Summary
The applicant, a 38-year-old federal contractor, faced security clearance denial under Guideline F due to unresolved financial issues, including 14 delinquent accounts totaling approximately $204,000. Despite some payments made, the judge found insufficient evidence of a good-faith effort to repay creditors, leading to the denial of the security clearance.
Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: Applicant has received a Cancellation of Debt, IRS Form 1099-C (1099-C), for the mortgage alleged in SOR ¶ 1.a (1.a). Applicant has two charged-off accounts including: a January 2018 charged-off account for $450; and, a November 2017 charged-off account for $953 (1.b). Applicant has received a 1099-C for SOR ¶ 1.c and 1.d (1.c). Applicant has received a 1099-C for SOR ¶ 1.c and 1.d (1.d). Applicant has resolved the motorcycle debt alleged in SOR ¶ 1.e (1.e). Applicant disputes the debts alleged in SOR ¶ 1.f, and 1.i through 1.n (1.f). Applicant has resolved the judgment alleged in SOR ¶ 1.g (1.g). Applicant disputes the debts alleged in SOR ¶ 1.h (1.h). Applicant disputes the debts alleged in SOR ¶ 1.i (1.i).
The judge denied the clearance. The government raised disqualifying conditions AG ¶ 19(c), AG ¶ 19(a). The decision turned on the following: The applicant has a history of not meeting financial obligations, indicating poor self-control and lack of judgment; Despite earning a six-figure salary, the applicant continued to accumulate delinquent accounts; The applicant failed to provide sufficient evidence of financial rehabilitation or a legitimate basis for disputing debts.
Why the Applicant Was Denied
- The applicant has a history of not meeting financial obligations, indicating poor self-control and lack of judgment.
- Despite earning a six-figure salary, the applicant continued to accumulate delinquent accounts.
- The applicant failed to provide sufficient evidence of financial rehabilitation or a legitimate basis for disputing debts.
Conditions Referenced
- AG ¶ 19(c)raisedFinancial ConsiderationsThe applicant's financial problems were largely caused by overextending himself and failing to meet obligations.
- AG ¶ 19(a)raisedFinancial ConsiderationsThe applicant has a history of not meeting financial obligations.
Key Rule Quoted
“Failure to live within one’s means, satisfy debts, and meet financial obligations may indicate poor self-control, lack of judgement, or willingness 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 issuedOct 30, 2015
- Answer filed—
- Hearing heldFeb 13, 2018
- Decision dateAug 21, 2018
Cite For
- Denial of Security Clearance Due to Unresolved Financial Obligations
- Insufficient Evidence of Good-faith Effort to Repay Debts
- Ongoing Financial Issues as a Security Concern