ISCR Case 12-05082.h1

Case Headnote

ISCR Case No. 12-05082.h1

grantedJul 21, 2016· Hon. Richard A. Cefola· hearing

Summary

A 45-year-old applicant with an Associate’s Degree and three children was granted a security clearance despite initial concerns under Guideline F (Financial Considerations). The financial issues stemmed from a divorce and job loss, which were deemed circumstances largely beyond his control.

The Statement of Reasons detailed several financial allegations. The applicant denied indebtedness to Creditor A for approximately $15,450 and to Creditor E for about $224,379, both related to the short sale of his former house and the issuance of IRS Form 1099-C. These allegations were found for the applicant. He also denied indebtedness to Creditor B for a motor vehicle repossession debt ranging from about $20,994 to $25,200, which he disputed and subsequently settled for $3,000. This allegation was also found for the applicant.

The applicant admitted to an initial IRS debt of about $58,834 from two tax liens. Since February 2014, he has consistently made monthly payments of about $600, reducing the current balance to approximately $30,000. The judge found that the applicant had taken responsible steps to address his debts, including consistent payments to the IRS and settling other obligations. The applicant also received financial counseling, further mitigating the security concerns, leading to the decision to grant the security clearance.

Why the Applicant Prevailed

The applicant demonstrated that his financial difficulties were largely due to circumstances beyond his control, such as divorce and job loss.
He has made consistent payments to the IRS and settled other debts, showing responsible financial behavior.
The applicant received financial counseling, which contributed to mitigating the security concerns.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
AG ¶ 19(c)raisedHistory of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(b)appliedConditions Largely Beyond the Person's ControlThe applicant's financial issues were primarily due to divorce and job loss.
AG ¶ 20(c)appliedFinancial CounselingThe applicant received financial counseling to address his financial issues.

Key Rule Quoted

“The ultimate determination of whether to grant eligibility for a security clearance must be an overall commonsense judgment based upon careful consideration of the guidelines and the whole-person concept.”

Procedural Posture

SOR issuedJul 31, 2015
Answer filedAug 20, 2015
Hearing heldJan 29, 2016
Decision dateJul 21, 2016

Cite For

Mitigating Conditions Under Guideline F Related to Financial Difficulties Due to Circumstances Beyond Control
Importance of Financial Counseling in Mitigating Security Concerns
Whole-person Concept in Evaluating 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	Applicant denies that he is indebted to Creditor A for a past-due debt in the amount of about $15,450. His former house was sold by Creditor A at a short sale, resulting in an Internal Revenue Service (IRS) Form 1099-C being issued to Applicant. This allegation is found for Applicant. $15,450	For Applicant	Unspecified Financial	Denied	—	—	—
1.b	Applicant denies that he is indebted to Creditor B for a past-due debt, as the result of a repossession of a motor vehicle, in an amount ranging from about $20,994~$25,200. He disputed the amount owed, and has recently settled and paid this debt for $3,000. This allegation is found for Applicant. $25,000	For Applicant	Auto Loan Debt	Denied	—	—	—
1.c	Applicant admits that he was indebted to the IRS, as the result of two tax liens, in an amount initially totaling about $58,834. Since February of 2014, he has been making monthly payments of about $600 to the IRS as evidenced by documentation from the IRS and from Applicant’s bank. He presently owes about $30,000 to the IRS. These allegations are found for Applicant. $30,000	For Applicant	Tax Unpaid	Admitted	—	(b) conditions largely beyond the person’s control; acted responsibly	Documented Payment Plan with IRS
1.d	Applicant admits that he was indebted to the IRS, as the result of two tax liens, in an amount initially totaling about $58,834. Since February of 2014, he has been making monthly payments of about $600 to the IRS as evidenced by documentation from the IRS and from Applicant’s bank. He presently owes about $30,000 to the IRS. These allegations are found for Applicant. $30,000	For Applicant	Tax Unpaid	Admitted	—	(b) conditions largely beyond the person’s control; acted responsibly	Documented Payment Plan with IRS
1.e	Applicant denies that he is indebted to Creditor E for a past-due debt in the amount of about $224,379. This is also related to the short sale of his former house. Applicant received another IRS Form 1099-C as a result of this sale. This allegation is found for Applicant. $224,379	For Applicant	Unspecified Financial	Denied	—	—	—
1.f	Applicant denies that he is indebted to Creditor B for a past-due debt, as the result of a repossession of a motor vehicle, in an amount ranging from about $20,994~$25,200. He disputed the amount owed, and has recently settled and paid this debt for $3,000. This allegation is found for Applicant. $25,000	For Applicant	Auto Loan Debt	Denied	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Applicant denies that he is indebted to Creditor A for a past-due debt in the amount of about $15,450. His former house was sold by Creditor A at a short sale, resulting in an Internal Revenue Service (IRS) Form 1099-C being issued to Applicant. This allegation is found for Applicant.

$15,450

For Applicant

Unspecified Financial

Denied

—

1.b

Applicant denies that he is indebted to Creditor B for a past-due debt, as the result of a repossession of a motor vehicle, in an amount ranging from about $20,994~$25,200. He disputed the amount owed, and has recently settled and paid this debt for $3,000. This allegation is found for Applicant.

$25,000

For Applicant

Auto Loan Debt

Denied

—

1.c

Applicant admits that he was indebted to the IRS, as the result of two tax liens, in an amount initially totaling about $58,834. Since February of 2014, he has been making monthly payments of about $600 to the IRS as evidenced by documentation from the IRS and from Applicant’s bank. He presently owes about $30,000 to the IRS. These allegations are found for Applicant.

$30,000

For Applicant

Tax Unpaid

Admitted

—

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

Documented

Payment Plan with IRS

1.d

$30,000

For Applicant

Tax Unpaid

Admitted

—

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

Documented

Payment Plan with IRS

1.e

Applicant denies that he is indebted to Creditor E for a past-due debt in the amount of about $224,379. This is also related to the short sale of his former house. Applicant received another IRS Form 1099-C as a result of this sale. This allegation is found for Applicant.

$224,379

For Applicant

Unspecified Financial

Denied

—

1.f

$25,000

For Applicant

Auto Loan Debt

Denied

—

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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

FORMAL FINDINGS

CONCLUSION