ISCR Case 16-01209.h1

Case Headnote

ISCR Case No. 16-01209.h1

deniedJul 1, 2016· Hon. LeRoy F. Foreman· hearing

Summary

A 63-year-old ship designer was denied a security clearance under Guideline F (Financial Considerations) due to a history of financial difficulties, including numerous delinquent debts and a Chapter 7 bankruptcy. The Statement of Reasons (SOR) detailed multiple outstanding obligations. Thirteen of the alleged debts were medical, incurred when the applicant lacked insurance. Other specific debts included a $4,052 collection account (also listed as $3,562), a $325 telecommunication bill, a $65 retail pharmacy debt, and an unresolved $215 debt. The applicant admitted to the Chapter 7 bankruptcy.

Disqualifying conditions related to financial irresponsibility were raised. While several mitigating conditions were considered, they were ultimately insufficient. The denial was based on the applicant's numerous unresolved debts, totaling approximately $4,167, which demonstrated a lack of responsibility toward creditors.

The applicant's financial problems were further complicated by choices to prioritize luxury items over debt resolution. Crucially, the applicant failed to provide sufficient evidence of recent efforts to resolve all delinquent debts, leading to the final decision to deny the security clearance.

Why the Applicant Was Denied

The applicant has numerous unresolved debts totaling approximately $4,167, reflecting a lack of responsibility toward creditors.
The applicant's financial issues were exacerbated by choices to prioritize luxury items over debt resolution.
The applicant did not provide sufficient evidence of recent efforts to resolve all delinquent debts.

Conditions Referenced

Disqualifying

AG ¶ 19(a)appliedInability or Unwillingness to Satisfy Debts
AG ¶ 19(c)appliedA History of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(b)appliedConditions Largely Beyond the Person's ControlThe primary cause of the bankruptcy was the applicant's unemployment.
AG ¶ 20(d)appliedGood-faith Effort to Repay Overdue CreditorsThe applicant has been making payments on medical debts.
AG ¶ 20(a)rejectedBehavior Happened Long Ago or InfrequentlyThe applicant's debts are numerous and recent.
AG ¶ 20(c)rejectedReceived Counseling for the ProblemThe applicant has not sought financial counseling beyond what was required for bankruptcy.
AG ¶ 20(e)rejectedDispute Legitimacy of Past-due DebtThe applicant did not provide evidence of payment for disputed debts.

Key Rule Quoted

“A security clearance adjudication is an evaluation of an individual’s judgment, reliability, and trustworthiness. It is not a debt-collection procedure.”

Procedural Posture

SOR issuedJul 8, 2016
Answer filedAug 15, 2016
Hearing heldMar 21, 2017
Decision date[Not specified]

Cite For

Evaluation of Financial Irresponsibility Under Guideline F
Impact of Unresolved Debts on Security Clearance Eligibility
Consideration of Whole-person Factors in Clearance Decisions

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	Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.	For Applicant	Medical 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	Claimed Debt Paid in Full
1.b	The debts alleged in SOR ¶¶ 1.b (collection account for $4,052) and 1.r (collection account for $3,562) are the same debt.	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.	For Applicant	Medical 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	Claimed Debt Paid in Full
1.d	Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.	For Applicant	Medical 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	Claimed Debt Paid in Full
1.e	Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.	For Applicant	Medical 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	Claimed Debt Paid in Full
1.f	Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.	For Applicant	Medical 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	Claimed Debt Paid in Full
1.g	Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.	For Applicant	Medical 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	Claimed Debt Paid in Full
1.h	The $325 telecommunication bill alleged in SOR ¶ 1.h and reflected in the March 2016 CBR. $325	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.	For Applicant	Medical 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	Claimed Debt Paid in Full
1.j–1.n	5 sub-charges — specific text not stated in this decision (for the applicant). (low confidence)	For Applicant			—	—	—
1.o	The $65 debt to a retail pharmacy alleged in SOR ¶ 1.o is unresolved. $65	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.p	Applicant admitted the Chapter 7 bankruptcy alleged in SOR ¶ 1.p.	For Applicant	Bankruptcy Filing	Admitted	—	—	Claimed Chapter 7 Bankruptcy
1.q	Applicant admitted the Chapter 7 bankruptcy alleged in SOR ¶ 1.p.	For Applicant	Bankruptcy Filing	Admitted	—	—	Claimed Chapter 7 Bankruptcy
1.r	The $215 debt alleged in SOR ¶ 1.s is unresolved. $215	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.s	The $215 debt alleged in SOR ¶ 1.s is unresolved. $215	Against Applicant	Unspecified Financial	Unknown	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.

For Applicant

Medical 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

Claimed

Debt Paid in Full

1.b

The debts alleged in SOR ¶¶ 1.b (collection account for $4,052) and 1.r (collection account for $3,562) are the same debt.

For Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.c

Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.

For Applicant

Medical 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

Claimed

Debt Paid in Full

1.d

Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.

For Applicant

Medical 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

Claimed

Debt Paid in Full

1.e

Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.

For Applicant

Medical 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

Claimed

Debt Paid in Full

1.f

Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.

For Applicant

Medical 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

Claimed

Debt Paid in Full

1.g

Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.

For Applicant

Medical 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

Claimed

Debt Paid in Full

1.h

The $325 telecommunication bill alleged in SOR ¶ 1.h and reflected in the March 2016 CBR.

$325

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.i

Thirteen of the debts alleged in the SOR were medical debts, incurred by Applicant at a time when he did not have medical insurance.

For Applicant

Medical 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

Claimed

Debt Paid in Full

1.j–1.n

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

For Applicant

—

1.o

The $65 debt to a retail pharmacy alleged in SOR ¶ 1.o is unresolved.

$65

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.p

Applicant admitted the Chapter 7 bankruptcy alleged in SOR ¶ 1.p.

For Applicant

Bankruptcy Filing

Admitted

—

Claimed

Chapter 7 Bankruptcy

1.q

Applicant admitted the Chapter 7 bankruptcy alleged in SOR ¶ 1.p.

For Applicant

Bankruptcy Filing

Admitted

—

Claimed

Chapter 7 Bankruptcy

1.r

The $215 debt alleged in SOR ¶ 1.s is unresolved.

$215

Against Applicant

Unspecified Financial

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.s

The $215 debt alleged in SOR ¶ 1.s is unresolved.

$215

Against Applicant

Unspecified Financial

Unknown

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

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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

POLICIES

ANALYSIS

WHOLE PERSON CONCEPT

FORMAL FINDINGS

CONCLUSION

FOOTNOTES