ISCR Case 19-01236

Case Headnote

ISCR Case No. 19-01236

deniedJan 7, 2020· Hon. Shari Dam· hearing

Summary

A 34-year-old Navy veteran was denied a security clearance under Guideline F (Financial Considerations) due to unresolved financial issues, primarily a $2,570 state tax lien and a history of delinquent debts. The applicant had several allegations of financial mismanagement, including charged-off credit card accounts, debts to a credit union, and an apartment complex.

While the applicant successfully settled and paid several debts, including a $7,758 credit card account settled for $3,491 in September 2019, a $7,550 credit union debt settled for $2,138 in November 2019, and a $6,190 apartment debt settled for $4,344 in June 2019, other issues remained. A $4,078 bank account was settled for $1,506 and paid, and a $2,626 credit union account was settled for $525. Additionally, a $456 utilities collection account was paid in January 2018. The applicant also disputed several other alleged debts, which subsequently did not appear on her credit reports.

However, the applicant failed to resolve a $2,570 state tax lien from June 2018 for tax year 2014 and did not provide evidence of filing her 2014 state income tax return. The judge concluded that the applicant's financial management raised doubts about her reliability and trustworthiness, leading to the denial of her security clearance.

Why the Applicant Was Denied

The applicant did not resolve the $2,570 state tax lien, which was a significant concern.
The applicant failed to file her 2014 state income tax return and did not provide evidence of financial responsibility.
The applicant's financial management raised doubts about her reliability and trustworthiness.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability to Satisfy Debts
AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations
AG ¶ 19(f)raisedFailure to File or Fraudulently Filing Annual Federal, State, or Local Income Tax Returns or Failure to Pay Annual Federal, State, or Local Income Tax as Required

Mitigating

AG ¶ 20(b)rejectedConditions Beyond the Person's ControlThe applicant's financial issues were partly due to her voluntary choices.
AG ¶ 20(c)rejectedReceiving Financial CounselingThe applicant has not participated in financial counseling since leaving military service.
AG ¶ 20(d)appliedGood-faith Effort to Repay Overdue CreditorsThe applicant initiated some repayment plans for certain debts.
AG ¶ 20(e)appliedDispute Legitimacy of Past-due DebtThe applicant successfully disputed several debts that were not hers.
AG ¶ 20(g)rejectedArrangements with Tax AuthorityThe applicant has not established a payment plan for her unpaid state taxes.

Key Rule Quoted

“Any doubt concerning personnel being considered for national security eligibility will be resolved in favor of the national security.”

Procedural Posture

SOR issuedJun 25, 2019
Answer filedAug 1, 2019
Hearing heldNov 13, 2019
Decision dateJan 7, 2020

Cite For

Denial of Security Clearance Due to Unresolved Financial Obligations Under Guideline F
Impact of Tax Liens on Security Clearance Eligibility
Importance of Demonstrating Financial Responsibility for National Security Access

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

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	The $7,758 charged-off credit card account was settled for $3,491 and was paid in September 2019. $3,791	For Applicant	Credit Card Debt	Admitted	—	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.b	The $7,550 debt owed to a credit union was settled for $2,138 and paid on November 14, 2019. $5,412	For Applicant	Credit Card Debt	Admitted	—	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.c	The $6,190 debt owed to an apartment complex was settled for $4,344 and paid in full on June 23, 2019. $1,846	For Applicant	Unspecified Financial	Admitted	—	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.d	The $4,078 charged-off account owed to a bank was settled for $1,506, and is paid. $2,572	For Applicant	Unspecified Financial	Admitted	—	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.e	The $2,626 charged-off account owed to a credit union was settled for $525. $2,101	For Applicant	Unspecified Financial	Admitted	—	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.f	The $418 charged-off debt owed to a retail store was not her debt, and it no longer appears on her November 2019 credit report. $0	For Applicant	Unspecified Financial	Denied	—	—	Claimed Debt Disputed with Creditor
1.g	Applicant denied owing the $385 charged-off credit card debt, which does not appear on her March or November 2019 CBRs. $0	For Applicant	Unspecified Financial	Denied	—	—	Claimed Debt Disputed with Creditor
1.h	Applicant denied owing the $924 collections account debt owed to a cable company, which does not appear on the Government's March 2019 CBR. $0	For Applicant	Unspecified Financial	Denied	—	—	Claimed Debt Disputed with Creditor
1.i	The $456 collections account for utilities is resolved, listed as having been paid in January 2018. $0	For Applicant	Utility or Phone Debt	Admitted	—	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.j	In June 2018, a state filed a tax lien against Applicant for a $2,570 judgment debt for tax year 2014, which remains unresolved. $2,570	Against Applicant	Tax Unpaid	Unknown	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

The $7,758 charged-off credit card account was settled for $3,491 and was paid in September 2019.

$3,791

For Applicant

Credit Card Debt

Admitted

—

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.b

The $7,550 debt owed to a credit union was settled for $2,138 and paid on November 14, 2019.

$5,412

For Applicant

Credit Card Debt

Admitted

—

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.c

The $6,190 debt owed to an apartment complex was settled for $4,344 and paid in full on June 23, 2019.

$1,846

For Applicant

Unspecified Financial

Admitted

—

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.d

The $4,078 charged-off account owed to a bank was settled for $1,506, and is paid.

$2,572

For Applicant

Unspecified Financial

Admitted

—

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.e

The $2,626 charged-off account owed to a credit union was settled for $525.

$2,101

For Applicant

Unspecified Financial

Admitted

—

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.f

The $418 charged-off debt owed to a retail store was not her debt, and it no longer appears on her November 2019 credit report.

For Applicant

Unspecified Financial

Denied

—

Claimed

Debt Disputed with Creditor

1.g

Applicant denied owing the $385 charged-off credit card debt, which does not appear on her March or November 2019 CBRs.

For Applicant

Unspecified Financial

Denied

—

Claimed

Debt Disputed with Creditor

1.h

Applicant denied owing the $924 collections account debt owed to a cable company, which does not appear on the Government's March 2019 CBR.

For Applicant

Unspecified Financial

Denied

—

Claimed

Debt Disputed with Creditor

1.i

The $456 collections account for utilities is resolved, listed as having been paid in January 2018.

For Applicant

Utility or Phone Debt

Admitted

—

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.j

In June 2018, a state filed a tax lien against Applicant for a $2,570 judgment debt for tax year 2014, which remains unresolved.

$2,570

Against Applicant

Tax Unpaid

Unknown

—

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Case Profile

Summary

Why the Applicant Was Denied

Conditions Referenced

Key Rule Quoted

Procedural Posture

Cite For

Full decision

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

APPEARANCES

STATEMENT OF CASE

FINDINGS OF FACT

POLICIES

ANALYSIS

WHOLE PERSON CONCEPT

FORMAL FINDINGS

CONCLUSION