Summary
A 56-year-old federal contractor and retired Navy senior chief petty officer was denied a security clearance due to concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The denial stemmed from significant financial mismanagement and the misuse of a company credit card. The judge determined that the applicant's recent financial issues demonstrated poor judgment, raising doubts about his reliability and trustworthiness.
The Statement of Reasons detailed several financial issues, including multiple credit card accounts referred for collection in 2012 and 2014 for amounts of $3,593 and $3,834, respectively. An installment purchase for electronics and appliances was referred for collection in November 2013 for $2,897, and a cell phone account was referred for collection in November 2012 for $664. Additionally, a collection account was opened in October 2013 for $52. The applicant also faced state tax liens filed in January 2014 for $1,912 and in February 2014 for $13,349, alongside delinquent state and federal taxes for tax years 2011 and 2012.
The denial was based on the applicant's admitted financial obligations and failure to file tax returns, which indicated a lack of financial responsibility. The misuse of a company credit card was deemed a substantial breach of trust, further questioning his judgment and reliability. The applicant did not demonstrate that his financial problems were under control or that he had received financial counseling.
Why the Applicant Was Denied
- The applicant admitted to numerous financial obligations and failures to file tax returns, indicating a lack of financial responsibility.
- The applicant's misuse of a company credit card constituted a substantial breach of trust, raising questions about his judgment and reliability.
- The applicant did not demonstrate that his financial problems were under control or that he had received financial counseling.
Conditions Referenced
- AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
- AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations
- AG ¶ 19(d)raisedDeceptive or Illegal Financial Practices
- AG ¶ 19(e)raisedConsistent Spending Beyond One’s Means
- AG ¶ 19(g)raisedFailure to File Annual Federal, State, or Local Income Tax Returns
- AG ¶ 16(c)raisedCredible Adverse Information in Several Adjudicative Issue Areas
- AG ¶ 16(d)raisedCredible Adverse Information Not Covered Under Any Other Guideline
- AG ¶ 16(e)raisedPersonal Conduct Creating Vulnerability to Exploitation
- AG ¶ 20(a)rejectedBehavior Happened so Long Ago or InfrequentlyApplicant's debts are numerous and recent.
- AG ¶ 20(b)rejectedConditions Beyond the Person's ControlMisuse of the credit card was a voluntary act.
- AG ¶ 20(c)rejectedReceived or Receiving CounselingApplicant has not received financial counseling.
- AG ¶ 20(d)appliedGood-faith Effort to Repay Overdue CreditorsApplicant has made payments on some debts.
- AG ¶ 20(e)rejectedReasonable Basis to Dispute Legitimacy of DebtApplicant has not disputed the debts.
- AG ¶ 17(c)rejectedOffense Is Minor or Unlikely to RecurMisuse of the credit card was a substantial breach of trust.
- AG ¶ 17(d)rejectedAcknowledged Behavior and Obtained CounselingApplicant has not taken steps to alleviate the circumstances.
- AG ¶ 17(e)rejectedPositive Steps to Reduce VulnerabilityApplicant has not taken steps to mitigate vulnerabilities.
Key Rule Quoted
“Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the AG.”
Procedural Posture
- SOR issuedOct 30, 2015
- Answer filedDec 15, 2015
- Hearing heldMay 12, 2016
- Decision dateAug 29, 2016
Cite For
- Denial of Security Clearance Due to Financial Irresponsibility Under Guideline F
- Misuse of Company Credit Card as a Breach of Trust Under Guideline E
- Failure to Demonstrate Financial Stability and Responsibility as a Basis for Security Clearance Denial.