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ISCR Case 14-00974.h1 — CASE

ISCR Case 14-00974.h1granted

Case Headnote

ISCR Case No. 14-00974.h1

grantedOct 17, 2014· Hon. LeRoy F. Foreman· hearing

Summary

A 44-year-old computer-based training instructor and former U.S. Marine was granted a security clearance despite concerns under Guideline F (Financial Considerations). The Statement of Reasons (SOR) detailed a history of financial difficulties, including a Chapter 13 bankruptcy filed in September 2006 and dismissed in August 2008.

Additional allegations included several collection accounts: $122 for unpaid utilities, $1,018 for an unpaid cell phone bill, $206 and $67 for medical bills, and $220 for an unpaid water bill. The applicant also had a mortgage loan with past due payments totaling $21,311, on a total balance of $96,097. These issues raised disqualifying conditions under Adjudicative Guidelines (AG) ¶ 19(a) and AG ¶ 19(c).

However, the judge applied mitigating conditions under AG ¶ 20(a) and AG ¶ 20(b). The clearance was granted because the applicant resolved several debts before the hearing, and his financial difficulties were largely attributed to circumstances beyond his control, such as job loss and economic downturns. The applicant also demonstrated responsible behavior in addressing his financial issues.

Why the Applicant Prevailed

The applicant resolved several debts alleged in the SOR before the hearing.
The financial difficulties were largely due to circumstances beyond the applicant's control, including job loss and economic downturns.
The applicant demonstrated responsible behavior in addressing his financial issues.

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(a)appliedBehavior Happened so Long Ago, Was Infrequent, or Occurred Under Circumstances Unlikely to Recur
AG ¶ 20(b)appliedConditions That Resulted in Financial Problems Were Largely Beyond the Person's Control

Key Rule Quoted

“Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the AG.”

Procedural Posture

SOR issuedApr 29, 2014
Answer filedUndated
Hearing heldSep 9, 2014
Decision dateOct 17, 2014

Cite For

Mitigating Conditions Under Guideline F Related to Financial Difficulties
Impact of External Circumstances on Financial Issues
Resolution of Debts as a Factor in Security Clearance Eligibility

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's financial issues, including a dismissed Chapter 13 bankruptcy and several delinquent debts, were mitigated by evidence of resolution of some debts and the applicant's current employment situation. Ultimately, the judge ruled in favor of the applicant, granting eligibility for access to classified information under Guideline F.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant filed a petition for Chapter 13 bankruptcy in September 2006, which was dismissed in August 2008.	For Applicant	Bankruptcy Filing	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly	—
1.b	collection account for unpaid utilities, $122. $122	For Applicant	Utility or Phone 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	Documented Debt Paid in Full
1.c	collection account for unpaid cell phone bill, $1,018. $1,018	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	collection account for unpaid medical bill, $206. $206	For Applicant	Medical 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	Documented Debt Paid in Full
1.e	mortgage loan payments past due for $21,311, with total balance on the loan of $96,097. $21,311	For Applicant	Mortgage or Home Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	collection account for medical bill, $67. $67	For Applicant	Medical 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	Documented Debt Paid in Full
1.g	collection account for unpaid water bill, $220. $220	For Applicant	Utility or Phone Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—

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: ) ) [Redacted] ) ISCR Case No. 14-00974 ) Applicant for Security Clearance )

For Government: Fahryn Hoffman, Esq., Department Counsel For Applicant: Pro se

10/17/2014 ______________

STATEMENT OF CASE

______________

FOREMAN, LeRoy F., Administrative Judge:

This case involves security concerns raised under Guideline F (Financial Considerations). Eligibility for access to classified information is granted.

Statement of the Case

Applicant submitted a security clearance application on November 22, 2013. On April 29, 2014, the Department of Defense (DOD) sent him a Statement of Reasons (SOR) alleging security concerns under Guideline F. The DOD acted under Executive Order 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 September 1, 2006.

Applicant received the SOR on May 7, 2014; answered it in an undated document; and requested a hearing before an administrative judge. On August 13, 2014, Department Counsel sent Applicant copies of the documents she intended to submit at the hearing. (Hearing Exhibit (HX) I). Department Counsel was ready to proceed on August 14, 2014, and the case was assigned to me on August 19, 2014. The Defense Office of Hearings and Appeals (DOHA) issued a notice of hearing on August 20, 2014, scheduling the hearing for September 9, 2014. I convened the hearing as scheduled. Government Exhibits (GX) 1, 2, and 4 were admitted in evidence without objection. GX 3 was not admitted, for the reasons set out below.

Applicant testified, presented the testimony of one witness, and submitted Applicant’s Exhibits (AX) A through F, which were admitted without objection. I kept the record open until September 26, 2014, to enable Applicant to submit additional documentary evidence. He timely submitted AX G through N, which were admitted without objection. Department Counsel’s comments regarding AX G through N are attached to the record as HX II. Applicant submitted AX O and P in rebuttal to Department Counsel’s comments in HX II. Department Counsel’s surrebuttal to AX O and P is attached to the record as HX III. DOHA received the transcript (Tr.) on September 25, 2014. The record closed on October 6, 2014.

Evidentiary Ruling

GX 3 is an unauthenticated summary of a personal subject interview included in the report of investigation prepared for DOD by the Office of Personnel Management. As such, it is subject to the authentication requirement in the Directive ¶ E3.1.20. Applicant declined to waive the authentication requirement. Department Counsel stated that she intended to question Applicant in order to authenticate GX 3. (Tr. 20-21.) Applicant reviewed the document and commented that it was inaccurate and omitted important details favorable to him. (Tr. 24, 26-27.)1 I ruled that GX 3 would not be admitted as substantive evidence, but that Department Counsel would be allowed to question Applicant about the document during cross-examination. (Tr. 25.)

An administrative judge is required by Directive ¶ E3.1.10 to “conduct all proceedings in a fair, timely, and orderly manner.” This duty is especially important when an applicant appears pro se and is unfamiliar with the rules of evidence and procedure applicable to administrative hearings.

Under Directive ¶ E3.1.14, Department Counsel is “responsible for presenting witnesses and other evidence” to establish controverted facts. This responsibility includes presenting evidence on foundational issues such as authentication.

There is no specific requirement in the Directive for advance notice of testimony from witnesses, and no prohibition against calling an applicant as an authenticating witness. However, it is fundamentally unfair to require an applicant to authenticate a summary of a personal subject interview against him or her without advance notice. Pro se applicants often do not understand the significance of statements attributed to them in the summary of the personal subject interview. Review of a personal subject interview for accuracy requires careful reading, often requires review of personal financial files, and is best done in a non-confrontational atmosphere instead of the tense and sometimes intimidating atmosphere of an adversarial hearing. However, I need not rely on the concept of fundamental fairness in this case, because Applicant was unable to authenticate GX 3.

Authentication within the meaning of Directive ¶ E3.1.20 means producing “evidence sufficient to support a finding that the matter in question is what its proponent claims.” Fed. R. Evid. 901(a). GX 3 was offered as an accurate summary of what Applicant said during an interview by a security investigator. However, Applicant disputed its accuracy, and no other evidence was presented to establish that it was what it purported to be, i.e., an accurate summary of the interview.

Under Fed. R. Evid. 613, a witness may be questioned about a prior inconsistent statement, even if the statement is not admissible. Harris v. New York, 401 U.S. 222 (1971). Thus, I permitted Department Counsel to confront Applicant with GX 3 and question him about it. His testimony about GX 3 and his testimony about the events covered in GX 3 was admissible, but the substantive evidence of the events at issue is his testimony, not GX 3.

FINDINGS OF FACT

In his answer to the SOR, Applicant admitted the allegations in SOR ¶¶ 1.a-1.g, with explanations, and he submitted evidence that the debts alleged in SOR ¶¶ 1.b, 1.d, and 1.fwere resolved. His admissions in his answer and at the hearing are incorporated in my findings of fact.

Applicant is a 44-year-old computer-based-training instructor employed by a defense contractor since May 2008. He served on active duty in the U.S. Marine Corps from August 1989 to September 2000 and was honorably discharged. He received a security clearance while in the Marine Corps. In April 2014, he was suspended from his current job without pay, pending a decision on his security clearance. (Tr. 47.)

Applicant married in July 1994. He and his wife have three children, ages 14, 13, and 11. His wife has two adult sons, ages 21 and 25, from a previous relationship, who live with Applicant and his wife because they are financially unable to leave home. (Tr. 46-48.)

Applicant attended a university from August 2000 to August 2001 and a technical college from August 2002 to May 2003, but he did not receive a degree. He was employed in the automotive industry from November 2001 to February 2005. He and his wife purchased a home in November 2003 for $112,000, with no down payment. (Tr. 65, 121.) They financed the purchase with a variable-rate loan for 80% of the purchase price and a second loan for the remaining 20%.2 When they bought the home, they also installed a fence around the home, at a cost of about $3,000, to be paid in monthly $150 installments.3 They were current on the fence payments until they filed a bankruptcy petition. (Tr. 65-67.)

Starting in 2005, Applicant’s work hours were cut due to a downturn in the automotive industry. (Tr. 79-80.) A nationwide downturn in the housing markets was reinforced by a reduction in personnel at a military installation near his home and workplace, as a result of the military base alignment and consolidation (BRAC) program. (Tr. 40.) At the same time, the interest rate on the variable mortgage on their home rose dramatically. Their total payments on both loans rose from about $700 per month to more than $1,000 per month. (Tr. 43.) Furthering their financial distress, Applicant’s wife’s work hours as a dental assistant were cut back as the result of the BRAC reductions, and the dental office eventually closed. (Tr. 81-83.).

In February 2005, Applicant began a new job with a federal contractor, located several hundred miles from the family home. He left his family behind, and worked as an electronic technician for this federal contractor until he began his current employment. He and his family lived apart and maintained two households. (GX 1 at 12- 14; Tr. 34-37.) While they were geographically separated, Applicant relied on his wife to pay the bills for the family home. (Tr. 36-38.) They tried to sell the family home but were unsuccessful because of the downturn in the housing market. (Tr. 40.) They could not refinance because they were upside down on their loans. (Tr. 77.) Applicant minimized the cost of maintaining two households by living in a single rented room. (Tr. 96-97.)

Applicant filed a petition for Chapter 13 bankruptcy in September 2006. The bankruptcy is alleged in SOR ¶ 1.a. The mortgage loan debts on their home were included in the bankruptcy in an effort to avoid foreclosure. Applicant hoped to sell the home, pay off their debts with the profit on the home, and have enough money to make a down payment on a home at his new job location. (Tr. 88-90.) His payment plan was confirmed in October 2006. The plan initially provided for payments of $150 to the trustee. (Tr. 91.) In May 2007, the payments to the bankruptcy trustee were increased to biweekly $300 payments. The record does not reflect the reason for the increased payments. He testified that he asked his attorney if they could remove the mortgage loan debt from the bankruptcy, and he was advised that their only option was to dismiss the bankruptcy. (Tr. 93.)

On August 13, 2007, the trustee filed a motion to show cause for failure to make the required payments for May through July 2007. After a hearing on September 13, 2007, Applicant and his wife were ordered to resume payments. A second motion to dismiss for failure to make payments was filed on August 21, 2008. The petition for bankruptcy was dismissed on August 24, 2008. When it was dismissed, Applicant was in arrears for $846 and had paid a total of $11,538 to the trustee. (GX 4.) He testified that he made $650 payments to the bankruptcy trustee from January to June 2008, and he proffered six carbon copies of the checks from his checkbook. (Tr. 107.) He was unable to produce evidence that the checks were sent and negotiated. However, he produced canceled checks reflecting that he made payments of $288.48 and $845.44 to the mortgage lender in February 2008 and payments of $791.12 and $288.48 in March 2008. (AX G; AX H.)

While living apart, Applicant and his wife decided to divorce. After filing the divorce petition and incurring legal expenses in an amount not reflected in the record, they reconciled and decided to move the family to Applicant’s work location. The family moved to the new job location in November 2006. In 2008, they decided to allow the mortgage on the family home to be foreclosed. While the home was unoccupied, it was vandalized. After the lender declared the home a “natural disaster,” the insurance company paid the lender for the damage, and the lender applied the insurance proceeds to the balance due on the mortgage loan and charged off the balance. (GX 1 at 38-39; GX 2 at 8-9; Tr. 39-40.) The lender foreclosed on this property, which was sold for $154,000 in March 2010. (GX 2 at 6; AX H.)

Applicant testified that he dealt with his creditors individually after the bankruptcy was dismissed, and that all the debts included in the bankruptcy either had been resolved or were being resolved, to the best of his knowledge. (Tr. 110-12.) The evidence concerning the delinquent debts alleged in the SOR is summarized below.

SOR ¶ 1.b, collection account for unpaid utilities, $122. This debt was for unpaid utilities in the family home on which the mortgage loan was foreclosed. It was paid in May 2014. (Answer to SOR, Enclosure 3; AX L; AX M at 2.)

SOR ¶ 1.c, collection account for unpaid cell phone bill, $1,018. Applicant contacted the creditor and determined that this debt was a cell phone account that Applicant opened for his two stepsons. It was included in the bankruptcy and is unresolved. (Tr. 57.)

SOR ¶ 1.d, collection account for unpaid medical bill, $206. This debt was paid in May 2014. (Answer to SOR, Enclosure 2.)

SOR ¶ 1.e, mortgage loan payments past due for $21,311, with total balance on the loan of $96,097. The mortgage was foreclosed and the property sold for $154,000, which is more than the balance on the debt.4 Applicant did not receive an IRS Form 1099-A or 1099-C, reflecting a foreclosure sale.5 (Tr. 123-25, 127.)

SOR ¶ 1.f, collection account for medical bill, $67. This debt was paid in May 2014. (Answer to SOR, Enclosure 1; AX I.)

SOR 1.g, collection account for unpaid water bill, $220. This debt was the final water bill on the family home on which the mortgage loan was foreclosed. Applicant testified that he called the telephone number listed on his credit report and found that it goes directly to voice mail. He left a message, but received no response. In his post- hearing submission, he stated that he had paid the bill and received a receipt, but he attached the receipt for the medical bill in SOR ¶ 1.frather than the receipt for this debt. (AX G; AX I.)

The debts in SOR ¶ 1.b, 1.d, and 1.fwere paid when Applicant received his income tax refund. (Tr. 62.) Before he was suspended, his pay was being garnished for $500 biweekly for the fence that he installed around the family home before the loan was foreclosed and the property was sold. (Tr. 62.) He notified the creditor’s lawyer that the garnishment would be interrupted because he was suspended without pay. He owed about $1,000 on this debt when garnishment was suspended. (Tr. 65-66.) This debt was included in the bankruptcy, but it is not alleged in the SOR.

In July 2014, after Applicant was suspended without pay for three months, he found another job. The defense contractor for whom he worked until April 2014 is holding his job open if his security clearance is continued. (Tr. 46-47.) However, he now earns $15 per hour instead of the $30 per hour he earned as a contractor employee. He is working ten hours a day, six days a week. (Tr. 112.) His wife works four days a week as a part-time dental assistant. (Tr. 44, 112.)

Applicant testified that he has a family budget, but it consists only of a list of expenses in the back of his checkbook. He keeps his list of expenses “either written down on a piece of paper or in [his] head.” He and his family are living paycheck to paycheck. (Tr. 114-15.)

Applicant’s operations manager, who has known him for eight years and regards him as a close friend, describes him as a person of good moral character and, “incredibly responsible.” He is aware of Applicant’s financial problems and is confident that he will “do whatever it takes” to resolve his debts. He states, “I feel strongly about [Applicant], his work ethic, and about his future with [his employer].” (AX K.)

Applicant’s former operations manager considers him adaptable and capable. He states that Applicant and his team received “countless accolades for professionalism, extensive knowledge, and the ability to motivate trainees.” (AX D.)

Applicant’s supervisor, who has known him for eight years, describes him as a person who makes sound decisions and is well trusted. He states that Applicant “is a man of his word and a man that I trusted and will continue to trust.” (AX N.)

Applicant’s regional manager considers him a role model for other employees. He describes him as a “loyal, trusted employee who can be counted on to get the job done without supervision.” (AX C.)

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 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 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).

ANALYSIS

Guideline F, Financial Considerations

The SOR alleges that Applicant filed a petition for Chapter 13 bankruptcy in September 2006, which was dismissed in August 2008 (SOR ¶ 1.a). It also alleges the following delinquent debts: a utility bill for $122 (SOR ¶ 1.b); a cell phone bill for $1,018 (SOR ¶ 1.c); medical bill for $206 (SOR¶ 1.d); a mortgage loan past due for $21,311 with a total balance of $96,097 (SOR ¶ 1.e); a medical bill for $67 (SOR ¶ 1.f); and a water bill for $220 (SOR ¶ 1.g).

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).

Applicant’s admissions in his answer to the SOR and at the hearing, corroborated by his credit bureau report and bankruptcy records, establish two disqualifying conditions under this guideline: AG ¶ 19(a) (“inability or unwillingness to satisfy debts”) and AG ¶ 19(c) (“a history of not meeting financial obligations”).

The following mitigating conditions are potentially applicable:

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, or a death, divorce or separation), and the individual acted responsibly under the circumstances;

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; and

AG ¶ 20(d): the individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts.

AG ¶ 20(a) is not fully established. Applicant’s delinquent debts were numerous, and some of them are not yet resolved. However, one of the major contributing circumstances that caused his financial distress was his ill-advised decision to buy a home with no down payment and financed by a variable-rate loan. He has learned his lesson, and that circumstance is not likely to recur.

AG ¶ 20(b) is established. The rise in interest rates on Applicant’s loan was not a circumstance beyond his control, because he voluntarily agreed to a variable-interest loan. However, he encountered numerous circumstances beyond his control: his reduced income due to a downturn in the automotive industry, his wife’s loss of income, the added expense of maintaining two households, the legal expenses involved in the abandoned divorce action, the vandalism of his home while it was unoccupied, the failures of his adult stepsons to pay their cell phone bills, and the reduced marketability of their family home due to the adverse economic impact of the BRAC program. Although Applicant made some financial missteps due to his lack of experience, he acted responsibly under the circumstances. He stayed in contact with the lender on his home loans, he filed a Chapter 13 bankruptcy instead of Chapter 7, and he paid $11,538 to the bankruptcy trustee until he could no longer afford the biweekly $350 payments. He lived frugally while separated from his family. He sought other employment when he was suspended from his job with a defense contractor, and he has worked long hours to generate as much income as possible. Using his limited financial resources, he started resolving his smaller debts first, using an income tax refund to resolve the debts in SOR ¶ 1.b, 1.d, and 1.f. He inadvertently neglected to attach a receipt for payment of the debt in SOR ¶ 1.gto his post-hearing submission, but his candor at and after the hearing, coupled with his documentation of payment of his other debts, convinces me that he resolved the debt in SOR ¶ 1.g.

AG ¶ 20(c) is established. Applicant received legal advice from his bankruptcy attorney and completed the financial counseling required by the bankruptcy court. There are “clear indications” that his financial problems are being resolved. His largest debts were resolved by the foreclosure sale of his home. Both he and his wife are employed. He has resolved the two utility debts related to the home lost to foreclosure. The only unresolved debt alleged in the SOR is the cell phone debt incurred by his two adult stepsons. He was making regular payments on the fence debt, not alleged in the SOR, until he filed his bankruptcy petition. He was within two months of resolving the fence debt when he was suspended, and he notified this debtor of his suspension without pay. He is determined to resolve the fence debt as soon as his financial situation makes it possible. If he is able to return to his job with a defense contractor, he will double his current earnings, greatly enhancing his ability to quickly resolve his remaining debts.

AG ¶ 20(d) is established, for the reasons set out in the above discussion of AG ¶ 20(c) and the following additional considerations. A security clearance adjudication is an evaluation of an individual’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, as a matter of law, 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 an individual 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 has systematically addressed his delinquent debts, starting with the Chapter 13 bankruptcy. He paid more than $11,500 toward resolving his debts through the bankruptcy. When the bankruptcy payments were increased beyond his means, he tried to work directly with his creditors. He is living frugally and working hard. He has resolved several smaller debts, allowing him to focus on the delinquent cell phone bill and the remaining payments on the fence debt.

WHOLE PERSON CONCEPT

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. 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. An 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.

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.

Applicant served honorably for 11 years in the U.S. Marine Corps and has held a security clearance since his Marine Corps service. He has worked for defense contractors for nine years. He has earned the trust and respect of his supervisors. He was candid, sincere, and credible at the hearing. He has a job waiting for him if his security clearance is continued.

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 based on financial considerations. Accordingly, I conclude he has carried his burden of showing that it is clearly consistent with the national interest to continue his eligibility for access to classified information.

FORMAL FINDINGS

I make the following formal findings on the allegations in the SOR:

Paragraph 1, Guideline F (Financial Considerations): FOR APPLICANT

Subparagraphs 1.a-1.g: For Applicant

CONCLUSION

I conclude that it is clearly consistent with the national interest to continue Applicant’s eligibility for a security clearance. Eligibility for access to classified information is granted.

LeRoy F. Foreman Administrative Judge

FOOTNOTES

1 When later cross-examined about GX 3, Applicant repeatedly testified that it was inaccurate. (Tr. 98- I02.) 2 It is not clear from the record whether the interest rate on the 20% loan was variable or fixed. The 20% loan is not alleged in the SOR. 3 The fence appears to have been a safety-related necessity rather than a discretionary purchase, because the home had a swimming pool. (Tr. 89.) 4 I left the record open to enable Department Counsel to submit evidence of the local law regarding deficiency judgments. (Tr. 124-25.) She did not submit any additional evidence. However, the question whether Applicant may be liable for a deficiency appears to be moot, because the sale price of the property exceeded the amount of the debt. 5 It is possible that the IRS Form 1099-A or 1099-C was sent to the family home, where Applicant no longer resided. It is also possible that a Form 1099-C was not issued due to the Mortgage Forgiveness Debt Relief Act of 2007, which provides tax relief for forgiven mortgage debt, between 2007 and 2012, that was used to buy, build, or substantially improve a principal residence or to refinance debt incurred for those purposes.