Summary
A 49-year-old defense contractor was denied a security clearance under Guideline F (Financial Considerations) due to a history of multiple bankruptcies and delinquent debts. The Statement of Reasons detailed several financial issues, including a Chapter 13 bankruptcy petition filed in April 2014, which was dismissed in July 2015 after the applicant failed to make required payments.
Another Chapter 13 petition was filed in January 2016, listing unpaid federal income taxes totaling $28,145 for tax years 2010-2013 and $10,717 for tax years 2006-2009, partly due to an early retirement account withdrawal. The applicant refiled a Chapter 13 petition in May 2017, listing priority unsecured claims of $6,421 and nonpriority unsecured claims totaling $127,287.
Despite the application of several mitigating conditions, the judge found that the applicant's financial issues were recent and numerous, raising concerns about reliability and trustworthiness. The applicant's history included two Chapter 7 and two Chapter 13 filings, and a failure to demonstrate compliance with any bankruptcy payment plans, ultimately leading to the denial of the security clearance.
Why the Applicant Was Denied
- The applicant has a history of multiple bankruptcies, including two Chapter 7 and two Chapter 13 filings, indicating an inability to manage financial obligations.
- The applicant's financial issues are recent and numerous, raising doubts about his reliability and trustworthiness.
- The applicant failed to demonstrate compliance with any bankruptcy payment plans, undermining claims of financial stability.
Conditions Referenced
- AG ¶ 19(a)appliedInability to Satisfy Debts
- AG ¶ 19(b)appliedUnwillingness to Satisfy Debts Regardless of the Ability to Do So
- AG ¶ 19(c)appliedA History of Not Meeting Financial Obligations
- AG ¶ 19(f)appliedFailure 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(a)rejectedBehavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to Recur
- AG ¶ 20(b)notedConditions That Resulted in the Financial Problem Were Largely Beyond the Person's Control
- AG ¶ 20(c)rejectedReceived or Is Receiving Financial Counseling
- AG ¶ 20(d)rejectedInitiated and Is Adhering to a Good-faith Effort to Repay Overdue Creditors
- AG ¶ 20(e)appliedReasonable Basis to Dispute the Legitimacy of the Past-due Debt
- AG ¶ 20(g)rejectedArrangements with the Appropriate Tax Authority to File or Pay the Amount Owed
Key Rule Quoted
“Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the adjudicative guidelines.”
Procedural Posture
- SOR issuedJun 15, 2017
- Answer filedJul 7, 2017
- Hearing heldDec 7, 2017
- Decision dateMar 14, 2018
Cite For
- Denial Based on Recent and Unresolved Financial Issues Under Guideline F
- Impact of Multiple Bankruptcies on Security Clearance Eligibility
- Evaluation of Financial Responsibility in Security Clearance Determinations