ISCR Case 22-01382

Case Headnote

ISCR Case No. 22-01382

deniedSep 8, 2023· Hon. Stephanie C. Hess· hearing

Summary

A 40-year-old logistics specialist, sponsored by a defense contractor, was denied a security clearance under Guideline F (Financial Considerations) due to over $55,000 in unresolved debts. The applicant faced several allegations, including a $40,308 charged-off vehicle loan resulting from a loss of income in spring 2020, for which no payments or arrangements had been made. Other debts included a $4,203 collection for alleged overcharges on a previous rental, a $3,908 dental bill disputed due to unresolved issues with braces, and a $3,764 debt from his current apartment complex related to a former spouse's delayed move-out.

Additional debts included a $2,343 housing complex bill from a previous station, which the applicant claimed he was cleared of, a $686 cellular telephone bill disputed as an overcharge, and a $145 medical account that the applicant believed should have been covered by the VA. While some debts were disputed and did not appear on recent credit reports, the judge found that the applicant failed to demonstrate a good-faith effort to resolve the most significant financial obligations.

Ultimately, the security clearance was denied because the applicant had unresolved debts totaling over $55,000, including the substantial vehicle loan. The applicant did not provide evidence of a good-faith effort to resolve these debts, particularly the largest one, and his disputes regarding some accounts were not formally documented or acted upon, failing to demonstrate responsible financial behavior.

Why the Applicant Was Denied

The applicant has unresolved debts totaling over $55,000, including a significant vehicle loan debt of $40,308 that remains unpaid.
The applicant did not provide evidence of a good-faith effort to resolve his debts, particularly the largest one.
The applicant's disputes regarding some debts were not formally documented or acted upon, failing to demonstrate responsible financial behavior.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability to Satisfy Debts
AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(a)rejectedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to Recur
AG ¶ 20(b)rejectedThe 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 Counseling
AG ¶ 20(d)rejectedThe Individual Initiated and Is Adhering to a Good-faith Effort to Repay Overdue Creditors
AG ¶ 20(e)rejectedThe Individual Has a Reasonable Basis to Dispute the Legitimacy of the Past-due Debt

Key Rule Quoted

“[N]o one has a ‘right’ to a security clearance.”
— Department of the Navy v. Egan, 484 U.S. 518, 528 (1988)

Procedural Posture

SOR issuedAug 11, 2022
Answer filedJan 2, 2023
Hearing held—Applicant requested a decision on the record without a hearing.
Decision dateSep 8, 2023

Cite For

Denial of Security Clearance Due to Unresolved Financial Issues Under Guideline F
Lack of Good-faith Effort to Resolve Significant Debts
Disqualification Based on Inability to Satisfy Debts and History of Not Meeting Financial Obligations

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	$40,308 – charged off. Applicant stated that he had his vehicle repossessed due to his loss of income in spring 2020. He has not paid this debt nor has he made any payment arrangements. $40,308	Against Applicant	Auto Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	$4,203 – collection. Applicant stated that he was never late on his rent and that when he moved out, he was overcharged for cleaning and repairs. $4,203	For Applicant	Unspecified Financial	Admitted	—	—	—
1.c	$3,908. Applicant stated that he had braces put on his teeth that were causing him issues. He contacted the dental clinic which refused to address the issues. He then asked for the dental clinic to remove the braces, but the clinic would not do so until Applicant paid his balance in full. $3,908	Against Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	$3,764. Applicant explained that the creditor of this debt is the apartment complex where Applicant currently resides. His former spouse was supposed to move out of their previously shared apartment in the complex on a specific date but did not do so. $3,764	For Applicant	Unspecified Financial	Admitted	—	—	—
1.e	$2,343. Applicant stated that the creditor of this debt is a housing complex where Applicant was stationed. When he moved out, he was current on the rent and was cleared by the housing office. $2,343	For Applicant	Unspecified Financial	Denied	—	—	—
1.f	$686. This debt is owed to a cellular telephone carrier. Applicant stated that he changed carriers and received a bill for approximately $300 for one month of service. $686	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	$145. Applicant stated that this medical account should have been covered by the U.S. Department of Veterans Affairs (VA). $145	For Applicant	Unspecified Financial	Denied	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

$40,308 – charged off. Applicant stated that he had his vehicle repossessed due to his loss of income in spring 2020. He has not paid this debt nor has he made any payment arrangements.

$40,308

Against Applicant

Auto Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.b

$4,203 – collection. Applicant stated that he was never late on his rent and that when he moved out, he was overcharged for cleaning and repairs.

$4,203

For Applicant

Unspecified Financial

Admitted

—

1.c

$3,908. Applicant stated that he had braces put on his teeth that were causing him issues. He contacted the dental clinic which refused to address the issues. He then asked for the dental clinic to remove the braces, but the clinic would not do so until Applicant paid his balance in full.

$3,908

Against Applicant

Medical Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.d

$3,764. Applicant explained that the creditor of this debt is the apartment complex where Applicant currently resides. His former spouse was supposed to move out of their previously shared apartment in the complex on a specific date but did not do so.

$3,764

For Applicant

Unspecified Financial

Admitted

—

1.e

$2,343. Applicant stated that the creditor of this debt is a housing complex where Applicant was stationed. When he moved out, he was current on the rent and was cleared by the housing office.

$2,343

For Applicant

Unspecified Financial

Denied

—

1.f

$686. This debt is owed to a cellular telephone carrier. Applicant stated that he changed carriers and received a bill for approximately $300 for one month of service.

$686

Against Applicant

Unspecified Financial

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.g

$145. Applicant stated that this medical account should have been covered by the U.S. Department of Veterans Affairs (VA).

$145

For Applicant

Unspecified Financial

Denied

—

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Summary

Why the Applicant Was Denied

Conditions Referenced

Key Rule Quoted

Procedural Posture

Cite For

Full decision