ISCR Case 15-00313.h1

Case Headnote

ISCR Case No. 15-00313.h1

deniedAug 11, 2017· Hon. Braden M. Murphy· hearing

Summary

A 49-year-old defense contractor was denied a security clearance under Guideline F (Financial Considerations) due to significant unresolved financial delinquencies totaling approximately $27,000. These debts primarily stemmed from student loans and various consumer debts.

Specific allegations included two student loan accounts from Sallie Mae, totaling $14,182 each, which had accrued to $14,628 per account by June 2015. Other unresolved consumer debts included two accounts for $1,593 and $1,283, respectively, and two home-shopping television channel debts for $545 and $523. A judgment for $1,117, for which the applicant made seven $30 payments between November 2012 and October 2013, also remained unresolved. Additionally, a $113 auto insurance collection debt and a $7,000 credit card judgment, later settled for $4,000 with an agreement for $50 monthly payments, were outstanding. One consumer debt of $975 was paid in April 2015 after a court summons.

Despite acknowledging some debts and indicating intentions to pay, the applicant failed to provide sufficient updated documentation or evidence of responsible financial management. The significant and unresolved nature of these delinquencies, coupled with a lack of demonstrated good-faith effort to repay creditors, led to the denial of the security clearance.

Why the Applicant Was Denied

The applicant did not provide updated documentation or evidence of responsible financial management.
The applicant's financial delinquencies were significant and unresolved, raising concerns about his reliability and trustworthiness.
The applicant failed to demonstrate a good-faith effort to repay overdue creditors or resolve debts.

Conditions Referenced

Disqualifying

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

Mitigating

AG ¶ 20(b)rejectedConditions Largely Beyond ControlWhile unemployment was a circumstance beyond his control, the applicant did not provide evidence of responsible actions taken to address his financial issues.
AG ¶ 20(c)rejectedFinancial CounselingThe applicant indicated he was taking debt management classes but provided no details or evidence of their legitimacy.
AG ¶ 20(d)rejectedGood-faith Effort to Repay DebtsThe applicant did not establish a track record of payments or evidence of financial stability.

Key Rule Quoted

“An applicant is not required to be debt-free nor to develop a plan for paying off all debts immediately or simultaneously. All that is required is that an applicant act responsibly given his circumstances and develop a reasonable plan for repayment, accompanied by ‘concomitant conduct,’ that is, actions which evidence a serious intent to effectuate the plan.”
— ISCR Case No. 07-06842 at 3 (App. Bd. May 21, 2008)

Procedural Posture

SOR issuedJul 5, 2015
Answer filedAug 6, 2015Applicant elected to have the case decided on the written record.
Hearing held—No hearing; decision based on written record.
Decision dateAug 11, 2017

Cite For

Insufficient Evidence of Financial Responsibility Under Guideline F
Impact of Unresolved Debts on Security Clearance Eligibility
Criteria for Evaluating Financial Considerations in Security Clearance Cases

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	SOR ¶ 1.a are student loans, totaling $14,182. Applicant took out the loans with Sallie Mae between 2006 and 2008, to pay for his education. Applicant provided documents from the collection agency showing that as of June 2015 he owed $14,628 on the two accounts. $14,628	Against Applicant	Student Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	SOR ¶ 1.b are student loans, totaling $14,182. Applicant took out the loans with Sallie Mae between 2006 and 2008, to pay for his education. Applicant provided documents from the collection agency showing that as of June 2015 he owed $14,628 on the two accounts. $14,628	Against Applicant	Student Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	SOR ¶ 1.c ($1,593) and 1.d ($1,283) are consumer debts placed for collection. Applicant indicated in his answer that he planned to pay off the accounts in two years. He provided no updated documentation in response to the FORM. These accounts remain unresolved. $1,593	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	SOR ¶ 1.c ($1,593) and 1.d ($1,283) are consumer debts placed for collection. Applicant indicated in his answer that he planned to pay off the accounts in two years. He provided no updated documentation in response to the FORM. These accounts remain unresolved. $1,283	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	SOR ¶ 1.e is a consumer debt in collection for $975. Applicant paid the account in April 2015, after he received a court summons about it. $975	For Applicant	Unspecified Financial	Admitted	—	—	—
1.f	SOR ¶ 1.f ($545) and 1.h ($523) are consumer debts in collection to two home-shopping television channels. Applicant indicated that he would pay off the accounts off in a year. He provided no updated documentation in response to the FORM. The accounts remain unresolved. $545	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	SOR ¶ 1.g is a judgment for $1,117. Applicant admitted the debt, but contested the amount owed. In answering the judgment, he admitted owing the creditor. Judgment was entered in the amount alleged. In 2012, he was ordered to pay $30 a month towards the judgment. He provided proof that he made seven $30 payments between November 2012 and October 2013 but no subsequent payments are indicated. This debt is unresolved. $1,117	Against Applicant	Judgment Against Applicant	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	SOR ¶ 1.f ($545) and 1.h ($523) are consumer debts in collection to two home-shopping television channels. Applicant indicated that he would pay off the accounts off in a year. He provided no updated documentation in response to the FORM. The accounts remain unresolved. $523	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	SOR ¶ 1.i is a $113 collection debt for auto insurance. Applicant admitted the debt but indicated that he had not had auto insurance with this company for 10 years. He was not aware of the debt but indicated he would research it. He provided no updated documentation in response to the FORM. The account remains unresolved. $113	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.j	SOR ¶ 1.j is a $7,000 judgment to a credit card company. The judgment was issued in 2004 and is not listed on the credit reports provided by the Government. Applicant denied that he owed the amount alleged but provided documents about the debt. The creditor agreed to settle the debt for $4,000 in April 2015. Applicant was to make monthly payments of $166 for 24 months. He made $200 payments in May and June 2015. He also provided court documents indicating that in May 2015 the creditor sought unsuccessfully to attach his wages to recover the debt. Applicant agreed to pay $50 a month, and the motion to attach his wages was denied. He provided no updated documentation in response to the FORM. The account remains unresolved. $7,000	Against Applicant	Judgment Against Applicant	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

SOR ¶ 1.a are student loans, totaling $14,182. Applicant took out the loans with Sallie Mae between 2006 and 2008, to pay for his education. Applicant provided documents from the collection agency showing that as of June 2015 he owed $14,628 on the two accounts.

$14,628

Against Applicant

Student Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.b

SOR ¶ 1.b are student loans, totaling $14,182. Applicant took out the loans with Sallie Mae between 2006 and 2008, to pay for his education. Applicant provided documents from the collection agency showing that as of June 2015 he owed $14,628 on the two accounts.

$14,628

Against Applicant

Student Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.c

SOR ¶ 1.c ($1,593) and 1.d ($1,283) are consumer debts placed for collection. Applicant indicated in his answer that he planned to pay off the accounts in two years. He provided no updated documentation in response to the FORM. These accounts remain unresolved.

$1,593

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.d

$1,283

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.e

SOR ¶ 1.e is a consumer debt in collection for $975. Applicant paid the account in April 2015, after he received a court summons about it.

$975

For Applicant

Unspecified Financial

Admitted

—

1.f

SOR ¶ 1.f ($545) and 1.h ($523) are consumer debts in collection to two home-shopping television channels. Applicant indicated that he would pay off the accounts off in a year. He provided no updated documentation in response to the FORM. The accounts remain unresolved.

$545

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.g

SOR ¶ 1.g is a judgment for $1,117. Applicant admitted the debt, but contested the amount owed. In answering the judgment, he admitted owing the creditor. Judgment was entered in the amount alleged. In 2012, he was ordered to pay $30 a month towards the judgment. He provided proof that he made seven $30 payments between November 2012 and October 2013 but no subsequent payments are indicated. This debt is unresolved.

$1,117

Against Applicant

Judgment Against Applicant

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.h

$523

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.i

SOR ¶ 1.i is a $113 collection debt for auto insurance. Applicant admitted the debt but indicated that he had not had auto insurance with this company for 10 years. He was not aware of the debt but indicated he would research it. He provided no updated documentation in response to the FORM. The account remains unresolved.

$113

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.j

SOR ¶ 1.j is a $7,000 judgment to a credit card company. The judgment was issued in 2004 and is not listed on the credit reports provided by the Government. Applicant denied that he owed the amount alleged but provided documents about the debt. The creditor agreed to settle the debt for $4,000 in April 2015. Applicant was to make monthly payments of $166 for 24 months. He made $200 payments in May and June 2015. He also provided court documents indicating that in May 2015 the creditor sought unsuccessfully to attach his wages to recover the debt. Applicant agreed to pay $50 a month, and the motion to attach his wages was denied. He provided no updated documentation in response to the FORM. The account remains unresolved.

$7,000

Against Applicant

Judgment Against Applicant

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

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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

APPEARANCES

STATEMENT OF CASE

FINDINGS OF FACT

POLICIES

ANALYSIS

WHOLE PERSON CONCEPT

FORMAL FINDINGS

CONCLUSION

FOOTNOTES