Summary
The applicant, a DOD contractor employee, sought a security clearance under Guideline F due to significant financial issues, including multiple delinquent debts totaling approximately $47,941 and unpaid federal income taxes. The judge denied the application, citing the applicant's failure to provide evidence of financial responsibility or resolution of debts, despite acknowledging some circumstances beyond his control.
Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: a $12,525 car loan account that was charged off in February 2015 (1.a). a $4,358 car loan account that was charged off in November 2013 (1.b). a $4,743 account that was charged off in September 2015 (1.c). three delinquent medical accounts placed for collection in the amounts of $175 (1.d). three delinquent medical accounts placed for collection in the amounts of $66 (1.e). three delinquent medical accounts placed for collection in the amounts of $221 (1.f). a $25,853 student loan account that was past due in the amount of $831 (1.g). unpaid federal income taxes for tax years 2008, 2010, 2012, and 2013 (1.h).
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(b), AG ¶ 20(a), AG ¶ 20(c), AG ¶ 20(d), AG ¶ 20(e), AG ¶ 20(g). The decision turned on the following: The applicant admitted to all allegations of delinquent debts and failed to provide evidence of payment plans or financial counseling; The applicant's financial irresponsibility over several years raised security concerns regarding his reliability and trustworthiness; The applicant did not demonstrate a good-faith effort to resolve his debts or provide evidence of regular payments.
Why the Applicant Was Denied
- The applicant admitted to all allegations of delinquent debts and failed to provide evidence of payment plans or financial counseling.
- The applicant's financial irresponsibility over several years raised security concerns regarding his reliability and trustworthiness.
- The applicant did not demonstrate a good-faith effort to resolve his debts or provide evidence of regular payments.
Conditions Referenced
- AG ¶ 19(a)raisedInability 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
- AG ¶ 20(b)appliedConditions Largely Beyond the Person's ControlThe applicant experienced periods of unemployment and his wife's health issues contributed to his financial problems.
- AG ¶ 20(a)rejectedBehavior Happened Long Ago or Infrequently
- AG ¶ 20(c)rejectedReceived Financial CounselingThe applicant provided no evidence of financial counseling.
- AG ¶ 20(d)rejectedGood-faith Effort to Repay Overdue CreditorsThe applicant failed to prove he was making regular payments towards his debts.
- AG ¶ 20(e)rejectedReasonable Basis to Dispute Legitimacy of DebtThe applicant did not provide evidence to dispute any debts.
- AG ¶ 20(g)rejectedArrangements with Tax AuthorityThe applicant did not provide proof of a tax repayment plan.
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 issuedDec 9, 2016
- Answer filedJan 4, 2017Requested decision on the record.
- Hearing heldOct 1, 2017Assigned to judge.
- Decision dateNov 9, 2017
Cite For
- Denial of Security Clearance Due to Significant Unresolved Financial Issues
- Importance of Providing Evidence of Financial Responsibility
- Impact of Financial Irresponsibility on Security Clearance Eligibility