Summary
A 51-year-old field service engineer was denied a security clearance under Guideline F (Financial Considerations) due to significant delinquent debt and a failure to file federal income taxes for several years. The applicant had incurred substantial delinquent debt over the past five years, including a mortgage loan on a former residence that went into foreclosure after an unsuccessful attempt to convert it into a rental property. This mortgage was fully repaid in November 2012.
While some debts were resolved, others remained problematic. The applicant made a final payment in March 2015 to settle one delinquent debt for a negotiated lesser amount, and another student loan debt was resolved in August 2015 for $690. Additionally, a $1,224 student loan debt was subject to salary garnishment. Two delinquencies to a major bank, representing the same account, were fully repaid. However, a $2,853 credit card balance from May 2009, which had grown to $4,006 by the time of the hearing, remained unresolved, with a collection agency having obtained a judgment in May 2013.
The denial was based on the applicant's significant delinquent debt, which included over $33,000 on his home mortgage, and his failure to file federal income tax returns for tax years 2010 through 2013. The decision concluded that the applicant's financial situation remained untenable, creating potential for pressure and duress.
Why the Applicant Was Denied
- Applicant incurred significant delinquent debt exceeding $33,000 on his home mortgage.
- Applicant failed to file federal income tax returns for tax years 2010 to 2013, raising concerns about financial responsibility.
- The applicant's financial situation remains untenable, creating potential for pressure and duress.
Conditions Referenced
- F.19(a)raisedInability or Unwillingness to Satisfy Debts
- F.19(c)raisedA History of Not Meeting Financial Obligations
- F.19(g)raisedFailure to File Annual Federal, State, or Local Income Tax Returns as Required
- F.20(a)rejectedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to RecurApplicant's financial irresponsibility spans many years.
- F.20(b)rejectedThe Conditions That Resulted in the Financial Problem Were Largely Beyond the Person’s ControlApplicant voluntarily incurred the debt and chose not to file required income tax returns.
- F.20(c)rejectedThe Person Has Received or Is Receiving Counseling for the ProblemInsufficient evidence of effective credit counseling or budget planning.
- F.20(d)rejectedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsWhile some debts were resolved, significant mortgage delinquency remained.
- F.20(e)notedThe Individual Has a Reasonable Basis to Dispute the Legitimacy of the Past-due Debt
Key Rule Quoted
“The protection of the national security is the paramount consideration.”
Procedural Posture
- SOR issuedFeb 27, 2017
- Answer filedMar 5, 2015
- Hearing heldAug 12, 2015
- Decision dateMar 10, 2016Remanded on 05/17/2016.
Cite For
- Denial of Security Clearance Due to Significant Financial Issues Under Guideline F
- Failure to File Federal Income Taxes as a Disqualifying Factor
- Ongoing Financial Irresponsibility Impacting Security Clearance Eligibility