Summary
A 50-year-old program manager was denied a security clearance due to significant financial concerns under Guideline F. The applicant had a history of multiple bankruptcies, including a Chapter 13 petition in March 2015, dismissed in March 2016 because unsecured debts exceeded the maximum allowed. A subsequent Chapter 11 petition, filed in March 2016, was dismissed in January 2017.
Further financial issues included unfiled federal income tax returns for 2013 through 2016, resulting in a federal tax debt of $130,324 as of July 2019. State income tax returns for 2014 and 2015 were also not timely filed, leading to an alleged state tax debt of $8,802. The applicant also faced 18 delinquent debts totaling approximately $408,827, which included about $373,763 in delinquent student loans, a $7,020 judgment, $3,360 in past-due settlement payments, and $24,684 in past-due car payments.
Despite some mitigating circumstances, the judge determined that the applicant did not demonstrate sufficient financial responsibility or a viable plan to address his substantial debts. While some financial problems were beyond his control, the applicant did not act responsibly in managing his debts thereafter, leading to the denial of his security clearance.
Why the Applicant Was Denied
- The applicant has a history of multiple bankruptcies and significant tax debts, indicating financial irresponsibility.
- The applicant failed to provide a clear plan to resolve his ongoing financial issues, including federal and state tax debts.
- The applicant's financial problems were exacerbated by circumstances largely beyond his control, but he did not act responsibly in managing his debts thereafter.
Conditions Referenced
- AG ¶ 19(a)appliedInability to Satisfy Debts
- AG ¶ 19(b)appliedUnwillingness to Satisfy Debts Regardless of the Ability to Do So
- AG ¶ 19(c)appliedA History of Not Meeting Financial Obligations
- AG ¶ 19(f)appliedFailure 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
- AG ¶ 20(a)appliedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to Recur
- AG ¶ 20(b)appliedThe Conditions That Resulted in the Financial Problem Were Largely Beyond the Person's Control
- AG ¶ 20(c)rejectedThe Individual Has Received or Is Receiving Financial CounselingAlthough the applicant received financial counseling, his financial problems are not under control.
- AG ¶ 20(d)rejectedThe Individual Initiated and Is Adhering to a Good-faith Effort to Repay Overdue CreditorsThe applicant does not have payment plans in effect for his debts.
- AG ¶ 20(g)rejectedThe Individual Has Made Arrangements with the Appropriate Tax Authority to File or Pay the Amount OwedThe applicant has no current plan to resolve his delinquent federal and state taxes.
Key Rule Quoted
“Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the adjudicative guidelines.”
Procedural Posture
- SOR issuedOct 4, 2019
- Answer filedJan 8, 2020
- Hearing heldSep 10, 2020Hearing was rescheduled due to attorney's request.
- Decision dateNov 16, 2020
Cite For
- Evaluation of Financial Irresponsibility Under Guideline F
- Impact of Multiple Bankruptcies on Security Clearance Eligibility
- Consideration of Mitigating Circumstances in Financial Cases