ISCR Case 09-04794.h1

Case Headnote

ISCR Case No. 09-04794.h1

grantedFeb 28, 2011· Hon. Arthur E. Marshall, Jr.· hearing

Summary

A 47-year-old production line employee was granted a security clearance despite concerns under Guideline F (Financial Considerations). The Statement of Reasons detailed several financial issues, including an unpaid debt of $4,281, a $162 medical judgment, and a $583 medical collection account. Additionally, the applicant had a state tax lien from 2006 with a balance of $4,825 as of November 5, 2010, and a second mortgage debt of $19,787 that became past due in mid-2009. Other debts included a $93 telecommunications balance and a $753 utility bill.

The applicant disputed some allegations, such as a $4,836 state tax lien from 2008, believing it referred to a previously paid 2004 debt, and a $26 medical collection account that the Government did not dispute was not hers. She also testified that the $162 medical judgment had been paid, though she lacked proof. Crucially, a federal tax lien for $5,901, dating from about 2005, was paid in full.

The judge found that the applicant had made significant progress in addressing her financial obligations, demonstrating a responsible repayment strategy and prioritizing tax debts. Her financial difficulties were largely attributed to external factors, including economic downturns and medical issues. Mitigating conditions AG ¶ 20(b) and AG ¶ 20(d) were applied, leading to the decision to grant the security clearance.

Why the Applicant Prevailed

The applicant demonstrated a clear strategy for addressing her debts, prioritizing tax obligations and making regular payments.
Significant progress was made in repaying debts, including the full satisfaction of a federal tax lien.
The applicant's financial difficulties were largely due to external factors, such as economic downturns and medical issues affecting her and her husband.

Conditions Referenced

Disqualifying

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

Mitigating

AG ¶ 20(b)appliedConditions That Resulted in the Behavior Were Largely Beyond the Person’s Control
AG ¶ 20(d)appliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve Debts

Key Rule Quoted

“The AG does not require that all one’s delinquent debts must be paid. It only requires that an applicant establish a reasonable plan to resolve the debts, and that the applicant has taken meaningful actions to implement the plan.”

Procedural Posture

SOR issuedMar 24, 2010
Answer filedApr 28, 2010Applicant admitted part of the allegations.
Hearing heldOct 28, 2010Hearing convened as scheduled.
Decision dateFeb 28, 2011

Cite For

Mitigation of Financial Considerations Under Guideline F
Importance of Demonstrating a Repayment Strategy
Impact of External Factors on Financial Obligations

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	Unpaid debt for $4,281 – Applicant is unsure of the origin of this disputed account. It is no longer reflected on Applicant’s credit report. $4,281	For Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—
1.b	Judgment for medical provider for $162 – Applicant testified that this debt was previously paid, but is unable to find evidence it has been paid. $162	For Applicant	Medical Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—
1.c	State tax lien from 2006 for $11,033 – Applicant has been in timely repayment on this debt for several years. The balance, as of November 5, 2010, was $4,825. $11,033	For Applicant	Tax Unpaid	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—
1.d	State tax lien from 2008 for $4,836 – Applicant denies this allegation. She believes this reference is to a 2004 tax debt that has since been paid. $4,836	For Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—
1.e	Collection account for medical services for $583 – Applicant acknowledges this debt for recent medical care, which she hopes to satisfy when her tax debts are paid. $583	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—
1.f	Mortgage debt for $19,787 – This debt is for a second mortgage. Applicant became past due on this account in mid-2009, not long before she started her present position and her household income was limited. $19,787	For Applicant	Mortgage or Home Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—
1.g	Telecommunications debt for $93 – This balance, owed on the former restaurant’s telephone service, remains unpaid. $93	For Applicant	Utility or Phone Debt	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—
1.h	Utility debt for $753 – This balance is for an electric bill. Applicant has made repayment arrangements on which payments are made, but the balance has yet to be satisfied. $753	For Applicant	Utility or Phone Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—
1.i	Federal tax lien for $5,901 – Now paid in full, Applicant was in repayment on this lien for past due joint income tax balances, dating from about 2005. $5,901	For Applicant	Tax Unpaid	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—
1.j	Medical collection account for $26 – Applicant cannot identify this debt and disputes the debt. The Government does not dispute Applicant’s assertion that this account is not hers. $26	For Applicant	Medical Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Unpaid debt for $4,281 – Applicant is unsure of the origin of this disputed account. It is no longer reflected on Applicant’s credit report.

$4,281

For Applicant

Unspecified Financial

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

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

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

—

1.b

Judgment for medical provider for $162 – Applicant testified that this debt was previously paid, but is unable to find evidence it has been paid.

$162

For Applicant

Medical Debt

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

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

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

—

1.c

State tax lien from 2006 for $11,033 – Applicant has been in timely repayment on this debt for several years. The balance, as of November 5, 2010, was $4,825.

$11,033

For Applicant

Tax Unpaid

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

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

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

—

1.d

State tax lien from 2008 for $4,836 – Applicant denies this allegation. She believes this reference is to a 2004 tax debt that has since been paid.

$4,836

For Applicant

Tax Unpaid

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

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

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

—

1.e

Collection account for medical services for $583 – Applicant acknowledges this debt for recent medical care, which she hopes to satisfy when her tax debts are paid.

$583

For Applicant

Medical Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

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

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

—

1.f

Mortgage debt for $19,787 – This debt is for a second mortgage. Applicant became past due on this account in mid-2009, not long before she started her present position and her household income was limited.

$19,787

For Applicant

Mortgage or Home Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

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

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

—

1.g

Telecommunications debt for $93 – This balance, owed on the former restaurant’s telephone service, remains unpaid.

$93

For Applicant

Utility or Phone Debt

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

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

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

—

1.h

Utility debt for $753 – This balance is for an electric bill. Applicant has made repayment arrangements on which payments are made, but the balance has yet to be satisfied.

$753

For Applicant

Utility or Phone Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

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

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

—

1.i

Federal tax lien for $5,901 – Now paid in full, Applicant was in repayment on this lien for past due joint income tax balances, dating from about 2005.

$5,901

For Applicant

Tax Unpaid

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

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

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

—

1.j

Medical collection account for $26 – Applicant cannot identify this debt and disputes the debt. The Government does not dispute Applicant’s assertion that this account is not hers.

$26

For Applicant

Medical Debt

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

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

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

—

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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

WHOLE PERSON CONCEPT

FORMAL FINDINGS

CONCLUSION

FOOTNOTES