ISCR Case 17-00378.h1

Case Headnote

ISCR Case No. 17-00378.h1

deniedJul 17, 2018· Hon. Marc E. Curry· hearing

Summary

A 52-year-old single man was denied a security clearance due to concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The denial stemmed from a lengthy history of financial difficulties and a failure to meet financial obligations, despite some favorable findings regarding his personal conduct.

The applicant's Statement of Reasons detailed several issues. He was alleged to have falsified his February 2013 security clearance application by denying a failure to file or pay income taxes within seven years. He also allegedly falsified a January 2016 bankruptcy petition by denying a previous bankruptcy filing within eight years. Further, he did not timely file federal income tax returns from 2012 to 2014, nor state income tax returns for 2013 and 2014, owing $2,200 in delinquent state taxes as of March 2017. His financial history included multiple bankruptcy filings: a withdrawn Chapter 13 petition in August 2009, a dismissed Chapter 7 case in May 2010, and a dismissed Chapter 13 petition in July 2014. By 2014, his mortgage payments were over $120,000 past due, and he owed $513 to a credit card company, $244 to another creditor, and $1,952 in delinquent child support.

The denial was based on the applicant's extensive history of failing to pay debts, including mortgage and taxes. He did not provide evidence of making payments towards these debts, which undermined his claims of financial responsibility. The ongoing and severe nature of his financial problems raised concerns about his reliability and trustworthiness.

Why the Applicant Was Denied

The applicant has a lengthy history of failure to pay debts, including mortgage and taxes.
The applicant failed to provide evidence of making payments towards his debts, undermining claims of financial responsibility.
The applicant's financial problems are ongoing and severe, raising concerns about reliability and trustworthiness.

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 Pay Annual Federal, State, or Local Income Tax Returns as Required

Mitigating

AG ¶ 20(b)appliedConditions That Resulted in the Financial Problem Were Largely Beyond the Person’s Control

Key Rule Quoted

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

Procedural Posture

SOR issuedMar 29, 2017
Answer filedApr 18, 2017
Hearing heldMar 7, 2018
Decision dateJul 17, 2018

Cite For

Denial Based on Unresolved Financial Obligations Under Guideline F
Consideration of Personal Conduct in the Context of Financial Issues
Importance of Providing Evidence for Claims of Debt Repayment

Editorial summary generated for research. Not legal advice; not a prediction. Verify against the full decision before relying on any quoted language.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a	Applicant falsified his security clearance application, completed in February 2013, when he answered “no” to the question asking whether he had either failed to file or pay his income taxes within seven years before completing the application.	For Applicant	Omission or Failure to Disclose	—	Denied	—	—	—
2.b	Applicant falsified the bankruptcy petition completed in January 2016 when he answered “no” in response to the question of whether he had filed a bankruptcy petition in the previous eight years.	For Applicant	Omission or Failure to Disclose	—	Denied	—	—	—

Allegation

Finding

Conduct

Concealed Issue

Response

Disqualifying (¶16)

Mitigating applied (¶17)

Mitigation

2.a

Applicant falsified his security clearance application, completed in February 2013, when he answered “no” to the question asking whether he had either failed to file or pay his income taxes within seven years before completing the application.

For Applicant

Omission or Failure to Disclose

—

Denied

—

2.b

Applicant falsified the bankruptcy petition completed in January 2016 when he answered “no” in response to the question of whether he had filed a bankruptcy petition in the previous eight years.

For Applicant

Omission or Failure to Disclose

—

Denied

—

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Applicant did not file his federal income tax returns timely from tax years 2012 to 2014.	Against Applicant	Tax Filing Failure	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations (f) failure to file / fraudulent filing of tax returns or unpaid tax	—	—
1.b	Applicant did not file his state income tax returns timely for tax years 2013 and 2014.	Against Applicant	Tax Filing Failure	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations (f) failure to file / fraudulent filing of tax returns or unpaid tax	—	—
1.c	specific text not stated in this decision	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.d	Applicant owed $2,200 in delinquent state income taxes for tax years 2013 and 2014, as of March 2017. $2,200	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	specific text not stated in this decision	Against Applicant	Unspecified Financial	Unknown	—	—	—
1.f	Applicant filed Chapter 13 bankruptcy protection in August 2009, later withdrew the petition.	Against Applicant	Bankruptcy Filing	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	In May 2010, Applicant filed for Chapter 7 bankruptcy protection, the court dismissed the case after Applicant failed to make the required filings.	Against Applicant	Bankruptcy Filing	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	In July 2014, he filed for Chapter 13 bankruptcy protection, the petition was dismissed in August 2014.	Against Applicant	Bankruptcy Filing	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i–1.j	2 sub-charges — specific text not stated in this decision (against the applicant). (low confidence)	Against Applicant			—	—	—
1.k	By 2014, Applicant’s mortgage payments were more than $120,000 past due. $120,000	Against Applicant	Mortgage or Home Loan Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.l	Applicant owes $513 to a credit card company. $513	Against Applicant	Credit Card Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.m	Applicant owes $244 to a creditor. $244	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.n	Applicant owes $1,952 in delinquent child support payments. $1,952	For Applicant	Unspecified Financial	Denied	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Applicant did not file his federal income tax returns timely from tax years 2012 to 2014.

Against Applicant

Tax Filing Failure

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(f) failure to file / fraudulent filing of tax returns or unpaid tax

—

1.b

Applicant did not file his state income tax returns timely for tax years 2013 and 2014.

Against Applicant

Tax Filing Failure

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(f) failure to file / fraudulent filing of tax returns or unpaid tax

—

1.c

specific text not stated in this decision

Against Applicant

Unspecified Financial

Unknown

—

1.d

Applicant owed $2,200 in delinquent state income taxes for tax years 2013 and 2014, as of March 2017.

$2,200

Against Applicant

Tax Unpaid

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.e

specific text not stated in this decision

Against Applicant

Unspecified Financial

Unknown

—

1.f

Applicant filed Chapter 13 bankruptcy protection in August 2009, later withdrew the petition.

Against Applicant

Bankruptcy Filing

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.g

In May 2010, Applicant filed for Chapter 7 bankruptcy protection, the court dismissed the case after Applicant failed to make the required filings.

Against Applicant

Bankruptcy Filing

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.h

In July 2014, he filed for Chapter 13 bankruptcy protection, the petition was dismissed in August 2014.

Against Applicant

Bankruptcy Filing

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.i–1.j

2 sub-charges — specific text not stated in this decision (against the applicant). (low confidence)

Against Applicant

—

1.k

By 2014, Applicant’s mortgage payments were more than $120,000 past due.

$120,000

Against Applicant

Mortgage or Home Loan Debt

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.l

Applicant owes $513 to a credit card company.

$513

Against Applicant

Credit Card Debt

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.m

Applicant owes $244 to a creditor.

$244

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.n

Applicant owes $1,952 in delinquent child support payments.

$1,952

For Applicant

Unspecified Financial

Denied

—

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Case Profile

Summary

Why the Applicant Was Denied

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