ISCR Case 06-14949.h1

Case Headnote

ISCR Case No. 06-14949.h1

grantedOct 3, 2007· Hon. Shari Dam· hearing

Summary

A 35-year-old linguist, employed with the U.S. Armed Forces for several years, was granted a security clearance despite concerns under Guideline F (Financial Considerations). The applicant accumulated debts during a period of unemployment following an automobile accident.

Specific allegations included a disputed furniture debt of approximately $700, which the applicant attempted to settle after returning to work in early 2002. This debt was later disputed through a credit reporting agency in April 2005 and is now considered resolved by his credit counselor. An automobile loan debt, which grew from $15,439 in 2001 to $32,000 by September 2007, was also disputed. The applicant had requested repossession of the vehicle during unemployment, having paid about $4,000 on the original $22,000 loan. This matter was disputed in April 2005 with credit counselor assistance and no longer appears on his credit report. Additionally, a $408 telephone bill was paid on January 1, 2006, and a $110 cell phone bill was paid on November 5, 2005.

The judge found that the applicant mitigated the security concerns. This was based on his responsible actions, including seeking credit counseling, making efforts to resolve his debts, and having no outstanding balances on his latest credit report. The financial issues were largely attributed to circumstances beyond his control during a significant period of unemployment.

Why the Applicant Prevailed

The applicant demonstrated responsible behavior by seeking credit counseling after experiencing financial difficulties due to unemployment.
He has made efforts to resolve his debts and has no outstanding balances according to his latest credit report.
The applicant's financial issues were largely beyond his control, arising during a significant period of unemployment.

Conditions Referenced

Disqualifying

FC DC 19(a)raisedInability or Unwillingness to Satisfy Debts
FC DC 19(c)raisedA History of Not Meeting Financial Obligations

Mitigating

FC MC 20(b)appliedConditions That Resulted in the Financial Problem Were Largely Beyond the Person's Control
FC MC 20(c)appliedReceived Counseling for the Problem And/or Indications That the Problem Is Being Resolved
FC MC 20(d)appliedInitiated a Good-faith Effort to Repay Overdue Creditors or Resolve Debts
FC MC 20(e)appliedReasonable Basis to Dispute the Legitimacy of the Past-due Debt

Key Rule Quoted

“Failure or inability to live within one’s means, satisfy debts, and meet financial obligations may indicate poor self-control, lack of judgment, or unwillingness to abide by rules and regulations, all of which can raise questions about an individual’s reliability, trustworthiness and ability to protect classified information.”
— Guideline ¶ 18

Procedural Posture

SOR issuedApr 23, 2007
Answer filedMay 18, 2006
Hearing heldSep 11, 2007
Decision dateOct 3, 2007

Cite For

Mitigation of Financial Issues Due to Unemployment Under Guideline F
Importance of Credit Counseling in Resolving Financial Concerns
Consideration of the Whole Person Concept in Security Clearance Decisions

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 acknowledged the underlying debt for furniture, but denied owing $1,196. After he returned to work in February or March of 2002, he attempted to negotiate a settlement for the balance owed of about $700, but was unsuccessful because the company insisted that he pay all of the interest charges. In April 2005, he disputed the matter through a credit reporting agency. According to his credit counselor, the debt is resolved.	For Applicant	Unspecified Financial	Admitted	—	(b) conditions largely beyond the person’s control; acted responsibly (c) received/receiving counseling; problem being resolved (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.c	Applicant admitted that he owed money to this creditor, an automobile loan company, but disputed the amount. When he realized that he could not manage this debt during his unemployment, he requested the creditor repossess the vehicle by which time he had paid approximately $4,000 on a $22,000 loan. The loan company sold the car for $11,000, but insisted that Applicant repay the entire loan without crediting him for his payments or the proceeds of the sale of the car. In April 2005, he disputed the debt with the assistance of his credit counselor. According to recent information, in 2001 the amount owed was $15,439, the amount was $23,128 when the SOR was filed, and was $32,0000 as of September 19, 2007. The credit counselor considers the matter resolved from a credit standpoint. It does not appear on the August 29, 2007 credit report. $32,000	For Applicant	Auto Loan Debt	Admitted	—	(b) conditions largely beyond the person’s control; acted responsibly (c) received/receiving counseling; problem being resolved (d) good-faith effort to repay or otherwise resolve debts	Claimed Other
1.d	Applicant paid the $408 telephone bill on January 1, 2006. $408	For Applicant	Utility or Phone Debt	Admitted	—	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.e	Applicant paid the cell phone bill for $110 on November 5, 2005. $110	For Applicant	Utility or Phone Debt	Admitted	—	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Applicant acknowledged the underlying debt for furniture, but denied owing $1,196. After he returned to work in February or March of 2002, he attempted to negotiate a settlement for the balance owed of about $700, but was unsuccessful because the company insisted that he pay all of the interest charges. In April 2005, he disputed the matter through a credit reporting agency. According to his credit counselor, the debt is resolved.

For Applicant

Unspecified Financial

Admitted

—

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

(c) received/receiving counseling; problem being resolved

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

Claimed

Other

1.c

Applicant admitted that he owed money to this creditor, an automobile loan company, but disputed the amount. When he realized that he could not manage this debt during his unemployment, he requested the creditor repossess the vehicle by which time he had paid approximately $4,000 on a $22,000 loan. The loan company sold the car for $11,000, but insisted that Applicant repay the entire loan without crediting him for his payments or the proceeds of the sale of the car. In April 2005, he disputed the debt with the assistance of his credit counselor. According to recent information, in 2001 the amount owed was $15,439, the amount was $23,128 when the SOR was filed, and was $32,0000 as of September 19, 2007. The credit counselor considers the matter resolved from a credit standpoint. It does not appear on the August 29, 2007 credit report.

$32,000

For Applicant

Auto Loan Debt

Admitted

—

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

(c) received/receiving counseling; problem being resolved

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

Claimed

Other

1.d

Applicant paid the $408 telephone bill on January 1, 2006.

$408

For Applicant

Utility or Phone Debt

Admitted

—

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

Documented

Debt Paid in Full

1.e

Applicant paid the cell phone bill for $110 on November 5, 2005.

$110

For Applicant

Utility or Phone Debt

Admitted

—

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

Documented

Debt Paid in Full

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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

SYNOPSIS

APPEARANCES

STATEMENT OF CASE

PROCEDURAL MATTERS

FINDINGS OF FACT

POLICIES

CONCLUSION

WHOLE PERSON ANALYSIS

FORMAL FINDINGS

DECISION

FOOTNOTES