ISCR Case 16-02918.h1

Case Headnote

ISCR Case No. 16-02918.h1

grantedOct 26, 2017· Hon. Richard A. Cefola· hearing

Summary

This security clearance decision involved a 55-year-old married applicant with two adult children, facing concerns under Guideline F (Financial Considerations). The Statement of Reasons (SOR) alleged the existence of federal and state tax liens totaling approximately $14,921, and two Chapter 13 bankruptcy filings.

However, the judge found that the applicant had resolved these financial issues before the SOR was issued. Specifically, both federal and state tax liens were discharged in February 2016, eight months prior to the SOR. The applicant's initial Chapter 13 bankruptcy, filed in July 2011, was dismissed in 2013, leading to a second Chapter 13 filing in November 2013. Payments to the trustee for this second bankruptcy were completed, and the bankruptcy was discharged in February 2017, also eight months before the SOR.

The decision to grant clearance was based on the applicant's timely resolution of all financial issues, demonstrating responsible behavior. The judge also noted that the financial difficulties were largely beyond the applicant's control, and the applicant acted responsibly given the circumstances.

Why the Applicant Prevailed

The applicant satisfied his tax liens and completed bankruptcy payments prior to the SOR issuance.
The financial issues were resolved in a timely manner, demonstrating responsible behavior.
The applicant's financial difficulties were largely beyond his control and he acted responsibly under the circumstances.

Conditions Referenced

Disqualifying

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

Mitigating

AG ¶ 20(a)appliedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to Recur
AG ¶ 20(b)appliedThe Conditions That Resulted in the Financial Problem Were Largely Beyond the Person's Control
AG ¶ 20(d)appliedThe Individual Initiated and Is Adhering to a Good-faith Effort to Repay Overdue Creditors
AG ¶ 20(g)appliedThe Individual Has Made Arrangements with the Appropriate Tax Authority to File or Pay the Amount Owed

Key Rule Quoted

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

Procedural Posture

SOR issuedOct 7, 2016
Answer filedNov 4, 2016
Hearing held—Decided on the written record without a hearing.
Decision dateOct 26, 2017

Cite For

Resolution of Financial Issues Prior to SOR Issuance Under Guideline F
Mitigation of Financial Concerns Due to Responsible Behavior
Application of Whole-person Concept in Financial Considerations Cases

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 denies the existence of Federal and state tax liens totaling about $14,921. Both his Federal and state tax liens were discharged in February of 2016, eight months prior to the issuance of the SOR. This allegation is found for Applicant. $14,921	For Applicant	Tax Unpaid	Denied	—	(g) arrangements made with the tax authority; in compliance	—
1.b	Applicant initially filed for the protection of a Chapter 13 bankruptcy in July of 2011. The original bankruptcy was dismissed in 2013, so that Applicant could refile for the protection of another Chapter 13 bankruptcy in November of that year. These allegations are found for Applicant.	For Applicant	Bankruptcy Filing	Admitted	—	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—
1.c	Applicant’s payments were thus reduced to $1,780/month, until February of 2017, when his payments to the trustee were completed and the Bankruptcy discharged, again eight months prior to the issuance of the SOR. This allegation is found for Applicant.	For Applicant	Bankruptcy Filing	Admitted	—	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Applicant denies the existence of Federal and state tax liens totaling about $14,921. Both his Federal and state tax liens were discharged in February of 2016, eight months prior to the issuance of the SOR. This allegation is found for Applicant.

$14,921

For Applicant

Tax Unpaid

Denied

—

(g) arrangements made with the tax authority; in compliance

—

1.b

Applicant initially filed for the protection of a Chapter 13 bankruptcy in July of 2011. The original bankruptcy was dismissed in 2013, so that Applicant could refile for the protection of another Chapter 13 bankruptcy in November of that year. These allegations are found for Applicant.

For Applicant

Bankruptcy Filing

Admitted

—

(b) conditions largely beyond the person’s control; acted responsibly

(d) good-faith effort to repay or otherwise resolve debts

—

1.c

Applicant’s payments were thus reduced to $1,780/month, until February of 2017, when his payments to the trustee were completed and the Bankruptcy discharged, again eight months prior to the issuance of the SOR. This allegation is found for Applicant.

For Applicant

Bankruptcy Filing

Admitted

—

(b) conditions largely beyond the person’s control; acted responsibly

(d) good-faith effort to repay or otherwise resolve debts

—

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Case Profile

Summary

Why the Applicant Prevailed

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

ANALYSIS

WHOLE PERSON CONCEPT

FORMAL FINDINGS

CONCLUSION

FOOTNOTES