ISCR Case 15-03919.h1

Case Headnote

ISCR Case No. 15-03919.h1

grantedJun 6, 2017· Hon. John Grattan Metz, Jr.· hearing

Summary

A 42-year-old engineer with honorable military service was granted a security clearance despite initial concerns under Guideline F (Financial Considerations). The applicant faced allegations of delinquent debts totaling over $47,000, including a charged-off credit card account and an unfiled 2012 federal income tax return. Disqualifying conditions F.1.a, F.1.c, and F.1.g were raised.

The applicant successfully mitigated these concerns by demonstrating that the financial difficulties were primarily caused by identity theft perpetrated by an ex-girlfriend, an issue largely beyond his control. He took prompt and proactive steps to address the fraudulent accounts, including filing a criminal complaint.

Furthermore, the applicant made regular payments on his legitimate debts and resolved most of them prior to the Statement of Reasons being issued. Mitigating conditions F.2.a, F.2.b, and F.2.d were applied, leading to the ultimate decision to grant the security clearance.

Why the Applicant Prevailed

The applicant demonstrated that the financial difficulties were primarily due to identity theft, which was beyond his control.
He took prompt action to address the fraudulent debts and filed a criminal complaint against the ex-girlfriend responsible for the identity theft.
The applicant made regular payments on his debts and resolved most of them before the SOR was issued.

Conditions Referenced

Disqualifying

F.1.araisedInability or Unwillingness to Satisfy Debts
F.1.craisedA History of Not Meeting Financial Obligations
F.1.graisedFailure to File Annual Federal, State, or Local Income Tax Returns as Required or the Fraudulent Filing of the Same

Mitigating

F.2.aappliedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to Recur
F.2.bappliedThe Conditions That Resulted in the Financial Problem Were Largely Beyond the Person’s Control and the Individual Acted Responsibly Under the Circumstances
F.2.dappliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve Debts

Key Rule Quoted

“The Government must prove, by substantial evidence, controverted facts alleged in the SOR.”
— Department of the Navy v. Egan, 484 U.S. 518 (1988)

Procedural Posture

SOR issuedJan 8, 2016
Answer filed—Requested decision without hearing.
Hearing held—Decision made without hearing.
Decision dateJun 6, 2017

Cite For

Mitigation of Financial Issues Due to Identity Theft Under Guideline F
Good-faith Efforts to Resolve Debts
Consideration of Circumstances Beyond the Applicant's Control in Financial Matters

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–1.b	2 sub-charges — specific text not stated in this decision (for the applicant).	For Applicant			—	—	—
1.c	SOR debt 1.c is the delinquent credit card account Applicant listed on his June 2013 clearance Application (Item 3). The $3,252 alleged is the past-due amount on the charged-off account in Applicant’s November 2015 credit report (Item 5). $3,252	For Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.d	SOR debt 1.d is the same as SOR debt 1.e, alleged through two different successor creditors (the account numbers match in pertinent part).	For Applicant	Unspecified Financial	Unknown	—	—	—
1.e–1.h	4 sub-charges — specific text not stated in this decision (for the applicant).	For Applicant			—	—	—
1.i	He reported that he had failed to timely file his 2012 Federal income tax return because of the fraud issues.	For Applicant	Tax Filing Failure	Unknown	(g) unexplained affluence	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a–1.b

2 sub-charges — specific text not stated in this decision (for the applicant).

For Applicant

—

1.c

SOR debt 1.c is the delinquent credit card account Applicant listed on his June 2013 clearance Application (Item 3). The $3,252 alleged is the past-due amount on the charged-off account in Applicant’s November 2015 credit report (Item 5).

$3,252

For Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(d) good-faith effort to repay or otherwise resolve debts

Documented

Debt Paid in Full

1.d

SOR debt 1.d is the same as SOR debt 1.e, alleged through two different successor creditors (the account numbers match in pertinent part).

For Applicant

Unspecified Financial

Unknown

—

1.e–1.h

4 sub-charges — specific text not stated in this decision (for the applicant).

For Applicant

—

1.i

He reported that he had failed to timely file his 2012 Federal income tax return because of the fraud issues.

For Applicant

Tax Filing Failure

Unknown

(g) unexplained affluence

—

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Case Profile

Summary

Why the Applicant Prevailed

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

FORMAL FINDINGS

CONCLUSION

FOOTNOTES