Summary
The applicant, a 50-year-old defense contractor employee, faced trustworthiness concerns under Guidelines E (personal conduct) and F (financial considerations) due to a history of unpaid taxes and delinquent debts. Although he refuted the personal conduct allegations, the judge found insufficient evidence to mitigate the financial issues, leading to a denial of eligibility for access to sensitive information.
Under Guideline E (Personal Conduct) and Guideline F (Financial Considerations), the Statement of Reasons alleged the following: SOR ¶ 1.a alleges a collection account of $17,108. This reflects a lease of a car that Applicant was unable to pay after he was hit by a car. The car was repossessed. The March 2016 credit report lists the account as $707 past due with a balance of $17,108. The February 2018 credit report lists the account as a voluntary surrender with an $8,487 balance (1.a). Applicant’s child support payments are garnished from his pay. The January 2015 credit report lists the payments as $1,284 past due with a balance of the same. The payments were not made while he was out of work after the car accident. The March 2016 credit report lists a balance of $1,605 (1.b). SOR ¶ 1.c and 1.n appear to be the same accounts to a cable television provider. The January 2015 credit report lists the debt as a collection account with a $135 balance. The March 2016 credit report lists a balance of $735, but the February 2018 credit report lists the balance as $402 (1.c). The SOR alleges five medical debts, but the debts alleged in SOR ¶¶ 1.d and 1.m appear to be duplicates. The four non-duplicate debts (SOR ¶¶ 1.d-1.f, 1.k, 1.p) total about $830. The $110 debt alleged in SOR ¶¶ 1.f is the only medical debt listed on the February 2018 credit report, but the creditor is not identified in the SOR or the credit report (1.d). Applicant’s state filed the following tax liens against him: $1,465 in 2007 (SOR ¶ 1.g); $3,493 in 2013 (SOR ¶ 1.h); $4,030 in 2013 (SOR ¶ 1.i); and $4,306 in 2013 (SOR ¶ 1.j) (1.g). Applicant’s state filed the following tax liens against him: $1,465 in 2007 (SOR ¶ 1.g); $3,493 in 2013 (SOR ¶ 1.h); $4,030 in 2013 (SOR ¶ 1.i); and $4,306 in 2013 (SOR ¶ 1.j) (1.h). Applicant’s state filed the following tax liens against him: $1,465 in 2007 (SOR ¶ 1.g); $3,493 in 2013 (SOR ¶ 1.h); $4,030 in 2013 (SOR ¶ 1.i); and $4,306 in 2013 (SOR ¶ 1.j) (1.i). Applicant’s state filed the following tax liens against him: $1,465 in 2007 (SOR ¶ 1.g); $3,493 in 2013 (SOR ¶ 1.h); $4,030 in 2013 (SOR ¶ 1.i); and $4,306 in 2013 (SOR ¶ 1.j) (1.j). SOR ¶ 1.l alleges a charged-off debt without a balance. The January 2015 credit report lists the account as charged off and purchased by another lender, with a $0 balance. The debt is not listed on the two most recent credit reports (1.l). Applicant denied owing the $65 debt to a collection company on behalf of a city (SOR ¶ 1.o). The debt is reported by TransUnion on the January 2015 credit report. It is not listed on the two more recent Equifax credit reports (1.o). Applicant has a history of not filing his state and federal tax returns and paying his taxes when they were due (1.q). Applicant has a history of not filing his state and federal tax returns and paying his taxes when they were due (1.r). Applicant’s tax issues go back a decade. The 2009 through 2013 federal returns have been filed, but the 2014 return had still not been filed as of February 2017. He owes a considerable amount to his state and the IRS, including for 2015, 2016, and likely 2017 (1.s).
The judge denied the clearance. The government raised disqualifying conditions F.19(a), F.19(c), F.19(f). The judge applied mitigating conditions F.20(g). The decision turned on the following: The applicant has a history of not filing tax returns and failing to pay taxes when due; The applicant's financial problems are ongoing and have not been resolved in a reasonable period; The applicant's intentions to pay debts in the future do not substitute for a track record of debt repayment.
Why the Applicant Was Denied
- The applicant has a history of not filing tax returns and failing to pay taxes when due.
- The applicant's financial problems are ongoing and have not been resolved in a reasonable period.
- The applicant's intentions to pay debts in the future do not substitute for a track record of debt repayment.
Conditions Referenced
- F.19(a)raisedInability to Satisfy Debts
- F.19(c)raisedA History of Not Meeting Financial Obligations
- F.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
- F.20(g)appliedThe Individual Has Made Arrangements with the Appropriate Tax Authority to File or Pay the Amount Owed and Is in Compliance with Those ArrangementsThe applicant filed tax returns from 2009 through 2013, but this was insufficient to mitigate the judgment issues.
Key Rule Quoted
“A person who seeks access to sensitive information enters into a fiduciary relationship with the Government predicated upon trust and confidence.”
Procedural Posture
- SOR issuedMar 24, 2017
- Answer filedApr 27, 2017
- Hearing heldMar 20, 2018rescheduled from February 14, 2018
- Decision dateMay 29, 2018
Cite For
- Insufficient Evidence to Mitigate Ongoing Financial Issues Under Guideline F
- Refutation of Personal Conduct Allegations Under Guideline E
- Importance of a Track Record of Debt Repayment for Trustworthiness Evaluations