PSH-21-0087

*The original of this document contains information which is subject to withholding from disclosure
under 5 U.S. C. § 552. Such material has been deleted from this copy and replaced with XXXXXX’s.
United States Department of Energy
Office of Hearings and Appeals
In the Matter of: Personnel Security Hearing )
)
Filing Date: July 21, 2021 ) Case No.: PSH-21-0087
)
__________________________________________)
Issued: March 21, 2022
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Administrative Judge Decision
___________________________
Steven L. Fine, Administrative Judge:
This Decision concerns the eligibility of XXXXX XXXXX (the Individual) to hold an access
authorization under the United States Department of Energy’s (DOE) regulations, set forth at 10
C.F.R. Part 710, “Procedures for Determining Eligibility for Access to Classified Matter and
Special Nuclear Material.”1 As discussed below, after carefully considering the record before me
in light of the relevant regulations and the National Security Adjudicative Guidelines for
Determining Eligibility for Access to Classified Information or Eligibility to Hold a Sensitive
Position (June 8, 2017) (Adjudicative Guidelines), I conclude that the Individual’s access
authorization should be restored.
I. Background
On April 15, 2019, an Office of Personnel Management (OPM) investigator conducted an
Enhanced Subject Interview (ESI) of the Individual. During this ESI, the Individual reported that
she had entered into an installment agreement with the Internal Revenue Service (IRS) for payment
of approximately $7,000 in delinquent taxes from tax years 2015 and 2016. Ex. 15 at 52.
On December 23, 2019, a Local Security Office (LSO) issued a Letter of Interrogatory (LOI) to
the Individual. Ex. 9 at 1. The Individual submitted her response to the December 23, 2019, LOI
on December 24, 2019, acknowledging that she owed the IRS $8,845.10 for delinquent taxes for
tax years 2015, 2016, 2017, and 2018. Ex. 9 at 1-2, 12. She further indicated that she had entered
1 The regulations define access authorization as “an administrative determination that an individual is eligible for access
to classified matter or is eligible for access to, or control over, special nuclear material.” 10 C.F.R. § 710.5(a). This
Decision will refer to such authorization as access authorization or security clearance.
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into an installment agreement with the IRS for payment of these delinquent taxes, requiring her to
pay $250 a month. Ex. 9 at 1. The Individual attributed her tax delinquencies to her failure to
withhold enough from her paychecks. Ex. 9 at 2.
On January 23, 2020, the LSO obtained a credit report for the Individual, indicating that she owed
$81,160 in outstanding credit card debt and personal loans, however, the credit report indicated
that none of this debt was past due. Ex. 11 at 1-11.
On March 5, 2020, the LSO issued a second LOI to the Individual. Ex. 8 at 1. The Individual
submitted her response to this LOI on March 12, 2020, in which she admitted that she had made
large withdrawals from ATM machines located in casinos. Ex. 8 at 3. However, she claimed that
she had used these withdrawals to pay other expenses including food, bus fare, and entertainment.
Ex. 8 at 3. The Individual again acknowledged that she owed the IRS $8,845 for delinquent tax
payments, which she again attributed to inadequate withholding from her paychecks. Ex. 8 at 4.
She further indicated that she had increased her withholding to address this issue. Ex. 8 at 4. She
described her current financial status as “stable.” Ex. 8 at 4. At the LSO’s request, the Individual
completed and submitted a Personal Financial Statement (PFS) on March 12, 2020. Ex. 12 at 1.
The Individual’s PFS indicated that her net monthly income was $6,691 while claiming that her
monthly expenses totaled $926.00.2 Ex. 12 at 1.
Prompted by its concern regarding the Individual’s finances, the LSO requested that the Individual
undergo an evaluation by a DOE-contractor Psychologist (Psychologist) who conducted a clinical
interview (CI) of the Individual on September 4, 2020. Ex. 13 at 2. After conducting the CI,
reviewing the Individual’s Personnel Security File, and administering a standardized
psychological test to the Individual,3 the Psychologist issued a report (the Report) on September
8, 2020. Ex. 13 at 2, 10. In the Report, the Psychologist noted that the Individual exhibited “a
pattern of maladaptive choices, denial in the face of reality, and poor judgment which dates back
many years.” Ex. 13 at 8. The Psychologist further opined that the Individual “has a history of
over-spending and using loans and credit cards to supplement her income” and had “exhibited a
pattern of chronically poor judgment in her finances for which she has, for many years, sought
loans and additional credit cards.” Ex. 13 at 8-9. She noted that “the causes for her indebtedness
[are] not clear based upon her explanations,” and expressed a concern that gambling might have
caused the Individual’s financial issues. Ex. 13 at 9. Finally, the Psychologist stated:
[The Individual] has demonstrated irrational, illogical thinking about her finances
which has impaired her judgment regarding the extent of her debt. She has utilized
mental defenses of denial, minimization, and avoidance which, over time,
consistently fail and prevent resolution of problems. While it is difficult to provide
a prognosis with medical confidence, [the Individual] would most likely make
2 During the present proceeding, the Individual has repeatedly provided inconsistent information concerning her
finances. Some of these inconsistencies may have resulted from changes over time. Other inconsistencies may have
resulted from the Individual’s poor attention to her financial details. My findings on this case are based upon
documentation such as her credit reports, her actual tax return, and an IRS website.
3 The Minnesota Multiphasic Personality Inventory Restructured Form (MMPI-2-RF) was administered to the
Individual.
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progress in addressing her issues if she entered counseling with a therapist who
could help her address underlying motivations for her pattern of financial
mismanagement, and consulted with a financial planner who held her accountable
to a realistic plan, in which case her prognosis would be good. Otherwise, given the
length of time and extent of debt she has developed, and the attitude and mental
condition involved for her, the situation would be unlikely to change and the
prognosis would be guarded.
Ex. 13 at 9.
After receiving the Report, the LSO began the present administrative review proceeding by issuing
a Notification Letter to the Individual, informing her that she was entitled to a hearing before an
Administrative Judge to resolve the substantial doubt regarding her eligibility to hold a security
clearance. See 10 C.F.R. § 710.21.
The Individual requested a hearing, and the LSO forwarded her request to the Office of Hearings
and Appeals (OHA). The Director of OHA appointed me as the Administrative Judge in this
matter. At the hearing I convened pursuant to 10 C.F.R. § 710.25(d), (e), and (g), I took testimony
from four witnesses: the Individual, her investment advisor (the Advisor), her counselor (the
Counselor), and the Psychologist. See Transcript of Hearing, Case No. PSH-21-0087 (hereinafter
cited as “Tr.”). The LSO submitted 15 exhibits, marked as Exhibits 1 through 15 (hereinafter cited
as “Ex.”). The Individual submitted seven exhibits, marked as Exhibits A through G. A summary
of these Exhibits is described below.
Ex. A is a credit report, dated September 8, 2021, from one of the three major credit reporting
agencies. Ex. A at 1. This report indicates that the Individual has a FICO score of 700,4 and has
no current delinquent debt. Ex. A at 1. The credit report indicates that the Individual’s total
outstanding debt on September 8, 2021, was $48,910. Ex. A at 1.
Ex. B is a copy of the Individual’s Federal tax return for tax year 2020. Ex. B at 1. It shows that
the Individual’s Adjusted Gross income for tax year 2020 was $128,560. Ex. B at 1.
Ex. C is a copy of the Individual’s state tax return for tax year 2020. Ex. C at 1. It shows that the
Individual’s Adjusted Gross income for tax year 2020 was $128,560. Ex. C at 1.
Ex. D is a copy of Ex. 7, a case evaluation prepared by the LSO on October 15, 2019, while Ex. E
is a copy of Ex. 8, a case evaluation prepared by the LSO on March 12, 2020.
Ex. F is a copy of an IRS webpage showing that the Individual did not have any unpaid tax
obligations to the IRS as of March 2, 2022. Ex. F at 1.
4 According to Equifax’s website: “generally credit scores from 580 to 669 are considered fair; 670 to 739 are
considered good; 740 to 799 are considered very good; and 800 and up are considered excellent.”
https://www.equifax.com/personal/education/credit/score/what-is-a-good-credit-score/
4
Ex. G appears to be a spreadsheet, prepared by the Individual, indicating the outstanding balances
for each of her outstanding debts and her average monthly payments to each of her creditors as
well as her monthly expenses including her telephone bill, utilities, car insurance, internet service,
and trash pickup. Ex. G at 1. Ex. G indicates that the Individual’s outstanding debt was $46,740
as of March 9, 2022, and that her average monthly expenses are $2,668. 5
II. The Notification Letter and the Associated Security Concerns
As indicated above, the Notification Letter informed the Individual that information in the
possession of the DOE created substantial doubt concerning her eligibility for a security clearance.
In support of this determination, the LSO cited Guideline F of the National Security Adjudicative
Guidelines for Determining Eligibility for Access to Classified Information or Eligibility to Hold
a Sensitive Position, effective June 8, 2017 (Adjudicative Guidelines). Under Guideline F, the LSO
cited the Individual’s outstanding federal tax debts as well as her substantial credit card and
personal loan debt, which have occurred even though she has $5,765 a month in available
disposable income.6 Guideline F (Financial Considerations) provides that an individual’s failure
to live within one’s means, satisfy debts, and meet financial obligations “may indicate poor self-
control, lack of judgment, or unwillingness to abide by rules and regulations, all of which can raise
questions about an individual's reliability, trustworthiness, and ability to protect classified or
sensitive information.” Guideline F at § 18. Guideline F specifically states that “consistent
spending beyond one's means or frivolous or irresponsible spending, which may be indicated by
excessive indebtedness. . .” and “failure to pay annual Federal . . . income tax” are among those
conditions that could raise a security concern and be disqualifying under Guideline F. Guideline
F at § 19(e) and (f). Accordingly, the LSO’s security concerns under Guideline F are justified.
Under Guideline I (Psychological Conditions), the LSO cited the Psychologist’s conclusion that
the Individual has an emotional, mental, or personality condition or conditions that can impair her
judgment, reliability, stability, or trustworthiness. These allegations adequately justify the LSO's
invocation of Guideline I. The Adjudicative Guidelines state: "[c]ertain emotional, mental, or
personality conditions can impair judgement, reliability, or trustworthiness." Guideline I at § 27.
Among those conditions set forth in the Guidelines that could raise a disqualifying security concern
are “behavior that casts doubt on an individual’s' judgment, stability, reliability, or trustworthiness
not covered under any other guideline and that may indicate an emotional, mental, or personality
condition. . .,” and “[a]n opinion by a duly qualified mental health professional that the individual
has a condition that may impair judgement, stability, reliability or trustworthiness.” Guideline I
at §§ 28(a) and (b).
III. Regulatory Standards
A DOE administrative review proceeding under Part 710 requires me, as the Administrative Judge,
to issue a Decision that reflects my comprehensive, common-sense judgment, made after
consideration of all of the relevant evidence, favorable and unfavorable, as to whether the granting
or continuation of a person’s access authorization will not endanger the common defense and
5 I note that this figure appears to exclude groceries, clothing, or medical insurance.
6 This figure is based on her net monthly income of $6,691 less her monthly expenses of $926.00.
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security and is clearly consistent with the national interest. 10 C.F.R. § 710.7(a). The regulatory
standard implies that there is a presumption against granting or restoring a security clearance. See
Department of Navy v. Egan, 484 U.S. 518, 531 (1988) (“clearly consistent with the national
interest” standard for granting security clearances indicates “that security determinations should
err, if they must, on the side of denials”); Dorfmont v. Brown, 913 F.2d 1399, 1403 (9th Cir. 1990)
(strong presumption against the issuance of a security clearance).
An individual must come forward at the hearing with evidence to convince the DOE that granting
or restoring access authorization “will not endanger the common defense and security and will be
clearly consistent with the national interest.” 10 C.F.R. § 710.27(d). The individual is afforded a
full opportunity to present evidence supporting her eligibility for an access authorization. The Part
710 regulations are drafted to permit the introduction of a very broad range of evidence at
personnel security hearings. Even appropriate hearsay evidence may be admitted. 10 C.F.R.
§ 710.26(h). Hence, an individual is afforded the utmost latitude in the presentation of evidence to
mitigate the security concerns at issue.
IV. The Hearing
The Counselor testified at the Hearing that she is a licensed mental health counselor. Tr. at 13.
She initially began meeting with the Individual on a weekly basis on August 11, 2021, and then
transitioned to bi-weekly meetings and then to monthly meetings. Tr. at 16, 25. The Individual’s
attendance was excellent. Tr. at 17. Initially, their focus was addressing the Individual’s concerns
about her security clearance and the grief she was experiencing after recently losing her mother.
Tr. at 18, 40. Eventually, the counseling moved to focusing upon the Individual’s work/life
balance. Tr. at 18, 40. While the Counselor did not feel qualified to provide financial advice to the
Individual, she noted that the Individual exhibited clear thinking about her financial issues during
her therapy sessions. Tr. at 19. The Individual appeared determined to address the issues raised
in the Report. The Counselor noted that she did not observe the Individual engaging in illogical,
irrational thinking about her finances or otherwise exhibiting poor judgment about her finances or
any other matter. Tr. at 19-20, 31. The Counselor never observed any reason to believe that the
Individual was engaged in irresponsible spending or gambling, although the Individual had
informed her that she had a significant amount of debt. Tr. at 39, 41. The Individual reported to
her that she was not making any new purchases. Tr. at 39. The Counselor further testified that
she had not observed the Individual engage in denial, although she had observed some
minimization and avoidance. Tr. at 20-21. The Counselor opined that Individual tended “to put
her work first over her self-care often,” but had made progress in addressing this issue. Tr. at 33.
She noted that the Individual’s counseling did not focus upon addressing the Individual’s
underlying motivations for her pattern of financial mismanagement, but rather addressed the
Individual’s work/life balance and her personal goals. Tr. at 21-22. The Counselor opined that
the Individual had made progress through her counseling. Tr. at 22. The Counselor testified that
the Individual had been candid with her. Tr. at 22, 41-42. She discussed the Psychologist’s
concerns about gambling with the Individual, and the Individual did not believe that she had a
gambling issue. Tr. at 26-27. The Individual informed the Counselor that she no longer goes to
casinos and that she is focused on sorting her finances out. Tr. at 27. The Counselor noted that
the Individual had made progress, responded well to treatment, and was now more effectively
managing her stress. Tr.at 34, 41.
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The Advisor testified at the Hearing that he is a financial advisor with an investment firm, and that
he has 22 years of experience in the financial industry. Tr. at 45-46. He began working with the
Individual in August 2021. Tr. at 47. The Individual sought help with creating a budget and
planning for her retirement. Tr. at 48. The Individual provided him with a large volume of
financial information which enabled him to analyze her current spending needs and to prepare an
investment strategy to fund her retirement. Tr. at 49-50. He assisted the Individual with preparing
a monthly budget. Tr. at 56-57, 65. They developed a plan under which she would “make
systematic deposits to increase her overall savings, and then to be able to sustain her current
standard of living and pay down her debt a little bit faster by isolating what payments would be
most beneficial to her to put her overpayments towards.” Tr. at 50. They also developed a debt
payment strategy for her that would eventually allow her to have sufficient disposable income to
allow her to invest and increase her 401(k) contributions. Tr. at 50. The Advisor stated that the
Individual obviously put a great deal of effort into gathering her financial information. Tr. at 50-
51. The Advisor characterized the Individual’s debt issues as “very common.” Tr. at 54. The
Individual provided him with documentation indicating that she had increased her 401(k)
contributions. Tr. at 55. He provided the Individual with software to facilitate her financial
planning. Tr. at 57.
The Individual testified that she had reduced the number of exemptions that she was claiming to
avoid future problems with the IRS. Tr. at 84. After she received the Report, the Individual began
counseling and meeting with the Advisor. Tr. at 84-85. She testified that she paid off her entire
remaining debt to the IRS in February 2021 and currently owes no money to the IRS. Tr. at 85,
135. She has managed to pay off much of her other outstanding debt, and only has two more car
payments due. Tr. at 86. She testified that her FICO score was 700 in September 2021, and that
her total debt was $48,910 at that time and is now lower. Tr. at 87-88. On the advice of the
Advisor, she has minimized her credit card use. Tr. at 88. She noted that her credit report indicates
that her payment history on several accounts is “exceptional.” Tr. at 89-90. She testified that she
has not been to a casino since August 2021 and plans to continue avoiding casinos in the future.
Tr. at 90-91, 135. She has stopped gambling. Tr. at 93. The Counselor has helped her learn to
use her free time for activities other than gambling, such as gardening. Tr. at 95. She testified that
she no longer has any personal loan debt but still owes about $40,000 in credit card debt. Tr. at
104. The Individual testified that her pay rate has recently increased to $70 per hour. Tr. at 107.
Her monthly take home pay is “about” $5,700. Tr. at 108. She does not have a mortgage and
owns her home free and clear. Tr. at 108, 132. After paying her monthly bills, including her credit
card payments, she still has about $1,200 left over. Tr. at 109, 115. She also makes monthly
payments to her savings account towards her goal of having an emergency reserve of $17,000. Tr.
at 116-17. Her emergency reserve is now $11,000. Tr. at 117. Her aim is to completely pay-off
her credit card debt. Tr. at 118-119. She has been able to pay off about $40,000 in debt during
the past six months. Tr. at 119. While she has had a lot of debt, she does not miss payments. Tr.
at 133. She is current on all her credit card debt. Tr. at 134. In addition, she has recently inherited
some valuable real estate which she hopes to sell. Tr. at 137.
Prior to providing her testimony at the Hearing, the Psychologist observed the testimony provided
by the other three witnesses, including the Individual. Tr. at 148. The Psychologist opined that
she now believes that the Individual’s prognosis is “good.” Tr. at 149. She now believes that the
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Individual is “addressing her finances in a reasonable, logical, rational manner, which would not
require intervention. Tr. at 149. She believes that the Individual has now demonstrated
reformation. Tr. at 149.
V. Analysis
In essence, the Notification Letter7 raised four security concerns. The first security concern was
raised by the Individual’s outstanding debt to the IRS. However, this concern was first mitigated
when the Individual entered a repayment plan with the IRS, and then further mitigated when the
Individual paid this debt in full. The second security concern was raised by the extremely poor
judgment exhibited by the Individual when she purposely claimed too many exemptions in order
to reduce her tax withholdings from her paycheck. However, the Individual mitigated this concern
by stopping this practice, and claiming only one exemption. The third security concern was raised
by the Individual’s accumulation of over $80,000 of credit card and personal loan debt. However,
the Individual has shown that she obtained financial advice, changed her behavior, and reduced
her debt from $81,160 to $46,740. Finally, the Psychologist, noting the Individual’s financial
predicament, raised a concern about her judgment, reliability, and trustworthiness, and
recommended that she receive behavioral and financial counseling. The Individual, however, has
mitigated this concern by complying with the Psychologist’s recommendations and the
Psychologist provided further mitigation of this concern by testifying at the hearing that the
Individual had shown reformation.
Guideline F
The Adjudicative Guidelines provide that an individual can mitigate security concerns under
Guideline F if “the individual has received or is receiving financial counseling for the problem
from a legitimate and credible source . . . and there are clear indications that the problem is being
resolved or is under control.” Guideline F at § 20(c). In the present case, the Individual has shown
that she received financial advice from the Advisor, who helped her develop a financial plan to
address her outstanding debts. The evidence in the record showing that she had paid the IRS in
full and has reduced her debt from $81,160 to $46,740 demonstrates the effectiveness of this advice
and provides a clear indication that her debt issues are under control. Moreover, she now claims
an appropriate number of exemptions for her tax withholdings and has therefore resolved the issues
arising from her former practice of claiming too many exemptions. Accordingly, I find that the
mitigating condition set forth at § 20(c) is present in the instant case.
The Adjudicative Guidelines further provide that an individual can mitigate security concerns
under Guideline F if “The individual has made arrangements with the appropriate tax authority to
file or pay the amount owed and is in compliance with those arrangements.” Guideline F at
§ 20(d). The Individual first entered into a repayment plan with the IRS, and then paid the IRS in
full. Accordingly, the mitigating condition set forth at § 20(c) is present in the instant case.
For these reasons, I find that the Individual has resolved the security concerns raised under
Guideline F.
7 I note that at the time that the Notification Letter was issued, the Individual was not past due on any of her obligations.
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Guideline I
The Adjudicative Guidelines provide that an individual may mitigate security concerns under
Guideline I if: there is a “recent opinion by a duly qualified mental health professional employed
by, or acceptable to and approved by, the U.S. Government that an individual’s previous condition
is under control or in remission and has a low probability of recurrence or exacerbation.”
Guideline I at § 29(c). In the present case, the Psychologist testified at the Hearing that she
believed that the Individual had achieved reformation from her prior poor judgment concerning
her financial affairs and described the Individual’s prognosis as “good.” Based on a review of the
evidence and the testimony presented, I concur in the Psychologist’s assessment. Accordingly,
the mitigating condition set forth at § 29(c) is present in the instant case.
For these reasons, I find that the Individual has resolved the security concerns raised under
Guideline I.
VI. Conclusion
For the reasons set forth above, I conclude that the LSO properly invoked Guidelines F and I. After
considering all the evidence, both favorable and unfavorable, in a commonsense manner, I find
that the Individual has mitigated the security concerns raised under Guidelines F and I.
Accordingly, the Individual has demonstrated that granting her security clearance would not
endanger the common defense and would be clearly consistent with the national interest.
Therefore, the Individual’s security clearance should be restored. The parties may seek review of
this Decision by an Appeal Panel under the procedures set forth at 10 C.F.R. § 710.28.
Steven L. Fine
Administrative Judge
Office of Hearings and Appeals