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Summary

The applicant, a 34-year-old employee of a defense contractor, sought eligibility for a public trust position under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The applicant faced trustworthiness concerns due to financial delinquencies and inaccuracies in her e-QIP responses. However, she demonstrated significant efforts to resolve her debts and provided character references supporting her trustworthiness. The judge granted her eligibility, finding that she mitigated the concerns raised.

Under Guideline E (Personal Conduct) and Guideline F (Financial Considerations), the Statement of Reasons alleged the following: This is a bank loan used to pay off other debts with a high credit of $7,580 and an unpaid balance of $9,072 that was placed for collection in 2010 and sold to a debt purchaser. The account was originally set to be included in her proposed debt consolidation, but nothing initially took place until recently because it was in a lower tier of her list of priorities. She apparently contacted the debt purchaser, and she agreed to a repayment plan under which she has been making monthly payments of $50. The account is in the process of being resolved (1.a). This is a bank credit card (with an initial credit of $200, which was eventually increased to $7,500) with high credit of $7,746 that was placed for collection and charged off. The creditor apparently issued a Form 1099-C, Cancellation of Debt, and the charged-off amount was reported to the Internal Revenue Service (IRS) as income. Her anticipated refund was applied by the IRS to her additional income tax liability, and she recently agreed to make monthly payments of $25 to the creditor to cover any unpaid balance. The account has either been resolved or is in the process of being resolved (1.b). This is a bank credit card with a credit limit of $5,000 and unpaid and past-due balance of approximately $7,037 that was placed for collection and sold to a debt purchaser. Applicant contacted the debt purchaser, and on August 24, 2015, she agreed to a repayment plan under which she has been making monthly payments of $50. The account is in the process of being resolved (1.c). This is an automobile loan on a car purchased by Applicant’s former fiancé (using her credit because of his bad credit). Routine monthly payments were made for about one year until he stopped making them and their relationship dissolved. The account was placed for collection. The vehicle was repossessed, and $12,817 was charged off, leaving an unpaid balance of $6,665. Applicant’s former fiancé has continued to fail to make promised payments, and Applicant requested repayment terms from the collection agent consistent with her ability to pay. While the account remains in Applicant’s second group of priorities, she recently agreed to make monthly payments of $25. The account is in the process of being resolved (1.d). This is a computer credit card account with a high credit of $1,794 and unpaid and past-due balance of approximately $3,119 that was placed for collection and sold to a debt purchaser. Applicant contacted the debt purchaser, and on August 24, 2015, she agreed to a repayment plan under which she has been making monthly payments of $25 to $50. The account is in the process of being resolved (1.e). This is a bank credit card account with a credit limit of $2,100 and past-due balance of $2,626 that was placed for collection and sold to a debt purchaser. The unpaid and past-due balance was increased to approximately $3,123. Applicant contacted the debt purchaser, and on August 24, 2015, she agreed to a repayment plan under which she has been making monthly payments of between $15 and $50. The account is in the process of being resolved (1.f). This is a lease for an apartment from which Applicant was evicted for failing to pay the rent for two months after she was laid off. The account, with a high credit of $1,697 and a remaining unpaid balance of $2,823, was placed for collection. During her OPM interview, Applicant was under the impression that the collection agent for the account was the collection agent for a credit card account, and she claimed to have reached a settlement. Her impression was incorrect. Applicant expressed some uncertainty regarding the account because she was unsure if the charges included carpet damage from the earlier apartment in the same complex that she shared with her former fiancé. Applicant disputed the account, but failed to indicate the basis or result of her dispute. She recently agreed to make monthly payments of $15. The account is in the process of being resolved (1.g). This is a bank credit card account with a credit limit of $900 and past-due and unpaid balance of $1,327, that was placed for collection, charged off, and sold, in turn, to different debt purchasers. She recently agreed to make monthly payments of $15. The account is in the process of being resolved (1.h). This is a bank credit card account with a credit limit of $500, high credit of $1,108, and a past-due balance of $564, that was placed for collection and sold to a debt purchaser. The unpaid and past-due balance was increased to approximately $1,059. Applicant contacted the debt purchaser, and on August 24, 2015, she agreed to a repayment plan under which she has been making monthly payments of between $15 and $50. The account is in the process of being resolved (1.i). This is a clothing store charge card account with a credit limit of $430 and high credit of $556 that was placed for collection and charged off in 2011. It was sold to a debt purchaser, and the unpaid and past-due balance was increased to $662. Applicant contacted the debt purchaser, and on August 24, 2015, and although she was offered a settlement of $397.42, something she did not feel comfortable agreeing to, she agreed to a repayment plan under which she has been making monthly payments of between $15 and $50. The account is in the process of being resolved (1.j). This is a telephone account with a high credit and unpaid balance of approximately $250 that was placed for collection. Applicant steadfastly and consistently disputed the account contending that she has had both a land line and a cell phone with the same company for a number of years and that both accounts are current. Applicant contended that she called the creditor regarding the SOR account and the creditor was unable to locate any record of a delinquency. She disputed the listing with TransUnion, and her most recent credit report no longer lists the purported delinquency. Applicant’s September 2015 Equifax credit report no longer includes the account. Just to be safe, she recently agreed to make monthly payments of $10 to cover any remaining unpaid balance. The account has either been resolved or is in the process of being resolved (1.k). This is a dental (referred to as a medical) account with a high credit and unpaid balance of $201, that was placed for collection. Applicant stated that the professional dental services rendered cost her over $5,000, and she was unaware that she still owed any remaining balance. She recently agreed to make monthly payments of $10 to cover any remaining unpaid balance. The account has either been resolved or is in the process of being resolved (1.l).

The judge granted the clearance. The government raised disqualifying conditions F.3, E.2. The judge applied mitigating conditions F.2, E.2, F.3. The decision turned on the following: The applicant took proactive steps to address her financial delinquencies by entering into repayment plans with creditors; She provided character references that attested to her trustworthiness and work ethic; The applicant's financial situation was deemed under control, with no additional unidentified delinquencies.

Why the Applicant Prevailed

• The applicant took proactive steps to address her financial delinquencies by entering into repayment plans with creditors.
• She provided character references that attested to her trustworthiness and work ethic.
• The applicant's financial situation was deemed under control, with no additional unidentified delinquencies.

Conditions Referenced

Key Rule Quoted

“The applicant has mitigated the trustworthiness concerns regarding financial considerations and personal conduct.”

Procedural Posture

• SOR issuedAug 3, 2015
• Answer filedAug 28, 2015Supplemented on January 27, 2016
• Hearing heldFeb 3, 2016Record closed on February 23, 2016
• Decision dateOct 13, 2016

Cite For

• Mitigation of Financial Considerations Under Guideline F
• Personal Conduct Concerns Related to Inaccuracies in E-qip Responses
• Demonstrating Proactive Debt Resolution Efforts as a Mitigating Factor