ISCR Case 23-00315

Case Headnote

ISCR Case No. 23-00315

deniedApr 26, 2024· Hon. Erin C. Hogan· hearing

Summary

A 33-year-old DOD contractor was denied a security clearance under Guideline F (Financial Considerations) due to ten delinquent debts totaling approximately $43,998. These debts included two charged-off automobile loans for $14,902 and $17,299, a $3,107 delinquent loan, and a $4,409 delinquent child support debt. Other outstanding obligations included a $489 pet hospital bill, a $366 medical debt, a $2,388 past-due child support debt, a $95 bank debt, and a $515 cell phone account.

While the applicant fully paid a $428 charged-off credit card account, and a credit report indicated the $95 bank debt was resolved, he failed to provide sufficient documentation for other claims, such as regular child support payments. He also stated he did not intend to pay several debts, believing they were too old or no longer on his credit report.

The judge found that the applicant demonstrated a history of financial irresponsibility, failed to provide adequate proof of debt resolution or ongoing payments, and passively waited for debts to become unenforceable. Despite some improvements, the evidence of financial responsibility and stability was deemed insufficient, leading to the denial of his security clearance eligibility.

Why the Applicant Was Denied

The applicant had ten delinquent debts totaling approximately $43,998, indicating a history of financial irresponsibility.
He failed to provide sufficient documentation to prove he was making regular payments towards his child support and other debts.
The applicant passively waited for debts to become unenforceable rather than actively resolving them.

Conditions Referenced

Disqualifying

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

Mitigating

AG ¶ 20(b)appliedConditions Largely Beyond the Person's ControlThe applicant experienced brief periods of unemployment and a divorce, but did not act responsibly under these circumstances.
AG ¶ 20(d)rejectedGood-faith Effort to Repay DebtsThe applicant failed to provide sufficient documentation to prove he was making regular payments towards his debts.

Key Rule Quoted

“An applicant is not required to be debt free but is required to manage his finances in such a way as to meet his financial obligations.”

Procedural Posture

SOR issuedMar 29, 2023
Answer filedMay 2, 2023
Hearing heldFeb 7, 2024via video-teleconference
Decision dateApr 26, 2024

Cite For

Denial of Security Clearance Due to Financial Irresponsibility Under Guideline F
Insufficient Evidence of Financial Stability and Responsibility
Impact of Past Financial Behavior on Current Security Clearance Eligibility

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	a $14,902 charged-off automobile loan: Applicant co-signed the loan for a car with a woman he was dating around the summer 2017. They eventually broke up and his former girlfriend kept the car under the premise that she would continue to make the car payments. She stopped making the car payments. As the co-signer, the bank has the right to collect the loan from Applicant. He first learned of the i $14,902	Against Applicant	Auto Loan Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	a $3,107 delinquent loan placed for collection: Applicant testified he used this loan for a down payment on a car purchase. The loan became delinquent because he did not have the money to make payments. He testified he does not have to pay the account because the debt is over seven years old and it is no longer on his credit report. He does not intend to make payments towards this account because $3,107	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	a $428 charged-off credit card account: Applicant paid this debt in full on June 1, 2023. After the hearing, he provided a receipt from the creditor indicating the debt is paid in full. $428	For Applicant	Credit Card Debt	Admitted	—	—	—
1.d	a $4,409 delinquent child support debt placed for collection: This debt relates to child support for his two daughters from his first marriage. When they first divorced, Applicant sent money to his ex-wife for his children’s expenses. He stopped making direct payments when he learned that he was not given credit through the state child support office. There were times he was unable to pay child su $4,409	Against Applicant	Child Support Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	a $489 pet hospital account placed for collection: Applicant states that this was a bill for treatment of his dog who became very sick. This occurred shortly after he separated from active duty in 2017. He states it is more than seven years old and is no longer on his credit report. He never made payment and is not sure of the status of the account. The debt is unpaid. $489	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	a $366 delinquent medical debt placed for collection: Applicant denies this debt. While on active duty, he had surgery at the base hospital and was issued a scooter to help with his mobility. He claims he returned the scooter to his treatment team. They were supposed to note in the records that he had returned it. They did not do so and he was held liable for the scooter. He believes he does not o $366	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	$2,388 past-due debt owed to the Office of the Attorney General for past-due child support: Applicant claims this is the same child support debt that is alleged in SOR ¶ 1.d. He is making payments. He did not provide documentary proof that shows this is the same child support debt and that he is making regular payments towards this account. $2,388	Against Applicant	Child Support Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	a $95 charged-off debt owed to bank: In his Answer to the SOR, Applicant claims he paid this debt and is waiting for the receipt from the creditor. During the hearing, he said he will obtain proof that the debt was paid. The record was held open to allow him the opportunity to provide a receipt. He did not provide proof the debt was paid. However, a May 2021 credit report lists the account as reso $95	For Applicant	Unspecified Financial	Unknown	—	—	—
1.i	a $17,299 delinquent automobile loan that was charged off: This was a loan Applicant took out in 2015 to purchase a used car. The car broke down. It was too expensive to fix. He did not want to pay for a car that he could not use so he did not make payments on the car loan even though he was responsible for the loan. He testified that the debt is no longer on his credit report and he will not make $17,299	Against Applicant	Auto Loan Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.j	a $515 delinquent cell phone account placed for collection: Applicant claims he co-signed for cell phones for two of his fellow airmen when he was on active duty. His two friends got into trouble and were discharged from the Air Force. They took the phones with them and did not make payments. He did not make payments towards this debt. It is no longer on his credit report so he does not intend to $515	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

a $14,902 charged-off automobile loan: Applicant co-signed the loan for a car with a woman he was dating around the summer 2017. They eventually broke up and his former girlfriend kept the car under the premise that she would continue to make the car payments. She stopped making the car payments. As the co-signer, the bank has the right to collect the loan from Applicant. He first learned of the i

$14,902

Against Applicant

Auto Loan Debt

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.b

a $3,107 delinquent loan placed for collection: Applicant testified he used this loan for a down payment on a car purchase. The loan became delinquent because he did not have the money to make payments. He testified he does not have to pay the account because the debt is over seven years old and it is no longer on his credit report. He does not intend to make payments towards this account because

$3,107

Against Applicant

Unspecified Financial

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.c

a $428 charged-off credit card account: Applicant paid this debt in full on June 1, 2023. After the hearing, he provided a receipt from the creditor indicating the debt is paid in full.

$428

For Applicant

Credit Card Debt

Admitted

—

1.d

a $4,409 delinquent child support debt placed for collection: This debt relates to child support for his two daughters from his first marriage. When they first divorced, Applicant sent money to his ex-wife for his children’s expenses. He stopped making direct payments when he learned that he was not given credit through the state child support office. There were times he was unable to pay child su

$4,409

Against Applicant

Child Support Debt

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.e

a $489 pet hospital account placed for collection: Applicant states that this was a bill for treatment of his dog who became very sick. This occurred shortly after he separated from active duty in 2017. He states it is more than seven years old and is no longer on his credit report. He never made payment and is not sure of the status of the account. The debt is unpaid.

$489

Against Applicant

Unspecified Financial

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.f

a $366 delinquent medical debt placed for collection: Applicant denies this debt. While on active duty, he had surgery at the base hospital and was issued a scooter to help with his mobility. He claims he returned the scooter to his treatment team. They were supposed to note in the records that he had returned it. They did not do so and he was held liable for the scooter. He believes he does not o

$366

Against Applicant

Unspecified Financial

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.g

$2,388 past-due debt owed to the Office of the Attorney General for past-due child support: Applicant claims this is the same child support debt that is alleged in SOR ¶ 1.d. He is making payments. He did not provide documentary proof that shows this is the same child support debt and that he is making regular payments towards this account.

$2,388

Against Applicant

Child Support Debt

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.h

a $95 charged-off debt owed to bank: In his Answer to the SOR, Applicant claims he paid this debt and is waiting for the receipt from the creditor. During the hearing, he said he will obtain proof that the debt was paid. The record was held open to allow him the opportunity to provide a receipt. He did not provide proof the debt was paid. However, a May 2021 credit report lists the account as reso

$95

For Applicant

Unspecified Financial

Unknown

—

1.i

a $17,299 delinquent automobile loan that was charged off: This was a loan Applicant took out in 2015 to purchase a used car. The car broke down. It was too expensive to fix. He did not want to pay for a car that he could not use so he did not make payments on the car loan even though he was responsible for the loan. He testified that the debt is no longer on his credit report and he will not make

$17,299

Against Applicant

Auto Loan Debt

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.j

a $515 delinquent cell phone account placed for collection: Applicant claims he co-signed for cell phones for two of his fellow airmen when he was on active duty. His two friends got into trouble and were discharged from the Air Force. They took the phones with them and did not make payments. He did not make payments towards this debt. It is no longer on his credit report so he does not intend to

$515

Against Applicant

Unspecified Financial

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

Loading case…

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

WHOLE PERSON CONCEPT

FORMAL FINDINGS

CONCLUSION