Summary
The applicant, a 47-year-old claims processor for a defense contractor, faced trustworthiness concerns under Guideline F due to significant financial issues stemming from her husband's illness and death. Despite some efforts to address her debts, the applicant failed to provide sufficient evidence of financial stability or resolution of her delinquent accounts, leading to the denial of her eligibility for a public trust position.
Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: This is a bank credit card with a credit limit of $13,500 and a past-due and unpaid balance of $15,493 that was placed for collection and charged off. Applicant claimed that in February 2016 the creditor advised her that a Form 1099-C (Cancellation of Debt) would be furnished to her. As of the closing of the record, no such document had been submitted to me by Applicant. The account remains unresolved (1.a). This is a bank credit card with a credit limit of $6,000 and an unpaid balance of $7,610 that was placed for collection and charged off. Applicant claimed that in February 2016 the creditor advised her that a Form 1099-C would be furnished to her. As of the closing of the record, no such document had been submitted to me by Applicant. The account remains unresolved (1.b). This is a credit card with a credit limit of $5,000 and an unpaid balance of $5,875 that was placed for collection and charged off. A Form 1099-C was issued to her in January 2016. The account has been resolved (1.c). This is a department store charge account with a credit limit of $1,700, initial high credit of $2,253 and past-due balance of $699 that was placed for collection and sold to a debt purchaser. That debt purchaser increased the high credit to $2,254 and the past-due amount initially to $2,197, then to $2,661, and eventually to $2,778. Applicant acknowledged responsibility for the named account, but not the debt purchaser’s listing, and indicated that she was unable to commence payments until other accounts on her priority list were satisfied. The account remains unresolved (1.d). This is a department store charge account with a credit limit of $2,418, initial high credit of $2,163 and past-due balance of $860 that was placed for collection. The balance of $2,651 was charged off, and the account was sold to a debt purchaser. Applicant contacted the credit purchaser to set up a repayment plan. She made her initial $10 payment under that plan on February 3, 2016, and she intends to continue making monthly payments until the account is resolved. The account is in the process of being resolved (1.e). This is a bank charge account for a warehouse store with a balance of $1,697 that was placed for collection and sold to a debt purchaser. It was apparently transferred to a law firm. Applicant contacted both the debt purchaser as well as the law firm in an effort to set up a repayment plan, but, to date, her efforts have been unsuccessful. The account remains unresolved (1.f). This is an unspecified type of bank charge account with a credit limit of $5,000, high credit of $1,031, and past-due balance of $658 that was placed for collection. Applicant contacted the credit purchaser to set up a repayment plan. She made her initial $11 payment under that plan on February 3, 2016, and she intends to continue making monthly payments until the account is resolved. The account is in the process of being resolved (1.g). These are two hospital accounts with unpaid balances of $810 and $220 that were placed for collection with the same collection agency. Applicant contacted the collection agency to set up a repayment plan. The accounts were combined, and Applicant made her initial $25 payment under that plan on February 3, 2016. She intends to continue making monthly payments until the accounts are resolved. The accounts are in the process of being resolved (1.h). This is a clothing store charge account with a credit limit of $530 and unpaid balance of $617 that was placed for collection and charged off in December 2011. The account was either sold or otherwise assigned to another collection agent. Applicant acknowledged responsibility for the named account and indicated that she was unable to commence payments until other accounts on her priority list were satisfied. The account remains unresolved (1.i). This is a department store charge account with a credit limit of $500 and unpaid balance of $464 that was placed for collection and charged off in November 2011. The account was either sold or otherwise assigned to an unidentified collection agent. Applicant acknowledged responsibility for the named account and indicated that she was unable to commence payments until other accounts on her priority list were satisfied. The account remains unresolved (1.j). This is a credit card account with a credit limit of $300 and unpaid balance of $403 that was placed for collection and sold to a debt purchaser. Applicant contacted the credit purchaser to set up a repayment plan. She made her initial $134.46 payment under that plan on February 3, 2016, and she intends to continue making monthly payments until the account is resolved. The account is in the process of being resolved (1.k). This is a home improvement store credit card account with a credit limit of $500 and unpaid balance of $322 that was placed for collection and charged off in October 2011. The account was subsequently sold to a debt purchaser who now reports the unpaid balance as $323. Applicant contacted the credit purchaser to set up a repayment plan. She made her initial $12.53 payment under that plan on February 3, 2016, and she intends to continue making monthly payments until the account is resolved. The account is in the process of being resolved (1.l). These are two medical accounts (one is for an anesthesiologist and the other is unspecified) with unpaid balances of $244 and $110 that were placed for collection. The collection agency for only one of the accounts has been identified. Applicant contended that she contacted the collection agency to set up a repayment plan for all of her medical accounts, and that the accounts were combined, and she made made her initial $25 payment under that plan on February 3, 2016. There is no documentation to support her contention that all of the medical accounts were combined. Under the circumstances, it is impossible to conclude that these two accounts were included in her repayment plan. The resolution status of these two accounts is unclear (1.m). This is a judgment in the amount of $1,387 obtained by a debt purchaser in March 2013 for an unspecified type of account. The plaintiff who obtained the judgment is the same debt purchaser revealed in SOR ¶¶ 1.d. and 1.q. above, and its name does not appear in any of the credit reports discussed above with the exception of these entries. Applicant claimed to have no knowledge of the judgment, and she has not contacted the listed plaintiff to learn more about the judgment or the identity of the original creditor. There is no evidence that she ever attempted to contest the matter with the court in which the judgment was obtained. The account remains unresolved (1.o). This is an unspecified type of account with an unpaid and past-due balance of $1,747 that was placed for collection and sold to the listed debt purchaser. The account does not appear in Applicant’s 2014, 2015, or 2016 credit reports. Applicant claims she disputed the account, but acknowledged that she had not yet attempted to contact the listed collection agent/debt purchaser. She failed to submit any documentation to support the existence of a dispute. The account remains unresolved (1.r). This is a department store charge account with a credit limit of $250 and unpaid balance of $468 that was placed for collection and charged off. The account was sold to a debt purchaser. Applicant initially acknowledged responsibility for the named account, but subsequently denied such responsibility because the account was no longer in her most recent credit report. The account remains unresolved (1.t). Withdrawn - For Applicant (1.w). This is a medical account with unpaid balance of $84 that was placed for collection. Applicant indicated that the entire balance would be paid the day after the hearing which was also her pay day. Although she was offered the opportunity to do so, she failed to submit any documentation to support the existence of any such payment. The account remains unresolved (1.y).
The judge denied the clearance. The government raised disqualifying conditions F.3, F.2. The decision turned on the following: The applicant admitted to multiple delinquent accounts totaling approximately $50,391; She failed to provide documentation supporting her claims of debt resolution or financial counseling; The applicant did not demonstrate a proactive approach to managing her financial issues, as evidenced by her lack of a budget and failure to follow up on opportunities to supplement the record.
Why the Applicant Was Denied
- The applicant admitted to multiple delinquent accounts totaling approximately $50,391.
- She failed to provide documentation supporting her claims of debt resolution or financial counseling.
- The applicant did not demonstrate a proactive approach to managing her financial issues, as evidenced by her lack of a budget and failure to follow up on opportunities to supplement the record.
Conditions Referenced
- F.3raisedInability or Unwillingness to Satisfy Debts
- F.2raisedA History of Not Meeting Financial Obligations
Key Rule Quoted
“The standard that must be met for . . . assignment to sensitive duties is that, based on all available information, the person’s loyalty, reliability, and trustworthiness are such that . . . assigning the person to sensitive duties is clearly consistent with the interests of national security.”
Procedural Posture
- SOR issuedAug 1, 2015
- Answer filedSep 1, 2015
- Hearing heldFeb 4, 2016
- Decision dateAug 5, 2016
Cite For
- Failure to Mitigate Financial Considerations Under Guideline F
- Impact of Unresolved Debts on Trustworthiness Determinations
- Importance of Providing Evidence of Financial Stability in Clearance Cases