ISCR Case 06-22225.h1

Case Headnote

ISCR Case No. 06-22225.h1

deniedAug 27, 2007· Hon. Thomas M. Crean· hearing

Summary

A 39-year-old retired soldier, employed by a defense contractor, was denied a security clearance under Guideline F (Financial Considerations) due to unresolved financial debts. The applicant admitted to six debts, but the decision focused on four that remained unpaid and for which he failed to demonstrate a good faith effort to resolve them.

Specifically, two medical debts from May and October 2001, incurred while the applicant was on active duty and covered by military healthcare, were sent to collections. Other outstanding debts included an $863 Capital One credit card debt, a $2,785 Military Star credit card debt, a Bank of America car loan, and an MBNA credit card debt. While the applicant stated intentions to settle or make arrangements for these, no evidence of good faith effort was provided.

Two debts were resolved: a Bank One car loan was paid with the lien released, and a mortgage, which became delinquent when the applicant's father failed to make payments, was brought current with an automatic payment plan established. Despite these resolutions and the applicant's explanations, the unaddressed debts and lack of demonstrated effort to resolve them led to the denial, concluding he posed a risk to national security.

Why the Applicant Was Denied

Applicant admitted six debts, including four that remained unpaid and unresolved.
He presented no evidence of a good faith effort to pay the four delinquent debts.
The applicant's financial troubles were not sufficiently mitigated by his explanations or circumstances.

Conditions Referenced

Disqualifying

FC DC ¶ 19(a)appliedInability or Unwillingness to Satisfy Debts
FC DC ¶ 19(c)appliedA History of Not Meeting Financial Obligations

Mitigating

FC MC ¶ 20(a)rejectedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to Recur and Does Not Cast Doubt on the Individual’s Current Reliability, Trustworthiness, or Good Judgement
FC MC ¶ 20(b)rejectedThe Conditions That Resulted in the Financial Problem Were Largely Beyond the Person’s Control
FC MC ¶ 20(d)rejectedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve Debts

Key Rule Quoted

“An intention to pay debts in the future is not sufficient to establish a good-faith effort to pay the debts.”

Procedural Posture

SOR issuedMar 23, 2007
Answer filedMay 24, 2007Applicant elected to have the matter decided on the written record.
Hearing held—No hearing; decided on the written record.
Decision dateAug 27, 2007

Cite For

Denial of Clearance Due to Unresolved Financial Obligations Under Guideline F
Insufficient Evidence of Good Faith Effort to Resolve Debts
Impact of Financial Irresponsibility on Security Clearance Eligibility

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	Delinquent debts 1 (SOR 1.a) and 2 (SOR 1.f) are medical debts to the local hospital that have been placed for collection. Applicant was on active duty with the Army when the debts were incurred in May and October 2001. As such, Applicant and his family were covered by the military health care system and the bills should have been paid by them.	For Applicant	Tax Filing Failure	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Delinquent debt 3 (SOR 1.b) is a credit card debt to Capital One for $863. Applicant thought he had paid the debt and stated he would settle it in the next 90 days. $863	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	Delinquent debt 4 (SOR 1.c) is for a Military Star credit card in the amount of $2,785. Applicant stated he made payment arrangements. $2,785	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	Delinquent debt 7 (SOR 1.d) is to Bank One on a car loan. This debt has been paid and the lien released.	For Applicant	Auto Loan Debt	Admitted	—	—	—
1.e	Delinquent debt 8 (SOR 1.e) is for the mortgage on Applicant’s residence. Applicant stated his father was living in the house and was supposed to make the house payment. On his return from an overseas assignment, he learned his father had not made the payments. The mortgage is current and Applicant established an automatic payment plan for the mortgage.	For Applicant	Mortgage or Home Loan Debt	Admitted	—	—	—
1.f	Delinquent debt 5 (SOR 1.g) is to Bank of America on a car loan. Applicant acknowledged the debt and stated he required time to clear the debt.	For Applicant	Auto Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	Delinquent debt 6 (SOR 1.h) is to MBNA bank on a credit card debt. Applicant acknowledged the debt and stated he would make payment arrangements.	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	specific text not stated in this decision	Against Applicant	Unspecified Financial	Unknown	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Delinquent debts 1 (SOR 1.a) and 2 (SOR 1.f) are medical debts to the local hospital that have been placed for collection. Applicant was on active duty with the Army when the debts were incurred in May and October 2001. As such, Applicant and his family were covered by the military health care system and the bills should have been paid by them.

For Applicant

Tax Filing Failure

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.b

Delinquent debt 3 (SOR 1.b) is a credit card debt to Capital One for $863. Applicant thought he had paid the debt and stated he would settle it in the next 90 days.

$863

Against Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.c

Delinquent debt 4 (SOR 1.c) is for a Military Star credit card in the amount of $2,785. Applicant stated he made payment arrangements.

$2,785

Against Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.d

Delinquent debt 7 (SOR 1.d) is to Bank One on a car loan. This debt has been paid and the lien released.

For Applicant

Auto Loan Debt

Admitted

—

1.e

Delinquent debt 8 (SOR 1.e) is for the mortgage on Applicant’s residence. Applicant stated his father was living in the house and was supposed to make the house payment. On his return from an overseas assignment, he learned his father had not made the payments. The mortgage is current and Applicant established an automatic payment plan for the mortgage.

For Applicant

Mortgage or Home Loan Debt

Admitted

—

1.f

Delinquent debt 5 (SOR 1.g) is to Bank of America on a car loan. Applicant acknowledged the debt and stated he required time to clear the debt.

For Applicant

Auto Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.g

Delinquent debt 6 (SOR 1.h) is to MBNA bank on a credit card debt. Applicant acknowledged the debt and stated he would make payment arrangements.

Against Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.h

specific text not stated in this decision

Against Applicant

Unspecified Financial

Unknown

—

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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

SYNOPSIS

APPEARANCES

STATEMENT OF CASE

FINDINGS OF FACT

POLICIES

CONCLUSION

FORMAL FINDINGS

DECISION

FOOTNOTES