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Summary

The applicant, a 39-year-old cost analyst, faced security clearance denial under Guideline F due to unresolved financial issues, including multiple bankruptcies and delinquent debts. Despite some improvements in his financial situation since obtaining employment with a federal contractor, the judge found insufficient evidence of a reliable financial track record, leading to the denial of his security clearance eligibility.

Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: Chapter 13 Bankruptcies filed in February 2021 and April 2022, and dismissed in March and July 2022, respectively (1.a). The February 2021 bankruptcy petition listed a $22,214 secured claim for a 2018 sedan and $133,591 in unsecured nonpriority claims (1.b). Chapter 7 Bankruptcy filed in June 2015 and discharged in September 2015 (1.c). Chapter 13 Bankruptcies filed in June 2010 and June 2011 and dismissed in April and September 2011 because Applicant failed to pay required filing fees (1.d). Court records for the 2010 case show unsecured claims totaling $24,473 and secured claims totaling $17,997, including a $16,525 vehicle loan (1.e). Failed to file federal income tax return for tax year 2020 and owed delinquent federal income taxes of about $13,330 for tax year 2020 (1.f). Failed to file state income tax return for tax year 2020 and owed delinquent state taxes of about $1,148 for tax year 2020 (1.g). Indebted to a creditor for two accounts placed for collection for $12,353 and $6,413, respectively (1.h). Indebted to a creditor for an auto loan account past-due in the amount of $7,328 with a balance of $21,967 (1.i). Credit card accounts charged off for $2,477 and $705, respectively (1.j). Credit card accounts charged off for $2,477 and $705, respectively (1.k). Credit card accounts charged off for $2,477 and $705, respectively (1.l). Credit card accounts charged off for $2,477 and $705, respectively (1.m). Credit card accounts charged off for $2,477 and $705, respectively (1.n).

The judge denied the clearance. The government raised disqualifying conditions AG ¶ 19(a), AG ¶ 19(c), AG ¶ 19(f). The judge applied mitigating conditions AG ¶ 20(d), AG ¶ 20(g). The decision turned on the following: The applicant failed to demonstrate a reliable financial track record despite some improvements in his financial situation; The applicant's financial problems were long-standing and ongoing, raising doubts about his reliability and judgment; The applicant did not provide sufficient evidence of a good-faith effort to repay his creditors or resolve his debts.

Why the Applicant Was Denied

• The applicant failed to demonstrate a reliable financial track record despite some improvements in his financial situation.
• The applicant's financial problems were long-standing and ongoing, raising doubts about his reliability and judgment.
• The applicant did not provide sufficient evidence of a good-faith effort to repay his creditors or resolve his debts.

Conditions Referenced

Key Rule Quoted

“Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the adjudicative guidelines.”

Procedural Posture

• SOR issuedDec 9, 2022Identical SOR issued on December 9, 2022, and February 13, 2023.
• Answer filedFeb 21, 2023
• Hearing heldApr 30, 2024Hearing held via video teleconference.
• Decision dateAug 30, 2024

Cite For

• Denial of Security Clearance Due to Unresolved Financial Issues Under Guideline F
• Insufficient Evidence of a Reliable Financial Track Record
• Consideration of Long-standing Financial Problems in Security Clearance Decisions