ISCR Case 24-02074

Case Headnote

ISCR Case No. 24-02074

deniedMay 13, 2025· Hon. Darlene Lokey Anderson· hearing

Summary

A 46-year-old defense contractor with a Bachelor's degree in Business was denied a security clearance under Guideline F, Financial Considerations. The denial stemmed from allegations of financial irresponsibility, including approximately $35,818 in delinquent debts and a failure to timely file tax returns.

Specific allegations included multiple charged-off accounts, such as a $5,052 car loan and a $2,226 credit card, along with several accounts placed for collection, ranging from a $311 gym membership to a $10,369 balance on a repossessed vehicle. The applicant also owed the Federal Government approximately $13,211 for delinquent 2019 taxes and failed to timely file their 2023 Federal income tax return. While some debts were partially addressed or claimed to be paid, such as a $878 account settled in full and a $294 debt paid before the hearing, many remained unresolved.

The administrative judge found that the applicant's financial issues were significant and unresolved. Despite some efforts to address debts, the applicant did not consistently follow through with payment plans and continued to incur debt. Ultimately, the applicant failed to demonstrate sufficient financial responsibility and trustworthiness, leading to the denial of the security clearance.

Why the Applicant Was Denied

The applicant had a history of financial irresponsibility, including significant delinquent debts and failure to file tax returns timely.
Despite some efforts to address debts, the applicant failed to follow through with payment plans and continued to incur debt.
The applicant did not demonstrate sufficient responsibility or trustworthiness to access classified information.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability or Unwillingness 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 That Resulted in the Financial Problem Were Largely Beyond the Person’s ControlWhile the applicant faced unexpected medical emergencies, he continued to incur debt that he knew he could not afford to pay.
AG ¶ 20(d)rejectedThe Individual Initiated and Is Adhering to a Good Faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant failed to follow through with payment plans and did not establish a track record of payment.

Key Rule Quoted

“The protection of the national security is the paramount consideration.”

Procedural Posture

SOR issuedDec 23, 2024
Answer filedJan 16, 2025
Hearing heldApr 17, 2025
Decision dateMay 13, 2025

Cite For

Denial of Security Clearance Due to Unresolved Financial Issues Under Guideline F
Failure to Demonstrate Financial Responsibility and Trustworthiness
Impact of Financial Irresponsibility on 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	Applicant is indebted to a creditor for an account that was charged off in the approximate amount of $5,052. This is a car loan on the automobile that Applicant had the accident in. $5,052	Against Applicant	Auto Loan Debt	Denied	—	—	—
1.b	Applicant is indebted to a creditor for an account that was charged off in the approximate amount of $2,226. This is a credit card account that Applicant opened. $2,226	For Applicant	Credit Card Debt	Admitted	—	—	—
1.c	Applicant is indebted to a creditor for an account that was charged off in the approximate amount of $878. A letter from the collection agency indicates that the account was settled in full. $878	For Applicant	Unspecified Financial	Admitted	—	—	—
1.d	Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $776. Applicant made a payment of $50 towards the debt. $776	Against Applicant	Unspecified Financial	Denied	—	—	—
1.e	Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $565. Applicant opened this credit card to establish credit. $565	Against Applicant	Credit Card Debt	Admitted	—	—	—
1.f	Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $526. Applicant opened this credit card to establish credit. $526	Against Applicant	Credit Card Debt	Denied	—	—	—
1.g	Applicant is indebted to a creditor for an account that was charged off in the approximate amount of $521. Applicant opened this credit card to establish credit. $521	For Applicant	Credit Card Debt	Admitted	—	—	—
1.h	Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $311. This is Applicant's gym membership account. $311	Against Applicant	Unspecified Financial	Denied	—	—	—
1.i	Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $294. Applicant stated that he paid the debt off a few days before the hearing. $294	For Applicant	Unspecified Financial	Admitted	—	—	—
1.j	Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $988. This was the cost of the ambulance service when he was in the car accident in 2018. $988	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.k	Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $101. Applicant claims that he paid the debt and it has been removed from his credit report. $101	For Applicant	Unspecified Financial	Admitted	—	—	—
1.l	Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $10,369 for the balance due on a vehicle that had been repossessed. $10,369	Against Applicant	Auto Loan Debt	Denied	—	—	—
1.m	Applicant is indebted to the Federal Government for delinquent taxes in the amount of approximately $13,211.06 for tax year 2019. $13,211	Against Applicant	Tax Unpaid	Admitted	—	—	—
1.n	Applicant failed to timely file as required his Federal income tax return for tax year 2023.	Against Applicant	Tax Filing Failure	Unknown	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Applicant is indebted to a creditor for an account that was charged off in the approximate amount of $5,052. This is a car loan on the automobile that Applicant had the accident in.

$5,052

Against Applicant

Auto Loan Debt

Denied

—

1.b

Applicant is indebted to a creditor for an account that was charged off in the approximate amount of $2,226. This is a credit card account that Applicant opened.

$2,226

For Applicant

Credit Card Debt

Admitted

—

1.c

Applicant is indebted to a creditor for an account that was charged off in the approximate amount of $878. A letter from the collection agency indicates that the account was settled in full.

$878

For Applicant

Unspecified Financial

Admitted

—

1.d

Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $776. Applicant made a payment of $50 towards the debt.

$776

Against Applicant

Unspecified Financial

Denied

—

1.e

Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $565. Applicant opened this credit card to establish credit.

$565

Against Applicant

Credit Card Debt

Admitted

—

1.f

Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $526. Applicant opened this credit card to establish credit.

$526

Against Applicant

Credit Card Debt

Denied

—

1.g

Applicant is indebted to a creditor for an account that was charged off in the approximate amount of $521. Applicant opened this credit card to establish credit.

$521

For Applicant

Credit Card Debt

Admitted

—

1.h

Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $311. This is Applicant's gym membership account.

$311

Against Applicant

Unspecified Financial

Denied

—

1.i

Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $294. Applicant stated that he paid the debt off a few days before the hearing.

$294

For Applicant

Unspecified Financial

Admitted

—

1.j

Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $988. This was the cost of the ambulance service when he was in the car accident in 2018.

$988

Against Applicant

Unspecified Financial

Admitted

—

1.k

Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $101. Applicant claims that he paid the debt and it has been removed from his credit report.

$101

For Applicant

Unspecified Financial

Admitted

—

1.l

Applicant is indebted to a creditor for an account that was placed for collection in the approximate amount of $10,369 for the balance due on a vehicle that had been repossessed.

$10,369

Against Applicant

Auto Loan Debt

Denied

—

1.m

Applicant is indebted to the Federal Government for delinquent taxes in the amount of approximately $13,211.06 for tax year 2019.

$13,211

Against Applicant

Tax Unpaid

Admitted

—

1.n

Applicant failed to timely file as required his Federal income tax return for tax year 2023.

Against Applicant

Tax Filing Failure

Unknown

—

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Summary

Why the Applicant Was Denied

Conditions Referenced

Key Rule Quoted

Procedural Posture

Cite For

Full decision