ISCR Case 15-04325.h1

Case Headnote

ISCR Case No. 15-04325.h1

deniedMar 28, 2018· Hon. Carol G. Ricciardello· hearing

Summary

A 42-year-old federal contractor and military veteran was denied a security clearance under Guideline F (Financial Considerations) due to unresolved financial issues. These included multiple delinquent debts and a failure to file 2008 federal and state income tax returns. The applicant attributed his financial difficulties to a past divorce but did not provide sufficient evidence of efforts to resolve these issues.

Specific allegations included an admitted $12,167 debt for a repossessed vehicle, which remains unresolved. Other unresolved debts included a $733 debt, a $505 collection account, a $3,229 state tax lien, and a $185 car insurance collection account. The applicant also failed to provide evidence of filing his 2008 tax returns, despite admitting this omission. While some debts were identified as duplicates or found in the applicant's favor, the majority remained unaddressed.

The denial was based on the applicant's unresolved debts totaling over $12,000, including the state tax lien and unfiled tax returns. The applicant failed to provide evidence of payments or concrete efforts to resolve his financial obligations. The recency and ongoing nature of these financial problems raised significant concerns about his reliability, leading to the conclusion that he failed to mitigate the security concerns.

Why the Applicant Was Denied

Applicant has unresolved debts totaling over $12,000, including a state tax lien and failure to file 2008 tax returns.
Applicant did not provide evidence of payments or efforts to resolve his financial obligations.
The applicant's financial problems are recent and ongoing, raising significant questions about his reliability.

Conditions Referenced

Disqualifying

F.1.araisedInability to Satisfy Debts
F.1.braisedUnwillingness to Satisfy Debts Regardless of the Ability to Do So
F.1.craisedA History of Not Meeting Financial Obligations
F.1.graisedFailure to File or Fraudulently Filing Annual Federal, State, or Local Income Tax Returns or Failure to Pay Annual Federal, State, or Local Income Tax as Required

Mitigating

F.20.brejectedConditions That Resulted in the Financial Problem Were Largely Beyond the Person’s ControlWhile the applicant attributed his financial issues to his divorce, he did not act responsibly to resolve them.
F.20.drejectedGood-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant did not provide evidence of any efforts to repay or resolve his debts.
F.20.grejectedArrangements with the Appropriate Tax Authority to File or Pay the Amount OwedThe applicant failed to file his 2008 tax returns and did not provide evidence of compliance.

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.”
— AG ¶ 18

Procedural Posture

SOR issuedJun 21, 2017
Answer filedAug 22, 2017Applicant elected to proceed without a hearing.
Decision dateMar 28, 2018

Cite For

Failure to Mitigate Financial Issues Under Guideline F
Impact of Unresolved Debts on Security Clearance Eligibility
Importance of Providing Evidence of Financial Responsibility in Clearance Cases

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	Applicant admitted the debt in SOR ¶ 1.a ($12,167). In his SOR answer, he stated the debt was for a repossessed vehicle that he was unable to keep up with the payments. No other information was provided. The debt is unresolved. $12,167	Against Applicant	Auto Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Applicant stated in his SOR answer that the debt in SOR ¶ 1.b ($733) and the judgment in ¶ 1.e ($866) were the same debt, and he was currently paying ¶ 1.b. I find the debts are duplicates. He did not provide documented proof that he was making payments on the judgment and it remains unresolved. $733	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	The investigator confronted Applicant with the collection account in SOR ¶ 1.c ($505). In his SOR answer, he admitted the debt and stated he was 'seeking information to start repayment.' He did not provide evidence of his action to resolve the debt in SOR ¶ 1.c. It is unresolved. $505	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	SOR ¶ 1.d ($3,229) alleged a delinquent state tax lien. In his SOR answer, he stated, 'I admit. Currently repaying.' Applicant did not provide evidence that he filed his Federal or state income tax returns or documented proof that he is repaying the state tax lien. $3,229	Against Applicant	Tax Unpaid	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	The judgment in ¶ 1.e ($866) were the same debt, and he was currently paying ¶ 1.b. I find the debts are duplicates. He did not provide documented proof that he was making payments on the judgment and it remains unresolved. $866	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	The investigator confronted Applicant with the collection account in SOR ¶ 1.f ($185) for car insurance. Applicant told the investigator the account became delinquent when he moved, and he thought he had paid the account, but did not. He stated he would contact the creditor and pay the balance in full. In his SOR answer, he denied the debt. He did not provide evidence that he successfully disputed or resolved the debt. $185	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	The investigator confronted Applicant with the debt in SOR ¶ 1.g ($504). Applicant indicated he had no knowledge of the account, but would contact the creditor. It appears SOR ¶ 1.c is the original creditor before the debt was transferred to a collection agency and is a duplicate of SOR ¶ 1.g. I find in his favor for the debt in SOR 1.g. $504	For Applicant	Unspecified Financial	Unknown	—	—	—
1.h	The investigator confronted Applicant with the collection account in SOR ¶ 1.h ($250) owed to a government entity. Applicant told the investigator he had no knowledge of the account and would contact the creditor to resolve it, and if it were his debt, he would pay it. He denied the debt in his SOR answer. He did not provide evidence that he successfully disputed or resolved the debt. $250	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	SOR ¶ 1.i alleged that Applicant failed to file his 2008 Federal and state income tax returns. Applicant’s SOR response was, 'I admit. Will file.'	Against Applicant	Tax Filing Failure	Admitted	(g) unexplained affluence	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Applicant admitted the debt in SOR ¶ 1.a ($12,167). In his SOR answer, he stated the debt was for a repossessed vehicle that he was unable to keep up with the payments. No other information was provided. The debt is unresolved.

$12,167

Against Applicant

Auto Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.b

Applicant stated in his SOR answer that the debt in SOR ¶ 1.b ($733) and the judgment in ¶ 1.e ($866) were the same debt, and he was currently paying ¶ 1.b. I find the debts are duplicates. He did not provide documented proof that he was making payments on the judgment and it remains unresolved.

$733

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.c

The investigator confronted Applicant with the collection account in SOR ¶ 1.c ($505). In his SOR answer, he admitted the debt and stated he was 'seeking information to start repayment.' He did not provide evidence of his action to resolve the debt in SOR ¶ 1.c. It is unresolved.

$505

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.d

SOR ¶ 1.d ($3,229) alleged a delinquent state tax lien. In his SOR answer, he stated, 'I admit. Currently repaying.' Applicant did not provide evidence that he filed his Federal or state income tax returns or documented proof that he is repaying the state tax lien.

$3,229

Against Applicant

Tax Unpaid

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.e

The judgment in ¶ 1.e ($866) were the same debt, and he was currently paying ¶ 1.b. I find the debts are duplicates. He did not provide documented proof that he was making payments on the judgment and it remains unresolved.

$866

Against Applicant

Unspecified Financial

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.f

The investigator confronted Applicant with the collection account in SOR ¶ 1.f ($185) for car insurance. Applicant told the investigator the account became delinquent when he moved, and he thought he had paid the account, but did not. He stated he would contact the creditor and pay the balance in full. In his SOR answer, he denied the debt. He did not provide evidence that he successfully disputed or resolved the debt.

$185

Against Applicant

Unspecified Financial

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.g

The investigator confronted Applicant with the debt in SOR ¶ 1.g ($504). Applicant indicated he had no knowledge of the account, but would contact the creditor. It appears SOR ¶ 1.c is the original creditor before the debt was transferred to a collection agency and is a duplicate of SOR ¶ 1.g. I find in his favor for the debt in SOR 1.g.

$504

For Applicant

Unspecified Financial

Unknown

—

1.h

The investigator confronted Applicant with the collection account in SOR ¶ 1.h ($250) owed to a government entity. Applicant told the investigator he had no knowledge of the account and would contact the creditor to resolve it, and if it were his debt, he would pay it. He denied the debt in his SOR answer. He did not provide evidence that he successfully disputed or resolved the debt.

$250

Against Applicant

Unspecified Financial

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.i

SOR ¶ 1.i alleged that Applicant failed to file his 2008 Federal and state income tax returns. Applicant’s SOR response was, 'I admit. Will file.'

Against Applicant

Tax Filing Failure

Admitted

(g) unexplained affluence

—

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Case Profile

Summary

Why the Applicant Was Denied

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

WHOLE PERSON CONCEPT

FORMAL FINDINGS

CONCLUSION

FOOTNOTES