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ISCR Case 08-08139.h1 — CASE

ISCR Case 08-08139.h1granted

Case Headnote

ISCR Case No. 08-08139.h1

grantedJun 1, 2009· Hon. Mark W. Harvey· hearing

Summary

A 41-year-old information technology specialist working for a defense contractor was granted a security clearance despite concerns under Guideline F (Financial Considerations). The Statement of Reasons (SOR) detailed nine specific financial allegations. These included a $10,044 credit card debt with a judgment filed in October 2007, a $1,693 credit card debt, and a $7,678 credit card debt currently in litigation. Other debts listed were an electrical account of $281, medical debts of $140 and $100, a store credit debt of $538, a credit union credit card debt of $13,505, and an energy debt of $88.

The applicant successfully addressed most of these issues. He paid the $281 electrical account on April 24, 2009, the $140 medical debt on May 12, 2009, the $100 medical debt on May 2, 2009, and the $88 energy debt on October 11, 2006. Additionally, the $538 store credit debt was settled for $250 and paid, and the $13,505 credit union credit card debt is currently on a payment plan.

The judge found that the applicant had paid six of the nine SOR debts and was actively managing another. His financial difficulties were primarily attributed to periods of unemployment and underemployment. The applicant demonstrated a meaningful track record of debt repayment and financial responsibility, leading to the decision to grant his security clearance.

Why the Applicant Prevailed

The applicant paid six of nine SOR debts and is on a payment plan for another.
He demonstrated a meaningful track record of debt repayment and financial responsibility.
His financial difficulties were largely due to unemployment and underemployment.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(b)appliedConditions That Resulted in the Financial Problem Were Largely Beyond the Person’s Control
AG ¶ 20(c)appliedThe Person Has Received or Is Receiving Counseling for the Problem
AG ¶ 20(d)appliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors

Key Rule Quoted

“Eligibility for a security clearance is predicated upon the Applicant meeting the criteria contained in the revised adjudicative guidelines (AG).”

Procedural Posture

SOR issuedFeb 11, 2009
Answer filedFeb 28, 2009
Hearing heldMay 20, 2009
Decision dateJun 1, 2009

Cite For

Mitigation of Financial Considerations Under Guideline F
Good Faith Efforts in Debt Repayment
Impact of Unemployment on Financial Security Concerns

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: granted

The judge found that the applicant mitigated financial concerns by demonstrating a meaningful track record of debt repayment, having paid six of nine debts listed in the Statement of Reasons (SOR). The applicant's financial issues were primarily due to unemployment and underemployment, and he is now in a better financial position, leading to the granting of his security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Credit card debt of $10,044 resulted in a judgment filed in October 2007 $10,044	For Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (c) received/receiving counseling; problem being resolved (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.b	Electrical account of $281 was paid on April 24, 2009 $281	For Applicant	Utility or Phone Debt	Admitted	—	—	—
1.c	Medical debt of $140 was paid on May 12, 2009 $140	For Applicant	Medical Debt	Admitted	—	—	—
1.d	Credit card debt of $1,693 $1,693	For Applicant	Credit Card Debt	Admitted	—	—	—
1.e	Credit card debt of $7,678 is in litigation $7,678	For Applicant	Credit Card Debt	Unknown	—	—	—
1.f	Store credit debt of $538 was settled for $250 and paid $538	For Applicant	Unspecified Financial	Admitted	—	—	—
1.g	Credit union credit card debt of $13,505 is in a current payment plan $13,505	For Applicant	Credit Card Debt	Unknown	—	—	—
1.h	Medical debt of $100 was paid on May 2, 2009 $100	For Applicant	Medical Debt	Admitted	—	—	—
1.i	Energy debt of $88 was paid on October 11, 2006 $88	For Applicant	Utility or Phone Debt	Admitted	—	—	—

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. 08-08139 SSN: ----------- ) ) Applicant for Security Clearance )

For Government: Alison O’Connell, Esquire, Department Counsel For Applicant: Pro Se

June 10, 2009 __________

STATEMENT OF CASE

__________

HARVEY, Mark W., Administrative Judge:

Applicant mitigated the financial considerations security concerns. He has demonstrated a meaningful track record of debt repayment. He paid six of nine statement of reason (SOR) debts. One SOR debt is in a current payment plan. One debt is in litigation, and one debt has not yet been adequately addressed. Other debts were paid or are in current payment plans. He credibly promised to pay his debts. Access to classified information is granted.

Statement of the Case

On April 29, 2008, Applicant submitted an Electronic Questionnaires for Investigations Processing (e-QIP) (SF 86) (Government Exhibit (GE) 1). On February 11, 2009, the Defense Office of Hearings and Appeals (DOHA) issued an SOR detailing the basis for its preliminary decision to deny Applicant eligibility for access to classified information, citing security concerns under Guideline F (Financial Considerations). The action was taken under Executive Order 10865, Safeguarding Classified Information within Industry (February 20, 1990), 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 for SORs issued after September 1, 2006. The SOR detailed reasons why DOHA could not make the preliminary affirmative finding under the Directive that it is clearly consistent with the national interest to grant or continue his security clearance, and recommended referral to an administrative judge to determine whether his clearance should be granted, continued, denied, or revoked.

On February 28, 2009, Applicant responded to the SOR and requested a hearing before an administrative judge. Department Counsel was prepared to proceed on April 14, 2009. The case was assigned to me on April 16, 2009. On April 17, 2009, DOHA issued a hearing notice. The hearing was held on May 20, 2009. At the hearing, Department Counsel offered four exhibits (GE 1-4) (Transcript (Tr.) 16), and Applicant offered 12 exhibits (AE A-L) (Tr. 18-21). There were no objections, and I admitted GEs 1-4 (Tr. 17), and AE A-L (Tr. 21). Additionally, I admitted the SOR, response to the SOR and the hearing notice (GEs 5-7). On May 26, 2009, Applicant provided 12 additional exhibits (AE M-X). Department counsel did not object to my consideration of AE M-X and I admitted these exhibits. I received the transcript on May 28, 2009. I closed the record on June 1, 2009 (Tr. 86).

Findings of Fact1

In his SOR response, Applicant admitted responsibility for the SOR debts in ¶¶ 1.a, 1.d, and 1.g (GE 7). He essentially denied responsibility for the other debts with explanations (GE 7).

Applicant is a 41-year-old employee of a defense contractor (Tr. 6-7). He is a specialist in information technology and is employed as a senior systems administrator (Tr. 7, 24). He has been employed by his current employer since October 2007, and moved from a temporary employee to a permanent employee in April 2008 (Tr. 24). He graduated from high school in 1986, and subsequently attended about a year of college in the 1990s (Tr. 7, 22). He served in the Air Force from 1988 to 1996 (Tr. 23). He was married from 1987 to 2002, and remarried in December 2002 (Tr. 23). He has five children (three are stepchildren) ages 20, 13, 12, 6 and 6 (Tr. 23). He does not pay any child support.

Financial Considerations

Applicant began working at a large communications corporation in 1997 (Tr. 45). By 2004, Applicant was receiving over $100,000 per year from this employer (Tr. 25). He was laid off in March 2005 (Tr. 25, 45). He received several months of severance pay and thereafter he received unemployment pay of $1,552 per month until his unemployment benefits expired (Tr. 46, 48). Prior to being laid off, he had excellent credit and was able to buy a house without providing a down payment (Tr. 26). During his unemployment, he used his 401K and savings to pay living expenses (Tr. 25). Using savings and gifts from his parents, he was able to make payments on many of his debts for 18 months (Tr. 40, 53). He tried to sell real estate and over a six or seven month period earned about $6,000 (Tr. 47). He had a part-time job from January 2006 to July 2007, which paid about $1,700 per month (Tr. 48). He was unemployed again from August to October 2007 (Tr. 51). When he started with his current employer, he was making $24 an hour, and he is now making $31 per hour (Tr. 51). The reason his debts became delinquent was because of unemployment and underemployment (Tr. 52, 68, 71).

Applicant’s SOR listed nine debts. He paid the debts in SOR ¶¶ 1.b, 1.c, 1.d, 1.f, 1.hand 1.i. The debt in SOR ¶ 1.gis in a current payment plan. The debt in SOR ¶ 1.e is in litigation, and the debt in SOR ¶ 1.a has not yet been adequately addressed. The source, status, and amount of his individual SOR debts are more specifically described as follows (paragraph letters correspond with the SOR subparagraphs):

(a) Credit card debt of $10,044 resulted in a judgment filed in October 2007 (SOR ¶ 1.a; Tr. 25-27). After the judgment, he made six payments for $25 a month, and then the creditor changed their name to a new name (Tr. 26-29). On June 11, 2008, he owed $10,363 (AE P). He declined to make payments to the new collection company because he was seeking verification that the new collection company owned the debt (Tr. 26-28). On September 21, 2008, he wrote the creditor seeking verification; however, the only response was a demand for payments (Tr. 27-28). His letter included some valid questions, such as asking for proof of the amount of the debt (including charges and previous payments); however, it also included some terms that a responsible creditor should not have to provide as a prerequisite to receiving payment, such as demanding proof that the statute of limitations had not expired (AE N);

(b) Electrical account of $281 was paid on April 24, 2009 (SOR ¶ 1.b; Tr. 29-30; AE F). He believed it was previously paid, but could not locate a receipt (Tr. 30);

(c) Medical debt of $140 was paid on May 12, 2009 (SOR ¶ 1.c; Tr. 30-32; AE Q at 3). The debt was generated in 2006, and was not paid sooner because it was billed to his stepson’s father (Tr. 30-31). He was unaware of the debt until he received the credit report in connection with processing his security clearance (Tr. 31);

(d) Credit card debt of $1,693 (SOR ¶ 1.d; Tr. 33). He stopped making payments on this account in mid-2006 (Tr. 34). He made two, $40 payments in January and February 2009, in an attempt to get a payment plan started (Tr. 35-36). On March 14, 2009, the balance was $1,735 (AE J). On April 24, 2009, he paid $750, and on May 1, 2009, the balance was $1,018 (AE I, L). On May 15, 2009, Applicant paid $397 towards this debt (AE K). On May 22, 2009, the creditor indicated the debt was paid (AE U).

(e) Credit card debt of $7,678 (SOR ¶ 1.e; Tr. 36-38). This debt is in litigation because creditor added excessive charges to the bill and allegedly engaged in abusive collection practices (Tr. 36; AE V). The lawsuit was filed on April 20, 2009 (AE V). Applicant admitted he owed a debt to the creditor and believed the debt should be for about $3,000 (Tr. 38).

(f) Store credit debt of $538 (SOR ¶ 1.f; Tr. 38-39). He said he paid this debt previously, and decided to pay it again to get if off of his credit report (Tr. 39). On May 13, 2009, this debt was settled for $250 and paid (AE C; Tr. 39).

(g) Credit union credit card debt of $13,505 (SOR ¶ 1.g). Applicant said he paid $500 initially, and was supposed to pay $234 monthly on the 15th of the month (Tr. 41). On May 6, 2009, this debt was “paid” using a re-write of the account (Tr. 42; AE G, Q at 2). This procedure eliminated the old delinquent debt; however, a new debt was generated (Tr. 42);

(h) Medical debt of $100 (SOR ¶ 1.h; Tr. 32-33, 42-43). On May 2, 2009, this debt was paid (amount shown is $106.95) (AE Q at 2; Tr. 43).

(i) Energy debt of $88 (SOR ¶ 1.i; Tr. 44). On October 11, 2006, this debt was paid (Tr. 44). See letter from creditor, dated May 6, 2009 (AE H).

On March 10, 2009, a non-SOR creditor offered to settle a debt for $1,009 for a 30% discount (AE D). The payment schedule for resolution was three payments of $235.54 (AE D). Applicant made the first two payments (AE D; AE Q at 4).

Applicant provided a bill from a credit union, dated April 24, 2009, indicating he owed $211 (AE E) on a non-SOR debt of $11,251 (Tr. 64-65; AE O). Applicant wanted to make monthly payments for about $60 to keep the account current; however, the creditor wanted more money (Tr. 64-65). Applicant signed a settlement agreement and promised to pay $155 monthly until the debt was paid (AE S). His first payment is due June 20, 2009 (AE V).

Applicant paid several non-SOR debts (Tr. 60-63; GE 2; AE A, X). Applicant purchased a model-2008 car in April 2008, and financed $14,454 with monthly payments of $240 (Tr. 63; GE 3 at 3). His car payment is current (GE 3 at 3).

Applicant and his spouse’s current monthly net pay is about $6,000 (Tr. 54, 69). In December 2008, his wife obtained employment (earning about $2,000 per month), as an asset recovery specialist at a bank (collects on car loans) (Tr. 69). Prior to obtaining this employment she was essentially unemployed (Tr. 70).

Applicant and his spouse purchased their home in 2004 and their mortgage is $136,000 and their monthly mortgage payment is $1,460 (Tr. 55; GE 3 at 3). Other monthly expenses are: clothing-$100; food-$650; phone, cable and internet-$175; utilities-$185; vehicle fuel and insurance-$335; medical-$120; entertainment-$100 (Tr. 56-59). In June 2008, they recently purchased a central air conditioning and heating system for their residence, which cost $22,800 and has a monthly payment of $225 (Tr. 58, 61-62). Applicant estimated they have about $1,000 monthly left after paying their expenses (Tr. 59).

Applicant debt repayment plan is based on Dave Ramsey’s advice. Essentially, his plan is to pay off one debt at a time, and then to use the extra funds saved from making payments to pay off the next debt. This plan is known as the Dave Ramsey debt-snowball plan (Tr. 60).

Three character witnesses described Applicant as courageous, honest, loyal, prudent, frugal, hard working, capable and/or responsible (Tr. 71, 73-75, 78-81). Applicant loves his country, and his family and is loyal to them (Tr. 73-75). Applicant aggressively sought additional income through part-time employment and applying for employment in the years 2005 to 2007 (Tr. 78-81).

POLICIES

The U.S. Supreme Court has recognized the substantial discretion of the Executive Branch in regulating access to information pertaining to national security emphasizing, “no 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 and modified.

Eligibility for a security clearance is predicated upon the Applicant meeting the criteria contained in the revised adjudicative guidelines (AG). These guidelines are not inflexible rules of law. Instead, recognizing the complexities of human behavior, these guidelines are applied in conjunction with an evaluation of the whole person. An administrative judge’s over-arching adjudicative goal is a fair, impartial and common sense decision. An administrative judge must consider all available, 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 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. Clearance decisions must be “in terms of the national interest and shall in no sense be a determination as to the loyalty of the [A]pplicant concerned.” See Exec. Or. 10865 § 7. See also Executive Order 12968 (Aug. 2, 1995), Section 3. Thus, nothing in this decision should be construed to suggest that I have based this decision, in whole or in part, on any express or implied determination as to Applicant’s allegiance, loyalty, or patriotism. It 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. 95-0611 at 2 (App. Bd. May 2, 1996).

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 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). The burden of disproving a mitigating condition never shifts to the government. See ISCR Case No. 02-31154 at 5 (App. Bd. Sep. 22, 2005). “[S]ecurity clearance determinations should err, if they must, on the side of denials.” Egan, 484 U.S. at 531; see AG ¶ 2(b).

ANALYSIS

Upon consideration of all the facts in evidence, and after application of all appropriate legal precepts, factors, and conditions, I conclude the relevant security concern is under Guideline F (Financial Considerations). AG ¶ 18 articulates the security concern relating to financial problems:

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.

AG ¶ 19 provides two Financial Considerations Disqualifying Conditions that could raise a security concern and may be disqualifying in this case, “(a) inability or unwillingness to satisfy debts,” and, “(c) a history of not meeting financial obligations.” ISCR Case No. 03-20327 at 3 (App. Bd. Oct. 26, 2006) provides, “Applicant’s credit report was sufficient to establish the Government’s prima facie case that Applicant had [ ] delinquent [SOR] debts that are of security concern.” Applicant’s history of delinquent debt is documented in his SF 86, his responses to DOHA interrogatories, his SOR response and at his hearing. He failed to ensure his creditors were paid as agreed. The government established the disqualifying conditions in AG ¶¶ 19(a) and 19(c). Further inquiry about the applicability of mitigating conditions is required.

Five Financial Considerations Mitigating Conditions under AG ¶¶ 20(a)-(e) 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, or a death, divorce or separation), and the individual acted responsibly under the circumstances;

(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;

(d) the individual initiated 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.

Applicant’s conduct does not warrant full application of AG ¶¶ 20(a) or 20(e) because he did not act more aggressively and responsibly to resolve his delinquent debts. His delinquent debts are “a continuing course of conduct” under the Appeal Board’s jurisprudence. See ISCR Case No. 07-11814 at 3 (App. Bd. Aug. 29, 2008) (citing ISCR Case No. 01-03695 (App. Bd. Oct. 16, 2002)).

Applicant receives full credit under AG ¶ 20(b) because his financial problems initially resulted because of unemployment and underemployment. He receives substantial mitigating credit because his delinquent debt “occurred under such circumstances that it is unlikely to recur and does not cast doubt on [his] current reliability, trustworthiness, or good judgment.” He established that he paid six SOR debts and several non-SOR debts. He is making payments under a payment plan for one debt, one debt is in litigation, and one debt needs further resolution. He has a plan to keep his debts current, including several substantial non-SOR debts. He has ample income to pay his debts.

AG ¶ 20(c) applies. Applicant received some financial counseling via the Dave Ramsey plan, and there are “clear indications that the problem is being resolved or is under control” for the reasons stated in the preceding paragraph. He understands the security implications of delinquent debt and will scrupulously avoid future delinquent debt. He has also established some, but not full mitigation under AG ¶ 20(d) because he showed substantial good faith2 in the resolution of his SOR debts.

Applicant contests the validity of the amount of the debt in SOR ¶ 1.e and wants better documentation of the amount of the debt in SOR ¶ 1.a before he starts making payments. He provided his court filing contesting the amount owed on the debt in SOR ¶ 1.e, and the letter seeking more information about the debt in SOR ¶ 1.a. He credibly promised to pay these two debts once he establishes their validity.3 His conduct shows he acted responsibly under the circumstances.4 AG ¶ 20(e) does not fully apply because he did not provide sufficient corroborating documentation about his efforts to establish his responsibility for the debt in SOR ¶ 1.a.

In sum, Applicant should have been more diligent and made greater efforts sooner to resolve his delinquent debts. Nevertheless, he established the full applicability of AG ¶¶ 20(b) and 20(c). Moreover, security concerns are fully mitigated under the “Whole Person Concept,” infra at pages 8-10.

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 the circumstances. The administrative judge should consider 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.

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. AG ¶ 2(c). I have incorporated my comments under Guideline F in my whole person analysis. Some of the factors in AG ¶ 2(a) were addressed under that guideline, but some warrant additional comment.

There is evidence against mitigating Applicant’s financial conduct. Several of Applicant’s debts became delinquent in 2004-2006. In October 2007, he began his present employment. In December 2008, his wife began her current employment. However, he should have made greater progress on his debts beginning in December 2008. He received the SOR in February 2009, and he should have aggressively sought debt resolution of his SOR debts, including utilization of debt repayment, and payment plans. He should have ensured better documentation of his remedial efforts. These factors show some financial irresponsibility and lack of judgment. His history of delinquent debt raises sufficient security concerns to merit further inquiry.

The mitigating evidence under the whole person concept is more substantial. There is no evidence of any security violation. He is a law-abiding citizen. His current financial problems were caused by his unemployment, and underemployment. He paid six of nine SOR debts. He is making payments on one substantial SOR debt for about $10,000; and on an $11,000 non-SOR debt. A SOR debt for $3,000 to $7,000 is in litigation. He is investigating the debt in SOR ¶ 1.a for about $10,000. He is making his payments on his mortgage, his car, and on a central air conditioning and heating unit (owes about $22,000). He listed several non-SOR debts that he has recently paid (AE A). He and his spouse have had ample income to pay their debts since they both became employed in December 2008. The 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).

Although Applicant is only 41 years old, he has achieved some important educational and employment goals, demonstrating his self-discipline, responsibility and dedication. He served on active duty for eight years in the Air Force. He is an expert in networks and information technology. His financial problems were caused by his unemployment and underemployment from March 2005 to October 2007, rather than by his misconduct or irresponsible spending. Before his employment problems in March 2005, he did not have any delinquent debts. Applicant is clearly an intelligent person and he understands how to budget and what he needs to do to establish his financial responsibility. His wife works in a bank, and is involved in vehicle repossessions. He uses the Dave Ramsey plan, and pays off a debt, and then moves to the next debt. Clearly, he could have acted more aggressively to resolve his debts, after receiving employment with a government contractor. There is, however, simply no reason not to trust him. Moreover, he has established a “meaningful track record” of debt re-payment. He has promised to pay his valid debts. I found his statement to be candid, forthright and credible. Applicant has demonstrated his loyalty, patriotism and trustworthiness through his service to the Department of Defense as a contractor and to the U.S. Air Force. These factors, especially his past government service, show sufficient responsibility and rehabilitation to mitigate security concerns.

After weighing the disqualifying and mitigating conditions, and all the facts and circumstances, in the context of the whole person, I conclude he has mitigated the financial considerations security concerns.

I take this position based on the law, as set forth in Department of Navy v. Egan, 484 U.S. 518 (1988), my careful consideration of the whole person factors and supporting evidence, my application of the pertinent factors under the Adjudicative Process, and my interpretation of my responsibilities under the Guidelines. Applicant has mitigated or overcome the government’s case. For the reasons stated, I conclude he is eligible for access to classified information.

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

Subparagraphs 1.a to 1.i: For Applicant

CONCLUSION

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 eligibility for a security clearance. Eligibility for a security clearance is granted.

____________________________ Mark W. Harvey Administrative Judge

FOOTNOTES

1 Some details have not been included in order to protect Applicant’s right to privacy. Specific information is available in the cited exhibits. 2The Appeal Board has previously explained what constitutes a “good faith” effort to repay overdue creditors or otherwise resolve debts: In order to qualify for application of [the “good faith” mitigating condition], an applicant must present evidence showing either a good-faith effort to repay overdue creditors or some other good-faith action aimed at resolving the applicant’s debts. The Directive does not define the term ‘good-faith.’ However, the Board has indicated that the concept of good-faith ‘requires a showing that a person acts in a way that shows reasonableness, prudence, honesty, and adherence to duty or obligation.’ Accordingly, an applicant must do more than merely show that he or she relied on a legally available option (such as bankruptcy [or statute of limitations]) in order to claim the benefit of [the “good faith” mitigating condition]. (internal citation and footnote omitted) ISCR Case No. 02-30304 at 3 (App. Bd. Apr. 20, 2004) (quoting ISCR Case No. 99-9020 at 5-6 (App. Bd. June 4, 2001)). 3 Of course, the government can re-validate Applicant’s financial status at any time through credit reports, investigation and/or additional interrogatories. Approval of a clearance now does not bar the government from subsequently revoking it, if warranted. Violation of a promise made in a security context to pay legitimate debts also raises judgment concerns under Guideline E, and may support future revocation of a security clearance. This does not imply that this clearance is conditional.

4 “Even if Applicant’s financial difficulties initially arose, in whole or in part, due to circumstances outside his [or her] control, the Judge could still consider whether Applicant has since acted in a reasonable manner when dealing with those financial difficulties.” 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); ISCR Case No. 03-13096 at 4 (App. Bd. Nov. 29, 2005)). A component is whether the Applicant maintained contact with his or her creditors and attempted to negotiate partial payments to keep debts current.