Summary
The applicant, a 50-year-old employee of a DOD contractor, sought a security clearance under Guideline F due to a history of financial issues, including failure to file multiple state and federal tax returns and a mortgage foreclosure. The judge denied the application, citing the applicant's ongoing financial irresponsibility and failure to demonstrate good judgment in managing her financial obligations.
Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: failed to timely file her income tax returns in state A for tax years 2007, 2010, 2011, 2012, 2013, and 2014 (1.a). failed to timely file her income taxes in state B for tax years 2010, 2011, 2012, 2013, and 2014 (1.b). failed to timely file her federal income tax returns for tax years 2010, 2011, 2012, and 2013 (1.c). a $7,690 credit card account that was placed for collection in September 2008 (1.d). a $333 medical account that was placed for collection (1.e). a $155 medical account that was placed for collection (1.f). a $117 medical account that was placed for collection (1.g). a $41 medical account that was placed for collection (1.h). lost a house to foreclosure in 2011 (1.i).
The judge denied the clearance. The government raised disqualifying conditions AG ¶ 19(a), AG ¶ 19(c), AG ¶ 19(g). The judge applied mitigating conditions AG ¶ 20(a), AG ¶ 20(b), AG ¶ 20(d). The decision turned on the following: The applicant failed to timely file federal and state income tax returns for multiple years, indicating a lack of compliance with governmental rules; The applicant's financial issues were significant and ongoing, raising concerns about her reliability and trustworthiness; The applicant did not provide sufficient evidence of mitigating circumstances to overcome the disqualifying conditions.
Why the Applicant Was Denied
- The applicant failed to timely file federal and state income tax returns for multiple years, indicating a lack of compliance with governmental rules.
- The applicant's financial issues were significant and ongoing, raising concerns about her reliability and trustworthiness.
- The applicant did not provide sufficient evidence of mitigating circumstances to overcome the disqualifying conditions.
Conditions Referenced
- AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
- AG ¶ 19(c)raisedHistory of Not Meeting Financial Obligations
- AG ¶ 19(g)raisedFailure to File Annual Federal, State, or Local Income Tax Returns as Required
- AG ¶ 20(a)rejectedBehavior Happened so Long Ago, Was Infrequent, or Occurred Under Circumstances Unlikely to RecurThe applicant's financial issues were recent and ongoing.
- AG ¶ 20(b)rejectedConditions That Resulted in Financial Problems Were Largely Beyond the Person's ControlThe applicant's financial issues were primarily due to her own decisions and actions.
- AG ¶ 20(d)rejectedGood-faith Effort to Repay Overdue Creditors or Resolve DebtsThe applicant only began addressing her tax issues after receiving the SOR.
Key Rule Quoted
“Failure to file tax returns suggests that an applicant has a problem with complying with well-established governmental rules and systems.”
Procedural Posture
- SOR issuedSep 16, 2016
- Answer filedOct 5, 2016
- Hearing heldDec 6, 2016
- Decision dateFeb 24, 2017
Cite For
- Failure to File Tax Returns as a Disqualifying Condition Under Guideline F
- Importance of Demonstrating Good Judgment in Financial Matters for Security Clearance Eligibility
- The Relationship Between Financial Irresponsibility and Reliability in Protecting Classified Information