Yes it's sort of true - the concern here is about being susceptible to blackmail or coercion, which rules out pretty much anyone who has a personal secret which they feel ashamed about or would go to great lengths to keep secret. If you're gay and out, there's no security concern, but if you're in the closet, there is a chance someone could find out and blackmail you into revealing secret information.
This also applies to people with large amounts of debt - which IIRC is one of the most common reasons people are denied clearance. See here for more info (scroll to "Vulnerability to Coercion"): http://www.dhra.mil/perserec/adr/falsification/falsification...
The debt issues has less to do with blackmail, and more to do with having serious financial strains. They're concerned you'll sell information in exchange for money so that you can pay off your debts. It's the same for drug addiction and gambling.
I think there was a guy that was caught spying recently that had a gambling addiction.
Same thing. Image you are Iran. If you have 10 people to pick from to bribe and ask to work for you. Pick the one with largest dept and offer to pay that debt in return for co-operation.
This also applies to people with large amounts of debt - which IIRC is one of the most common reasons people are denied clearance. See here for more info (scroll to "Vulnerability to Coercion"): http://www.dhra.mil/perserec/adr/falsification/falsification...