Summary
A 38-year-old male, a U.S. Navy veteran employed by a defense contractor, was denied a security clearance under Guideline F (Financial Considerations). The denial stemmed primarily from over $50,000 in unpaid taxes and a history of failing to file multiple tax returns.
Specifically, the applicant owed at least $52,597 to the IRS for tax years 2006, 2008, and 2009, resulting in a tax lien filed in 2011. He also admitted to not filing state tax returns for seven years (2006, 2008-2013) and a federal tax return for 2006. While the applicant disputed a $70 medical debt, he acknowledged and paid two other past-due debts, one for $175 in medical fees and another for $366 in court fees, after discovering them through a credit monitoring service.
Despite some mitigating conditions being considered, the judge found insufficient evidence to demonstrate that the applicant's financial problems were under control or that he had made arrangements with tax authorities. The significant delinquent taxes and unfiled returns led to the denial of his eligibility for access to classified information.
Why the Applicant Was Denied
- Applicant has over $50,000 in delinquent taxes that remain unpaid.
- Applicant failed to file a Federal tax return for one year and state tax returns for seven years.
- No evidence was provided to demonstrate that financial problems are under control or that he has made arrangements with tax authorities.
Conditions Referenced
- AG ¶ 19(c)raisedHistory of Not Meeting Financial Obligations
- AG ¶ 19(f)raisedFailure to File or Fraudulently Filing Tax Returns
- AG ¶ 20(a)rejectedBehavior Unlikely to RecurApplicant continues to owe significant tax debt.
- AG ¶ 20(b)rejectedConditions Beyond ControlApplicant's financial issues were voluntary.
- AG ¶ 20(c)rejectedFinancial Counseling ReceivedNo evidence of financial counseling was provided.
- AG ¶ 20(d)rejectedGood-faith Effort to Repay DebtsNo evidence of efforts to resolve debts was presented.
- AG ¶ 20(g)rejectedArrangements with Tax AuthorityApplicant did not provide documentation of tax filings or arrangements.
Key Rule Quoted
“Failure to live within one’s means, satisfy debts, and meet financial obligations may indicate poor self-control, lack of judgment, or unwillingness to abide by rules and regulations, all of which can raise questions about an individual’s reliability, trustworthiness, and ability to protect classified or sensitive information.”
Procedural Posture
- SOR issuedDec 13, 2015
- Answer filedJan 23, 2016Date appears to be in error.
- Hearing held—Decided on the written record without a hearing.
- Decision dateJun 30, 2017
Cite For
- Denial of Security Clearance Due to Significant Tax Liabilities Under Guideline F
- Failure to Mitigate Financial Concerns Despite Employment
- Importance of Providing Evidence of Financial Responsibility in Security Clearance Cases