinquent over 90 days), Applicant listed eight debts (SOR ¶¶ 1.a, 1.d, 1.f, 1.h, 1.i, 1.j, 1.q, and 1.m) totaling $30,611. She indicated payment status was to be determined with respect to each of the debts (Ex. 1).

A check of Applicant’s credit on July 11, 2006, revealed she had repaid the $1,000 student loan satisfactorily. Her other student loan account was in good standing with a $22,030 balance, but several of her delinquent consumer credit accounts had been placed for collection, as set forth in the following table (Ex. 5).

Debt as alleged in SOR Delinquency history Payment status as of Jan

¶ 1.a. $11,663 credit card Credit card last activity Contacted creditor after debt in collection Nov 03, $8,130 balance Aug 1, 08 (Ex. 2, Tr. 61- for collection Jul 05 (Ex. 62), inquired about settling 1), $8,431 balance as of for lesser amount, creditor Oct 05 (Exs. 3, 4, 5), unwilling to waive interest $11,663 balance as of Oct (Tr. 62). No payments as 07 (Ex. 4), $12,938 of Jan 09 (Tr. 64). balance in collection as of Jul 08 (Ex. 3). ¶ 1.b. $500 medical debt in Incurred in Jan 06, sent for Researched debt after Aug collection collection Jul 06 (Exs. 3, 1, 08, insurance claim that 4), balance $595 as of Dec had not been paid (Ex. 2, 08 (Ex. 3). Tr. 66, 68), plans to contest debt (Tr. 69). ¶1.c. $35 medical debt in Incurred Jan 06, for Researched debt with collection collection Jul 06, balance hospital after Aug 1, 08, $35 as of Jul 06 (Exs. 3, but has not contacted 4). assignee. She made several co-pays and creditor missed one (Tr. 70). ¶ 1.d. $713 apartment Incurred Apr 04, for Disputes on basis paid rental debt in collection collection Sep 04, $713 rent in full and premises balance as of Jan 05 (Exs. leveled after she vacated 1, 3, 4, 5). (Ex. 2, Tr. 70-71). ¶ 1.e. $220 medical debt in Debt from May 02, for Not contacted creditor by collection collection Oct 03, unpaid Jan 09, no payments (Ex. as of Jun. 04 (Exs. 3, 4, 5). 2, Tr. 72-73). ¶ 1.f. $8,295 credit card Account opened Aug 00, Contacted creditor after debt charged off last activity Nov 02, $7,427 Aug 1, 08 (Ex. 2, Tr. 73), past due, balance $8,295 inquired about settling for as of Jun. 06, still owed as a lesser amount, creditor of Nov 08 (Exs. 1, 3, 4, 5). unwilling to waive interest. No payments as of Jan 09 (Tr. 73-74). ¶ 1.g. $486 credit card Opened Jun. 02 for Disputed amount with debt in collection purchases on e-Bay, $486 creditor in past as balance high credit for collection spiked after she missed May 03 after she missed one payment, no recent one payment (Ex. 5, Tr. contact (Ex. 2, Tr. 75); 75), unpaid as of Dec 08 does not deny an unpaid (Ex. 3). balance. ¶ 1.h. $1,402 retail charge Opened Nov 00, $762 past Contacted creditor as of card debt in collection due balance for collection Aug 08 to discuss May 03 (Ex. 5), $979 repayment of $1,449.20 balance as of May 04 (Ex. balance (Ex. 2). Debt paid 1), $1,402 balance as of in full Nov. 24, 08 (Ex. E, Apr 08 (Ex. 4). Tr. 75-76). ¶ 1.i. $3,107 credit card $1,800 debt from Jun. 03 Creditor pursued debt in collection for collection Sep 04 (Ex. garnishment, payments of 1), balance $2,100 as of $200 twice monthly since Jul 06 (Ex. 5), $3,121 Oct. 10, 08 to collect balance as of Aug 08 (Ex. $3,312.27 balance (Ex. G, 2). Tr. 76-78, 109-10, 112). ¶ 1.j. $9,449 retail charge $7,432 debt as of Nov 02, Not contacted creditor by card debt in collection for collection Jul 03, Aug 08 (Ex. 2). Hoping to $8,844 balance as of Jun. reduce sizeable interest 05 (Ex. 1), $8,913 balance through help of legal as of Jun. 06 (Ex. 5), services retained through balance $9,794 as of Dec employee benefit plan (Tr. 08 (Ex. 3). 78-79). ¶ 1.k. $149 collection debt $101 telephone debt from Contacted creditor by Jun. 02 for collection, $149 telephone and requested balance as of Apr 08 (Ex. proof of $151.04 debt 4). balance as of Aug 08 (Ex. 2, Tr. 79-80). No response from the creditor as of Jan 09 (Tr. 80). ¶ 1.l. $1,134 debt to Incurred Jan 03, $1,134 Disputed with creditor university past due balance Jun. 06 (Ex. 5) several times (Ex. 2, Tr. and Apr 08 (Ex. 4). 80), fee for class she did not take nor register for (Tr. 81). ¶ 1.m. $8,701 automobile Opened Jul 02, fell behind Undisputed, had not loan debt in collection a couple of payments, contacted creditor by Aug voluntary repossession 08 (Ex. 2). (Tr. 84), $8,701 balance charged off Sep 03 (Exs. 1, 4, 5). ¶ 1.n. $175 collection debt $175 debt from Jul 02 for Not contacted creditor (Tr. collection Jan 03, $175 90). balance as of Apr 03 (Ex. 5). ¶ 1.o. $87 collection debt $87 debt balance on an Intended to research debt installment loan from Apr as of Aug 08 (Ex. 2). Had 03 (Ex. 5). not done so as of Jan 09 (Tr. 90), does not appear on May 08 or Jan 09 credit reports (Exs. 3, 4). ¶ 1.p. $8,777 credit card Revolving charge opened Contacted creditor as of debt in collection Aug 01, $8,777 balance Aug 08 to discuss charged off Sep 02 (Ex. 5). repayment, disputes Balance $18,214.43 as of $18,214.43 balance as too Jan 09 due to interest (Ex. high (Ex. 2), no payments 2). as of Jan 09 (Tr. 91). ¶ 1.q. $979 retail charge Opened May 00, $979 for Not contacted creditor by debt in collection collection Jul 03, account Aug 08 (Ex. 2). No closed Jan 04 (Exs. 1, 5). payments (Tr. 92).

In about February 2007, Applicant received an 8 percent increase in pay when she went from her job in the quality department to her present position of environmental safety and occupational health engineer (Tr. 100-01). In August 2007, she was interviewed by a government investigator about her delinquent debt. She expressed a willingness to resolve the debt. In response to DOHA interrogatories, Applicant indicated on August 1, 2008, that she had contacted those creditors in SOR ¶¶ 1.h, 1.i, and 1.pto discuss repayment terms. She requested proof of the telephone debt in SOR ¶ 1.k, and disputed those debts in SOR ¶¶ 1.dand 1.l. Applicant denied knowledge of the medical debts in SOR ¶¶ 1.band 1.c, but indicated she would find out how to resolve them. At DOHA’s request, she completed a personal financial statement in which she estimated a net monthly remainder of $39 after paying $100 each month on her student loan principal balance of $21,617.13 (Ex. 3, Ex. D). Applicant added that she had paid off her private debt to family and friends, was not accruing new debt, and had only one active credit card account on which she was paying more than the monthly minimum. She expressed an intent to make payments on her debts when she was financially able to do so (Ex. 2).

In February 2008, Applicant attended a presentation at her local library about debt management (Tr. 97). She also telephoned at least one consumer credit counseling service, apparently sometime in 2008 (Tr. 97). In about July 2008, Applicant attended a seminar at work concerning employee benefits, including a program providing legal coverage in debt collection actions (Ex. F, Tr. 43, 96). In October 2008, during the enrollment period, she signed up for the coverage at a cost to her of $10 per month, with her eligibility to run for one year starting January 2009 (Tr. 44, 98). Applicant intends to have an attorney within the plan negotiate with her creditors to get the interest charges waived on her debts and to arrange for settlements on her behalf (Tr. 44, 95).

Despite an annual salary of $60,000 for her work with the defense contractor (Tr. 86), Applicant’s budget is “usually pretty tight.” (Tr. 89). Applicant’s rent is now $900 a month. It had been $1,200 until November 2008 when she moved to be closer to work and to reduce costs (Tr. 90, 99). Her utility costs are about $230 plus a disposal fee. Cable television, Internet, and telephone (home and cell) total about $250 per month (Tr. 87). She paid off her car a couple of years ago, so she does not have a car payment, although she pays about $130 every three months in car insurance (Tr. 89). She needs to budget for a car payment as her automobile “is on its way out.” (Tr. 88). Applicant pays $100 per month on her student loan, which had a principal balance of $21,774.04 as of December 12, 2008, and it was in good standing (Ex. D). She spends about $150 per month on medications (Tr. 89).

As of December 2008, Applicant was reported by Equifax Information Services to owe a balance of $1,259 on her active credit card account which had a limit of $1,200 (Ex. 3). Applicant made payments within the last two months to bring her balance to about $800 (Tr. 93). Applicant admits that she exceeded her credit limit because of recent travel and holiday gifts (Tr. 93).

A high-ranking employee for the defense contractor testified on Applicant’s behalf at her hearing. An old family friend, he provided her some assistance in the application process but did not participate in the decision to hire her. They have worked on a couple of projects together, including some company sensitive internal efforts to remove hazardous chemicals from the production process. Applicant has given him no reason to doubt her personal integrity, judgment, or reliability (Tr. 116-23). He understood that Applicant had some financial problems after the hurricane, but he remains unaware of the extent (Tr. 124).

Applicant’s direct supervisor since January 2007 has had the opportunity to closely observe Applicant’s work performance and handling of company sensitive information. He considers her to be a valuable member of their section. In the past year, she was responsible for coordinating and arranging several program events using company funding and she executed her duties “flawlessly.” (Ex. A).

A professional colleague, who has spent time in Applicant’s apartment, attests that Applicant appears to be living within her means. In their work interactions, Applicant has exhibited willingness to abide by rules and regulations required by the government, their employer, and subcontractors (Ex. B). The company’s security manager is also aware of no reason to question Applicant’s integrity or her ability to safeguard classified information (Ex. C).

POLICIES

When evaluating an applicant’s suitability for a security clearance, the administrative judge must consider the revised adjudicative guidelines (AG). In addition to brief introductory explanations for each guideline, the adjudicative guidelines list potentially disqualifying conditions and mitigating conditions, which are useful in evaluating an applicant’s eligibility for access to classified information. These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, these guidelines are applied in conjunction with the factors listed in the adjudicative process. The administrative judge’s overarching adjudicative goal is a fair, impartial and common sense decision. According to AG ¶ 2(c), 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 access to classified information will be resolved in favor of national security.” In reaching this decision, I have drawn only those conclusions that are reasonable, logical and based on the evidence contained in the record. Likewise, I have avoided drawing inferences grounded on mere speculation or conjecture. 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 applicant or proven by Department Counsel. . . .” The Applicant has the ultimate burden of persuasion as to obtaining 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 that 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 potential, rather than actual, risk of compromise of classified information. Section 7 of Executive Order 10865 provides that 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 EO 12968, Section 3.1(b) (listing multiple prerequisites for access to classified or sensitive information).

ANALYSIS

Guideline F, Financial Considerations

The security concern about finances 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.

Applicant disputes the validity of the debts in SOR ¶¶ 1.b, 1.c, 1.d, 1.k, 1.l, and 1.o. All of these debts appear on one or more of her credit reports. At the same time, Applicant can successfully rebut the credit listing by credible evidence that she has “a reasonable basis to dispute the legitimacy of the past-due debt that 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” (see AG ¶ 20(e)). Applicant relies solely on her testimony, which is accepted given her overall candor about her debts. Applicant asserted that the $595 medical debt (SOR ¶ 1.b) should have been paid by a former insurer (Tr. 68). The medical debt was incurred in January 2006, and she was laid off that same month. Her explanation of insurance error is plausible. She credibly explained that she had made several co-pay payments of $35 (SOR ¶ 1.c) and one was simply not credited to her account. Concerning the $713 debt claimed by a previous landlord (SOR ¶ 1.d), Applicant surmises the debt is likely from charges after she vacated but the apartments have since been leveled (“The reason why I had to move out is because they were demolishing the house, so I don’t know what charges they could have charged on a house that they demolished and then built stuff on.” Tr. 71). The legitimacy of the debt does not turn on whether she can successfully contact her former landlord or the collection agency, but it is unclear what the debt was for or whether the creditor would pursue the debt. There has been no effort by the creditor to report a past due balance to Equifax since January 2005 (see Exs. 3, 4). The $149 debt (SOR ¶ 1.k) owed for telephone charges from June 2002 is still listed as an open collection debt. However, Applicant has requested proof of the debt, which she has consistently denied. As for the $1,134 debt balance (SOR ¶ 1.l) from March 2003, Applicant testified that the university assumed incorrectly from a $100 credit on her account that she had registered for a class that she had not taken; that the university understood the error and it would not bar her from obtaining her transcript. Applicant does not recognize the $87 debt (SOR ¶ 1.o) and it does not appear on her recent credit reports.

Applicant does not dispute that she incurred delinquent balances on several credit card accounts (SOR ¶¶ 1.a, 1.f, 1.g, 1.h, 1.i, 1.j, 1.m, 1.p, and 1.q), a $220 medical debt in 2003, or a deficiency balance on an automobile loan for a vehicle that was repossessed when she could no longer afford to make the payments. Although unaware of the nature of the $175 debt in SOR ¶ 1.n, she does not dispute its validity. She has satisfied the debt in SOR ¶ 1.h, and paid about $1,200 through wage attachment toward the debt in SOR ¶ 1.i. Yet, even after these payments, her total undisputed delinquent debt balance exceeds $50,000. If the creditor of the debt in SOR ¶ 1.pdemands the full $18,214, her outstanding delinquent debt totals more than $60,000. Significant security concerns are raised by “inability or unwillingness to satisfy debts” (AG ¶ 19(a)) and by “a history of not meeting financial obligations” (AG ¶ 19(c)). To the extent that over extension on consumer credit cards reflects spending beyond her means, AG ¶ 19(e), “consistent spending beyond one’s means, which may be indicated by excessive indebtedness, significant negative cash flow, high debt-to- income ratio, and/or other financial analysis”), this behavior was confined to when she was in college and graduate school and lacking full-time, well-paying employment.

Concerning potential mitigation of the undisputed delinquent debt, most of the accounts became delinquent in 2002 and 2003, when she was in graduate school and held part-time employment. Yet, 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,” cannot be fully applied in mitigation. She remains under a significant debt burden that she has only recently begun to resolve.

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, or a death, divorce or separation), and the individual acted responsibly under the circumstances,” is implicated. She ran up about $35,793 on eight credit card accounts before they were charged off and/or referred for collection (SOR ¶¶ 1.a, 1.f, 1.g, 1.h, 1.i, 1.j, 1.p, and 1.q). Without income or expense information available for 2002/03, it is unclear to what extent Applicant relied on consumer credit for schooling versus living or discretionary expenditures while she was in graduate school. However, lack of income was a factor in incurring the debt. Furthermore, personal property losses incurred during the October 2005 hurricane forced her to borrow about $10,000 that was repaid at priority over her old debts. Yet, the financial setback caused by the hurricane cannot reasonably be relied on to explain the delay in addressing her delinquent indebtedness over the latter half of 2007 into 2008. She began working for her current employer in May 2006 at an annual salary of $55,000. In February 2007, her income increased to $60,000. She satisfied her personal loans to family members by late 2007, but had made no payments on any of her undisputed delinquencies as of her response to DOHA interrogatories in August 2008.

It is only within the past year that she has taken meaningful steps to resolve her debts. In about February 2008, Applicant attended a presentation at her local library on debt management. In July 2008, she learned of a potential employment benefit in that she could retain an attorney to negotiate on her behalf with her creditors. During the open enrollment period in October 2008, she enrolled for this calendar year. Albeit in response to a garnishment action by the assignee, she began making payments of $200 per paycheck starting October 10, 2008, on the debt in SOR ¶ 1.i. In November 2008, she satisfied the debt in SOR ¶ 1.h. AG ¶ 20(d), “the individual initiated a good- faith effort to repay overdue creditors or otherwise resolve debts,” applies in part, but it would be premature to apply AG ¶ 20(c), “the person has received or is receiving counseling for the problem and/or there are clear indications that the problem is being resolved or is under control.”

With her student loan debt at about $21,774 and delinquent debt now amounting to as much as $61,729 (SOR ¶¶ 1.a, 1.e-1.j, 1.n, 1.p, and 1.q), Applicant is not likely to resolve her debts in the foreseeable future. As of her hearing, it was unclear whether any of her creditors would waive the interest charges on her past due debts. Even after moving closer to work in November 2008 to reduce her expenses, her budget was still “pretty tight.” Her credit report of January 2009 (Ex. 3) shows she was $59 over her credit limit of $1,200 on her only active credit card account as of December 2008, although Applicant testified that she made several payments in excess of the monthly minimum to where her account is now below its limit.

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 conduct and all the circumstances in light of the nine adjudicative process factors listed at AG ¶ 2(a):

(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.

The DOHA Appeal Board has addressed a key element in the whole person analysis in financial cases stating:

In evaluating Guideline F cases, the Board has previously noted that the concept of “‘meaningful track record’ necessarily includes evidence of actual debt reduction through payment of debts.” However, an applicant is not required, as a matter of law, to establish that he has paid off each and every debt listed in the SOR. All that is required is that an applicant demonstrate that he has ‘ . . . established a plan to resolve his financial problems and taken significant actions to implement that plan.’ The Judge can reasonably consider the entirety of an applicant’s financial situation and his actions in evaluating the extent to which that applicant’s plan for the reduction of his outstanding indebtedness is credible and realistic. See Directive ¶ E2.2(a) (‘Available, reliable information about the person, past and present, favorable and unfavorable, should be considered in reaching a determination.’) There is no requirement that a plan provide for payments on all outstanding debts simultaneously. Rather, a reasonable plan (and concomitant conduct) may provide for the payment of such debts one at a time. Likewise, there is no requirement that the first debts actually paid in furtherance of a reasonable debt plan be the ones listed in the SOR.

ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008) (internal citations omitted). Applicant has taken a credible first step toward resolving her debt by enrolling in a legal care benefit program at work. However, it remains to be seen whether she or her attorney will be able to negotiate debt repayment terms that she can reasonably afford. Payments made in fall 2008 to satisfy the debt in SOR ¶ 1.hare not enough to establish “a meaningful track record” in light of her serious delinquency on several accounts over the past five to six years. Applicant has proven that she can handle company sensitive information appropriately, but it does not completely dispel the judgment concerns raised by her irresponsibility in her personal financial affairs. Based on the record before me, I cannot conclude that it is clearly consistent with the national interest to grant Applicant a security clearance at this time.

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

Subparagraph 1.a: Against Applicant Subparagraph 1.b: For Applicant Subparagraph 1.c: For Applicant Subparagraph 1.d: For Applicant Subparagraph 1.e: Against Applicant Subparagraph 1.f: Against Applicant Subparagraph 1.g: Against Applicant Subparagraph 1.h: For Applicant Subparagraph 1.i: For Applicant Subparagraph 1.j: Against Applicant Subparagraph 1.k: For Applicant Subparagraph 1.l: For Applicant Subparagraph 1.m: Against Applicant Subparagraph 1.n: Against Applicant Subparagraph 1.o: For Applicant Subparagraph 1.p: Against Applicant Subparagraph 1.q: Against Applicant

CONCLUSION

In light of the record in this case, it is not clearly consistent with the national interest to grant Applicant eligibility for a security clearance. Eligibility for access to classified information is denied.

ELIZABETH M. MATCHINSKI Administrative Judge