ISCR Case 07-15203.h1

Case Headnote

ISCR Case No. 07-15203.h1

deniedJun 25, 2008· Hon. Wilford H. Ross· hearing

Summary

A 48-year-old married woman, employed as a Warehouse Specialist for a defense contractor, was denied a security clearance due to financial considerations under Guideline F. The applicant, who holds a high school diploma, admitted to significant outstanding debts totaling over $16,000.

Key issues included a federal tax lien for $16,322 from tax years 1992-1995, which a March 1, 2007 credit report showed as unresolved. She also acknowledged multiple other debts, including $1,293 to Capital One Bank (K-Mart), $1,452 to Capital One Bank (credit card), $295 to CITGO/CBSD, $2,750 to Midland Credit Management (Providian National Bank), $1,190 for an Aspire Visa, $7,283 to PRM Financial Services (Chase), and $1,863 to Merchants Credit Guide (Montgomery Ward). For many of these, she had made no payments and expressed no current intention to do so. While she had resolved a state tax liability in 1999 and a $108 cable bill, and had filed late federal and state tax returns for 1997-2000, she had not demonstrated sufficient effort to address her other financial obligations.

The denial was based on the applicant's substantial past-due debts, including the unresolved federal tax lien, and her lack of good-faith efforts to pay her creditors. The judge found that her financial difficulties were not mitigated by circumstances beyond her control.

Why the Applicant Was Denied

The applicant has over $16,000 in past due debts, including a federal tax lien, with no evidence of resolution.
The applicant made no payments on several debts and had no current intention to pay them.
The applicant's financial difficulties were not mitigated by circumstances beyond her control, as she failed to initiate a good-faith effort to pay off her creditors.

Conditions Referenced

Disqualifying

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

Mitigating

AG ¶ 20(b)rejectedConditions That Resulted in the Financial Problem Were Largely Beyond the Person’s ControlThe applicant did not demonstrate a good-faith effort to resolve her debts.
AG ¶ 20(d)rejectedThe Individual Initiated a Good-faith Effort to Repay DebtsThe applicant failed to begin resolving her debts until just before the hearing.

Key Rule Quoted

“Any doubt concerning personnel being considered for access to classified information will be resolved in favor of national security.”

Procedural Posture

SOR issuedDec 21, 2007
Answer filedFeb 1, 2008
Hearing heldApr 21, 2008
Decision dateJun 25, 2008

Cite For

Financial Irresponsibility Under Guideline F
Lack of Good-faith Efforts to Resolve Debts
Impact of Financial Issues on Security Clearance Eligibility

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	The Applicant admits that she is indebted to the Internal Revenue Service (IRS) for back taxes. A credit report dated March 1, 2007, shows a Federal tax lien in the amount of $16,322.00 for tax years 1992, 1993, 1994, and 1995. There is no evidence that this lien has been released or that this amount has been paid. $16,322	Against Applicant	Tax Unpaid	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	The Applicant submitted documentary evidence showing that she had successfully paid off her State tax liability in 1999.	For Applicant	Unspecified Financial	Admitted	—	—	—
1.c	The Applicant admits that she is indebted to Capital One Bank on an account placed for collection by K-Mart in the amount of $1,293.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt. $1,293	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	The Applicant admits that she is indebted to Capital One Bank for a credit card in the amount of $1,452.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt. $1,452	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	The Applicant admits that she is indebted to CITGO/CBSD in the amount of at least $295.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt. $295	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	The Applicant has paid off this $108.00 cable bill. $108	For Applicant	Unspecified Financial	Unknown	—	—	—
1.g	The Applicant admits that she is indebted to Midland Credit Management on an account placed for collection by Providian National Bank in the amount of at least $2,750.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt. $2,750	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	The Applicant admits that she is indebted to a collection agency in the amount of at least $1,190.00 for an Aspire Visa. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt. $1,190	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	The Applicant denies this additional debt for an Aspire Visa. The available documentary evidence and the Applicant’s testimony supports this statement.	For Applicant	Unspecified Financial	Denied	—	—	—
1.j	The Applicant admits that she is indebted to PRM Financial Services on an account placed for collection by Chase in the amount of at least $7,283.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt. $7,283	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.k	The Applicant denies this additional debt for Providian. She has consistently stated that she only had one credit card with them. The available documentary evidence and the Applicant’s testimony supports this statement.	For Applicant	Unspecified Financial	Denied	—	—	—
1.l	The Applicant admits that she is indebted to Merchants Credit Guide on an account placed for collection by Montgomery Ward in the amount of at least $1,863.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt. $1,863	Against Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.m	The Applicant admits that she was late in filing her Federal income tax returns for 1997, 1998, 1999 and 2000. She further testified that all the returns have been filed, she is now timely on her income tax returns, and she submitted copies of her 1999, 2000 and 2001 returns.	For Applicant	Tax Filing Failure	Admitted	—	—	—
1.n	The Applicant admits that she was late in filing her State income tax returns for 1997, 1998, 1999 and 2000. She further testified that all the returns have been filed, she is now timely on her income tax returns, and she submitted copies of her 1999, 2000 and 2001 returns.	For Applicant	Tax Filing Failure	Admitted	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

The Applicant admits that she is indebted to the Internal Revenue Service (IRS) for back taxes. A credit report dated March 1, 2007, shows a Federal tax lien in the amount of $16,322.00 for tax years 1992, 1993, 1994, and 1995. There is no evidence that this lien has been released or that this amount has been paid.

$16,322

Against Applicant

Tax Unpaid

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.b

The Applicant submitted documentary evidence showing that she had successfully paid off her State tax liability in 1999.

For Applicant

Unspecified Financial

Admitted

—

1.c

The Applicant admits that she is indebted to Capital One Bank on an account placed for collection by K-Mart in the amount of $1,293.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt.

$1,293

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.d

The Applicant admits that she is indebted to Capital One Bank for a credit card in the amount of $1,452.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt.

$1,452

Against Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.e

The Applicant admits that she is indebted to CITGO/CBSD in the amount of at least $295.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt.

$295

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.f

The Applicant has paid off this $108.00 cable bill.

$108

For Applicant

Unspecified Financial

Unknown

—

1.g

The Applicant admits that she is indebted to Midland Credit Management on an account placed for collection by Providian National Bank in the amount of at least $2,750.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt.

$2,750

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.h

The Applicant admits that she is indebted to a collection agency in the amount of at least $1,190.00 for an Aspire Visa. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt.

$1,190

Against Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.i

The Applicant denies this additional debt for an Aspire Visa. The available documentary evidence and the Applicant’s testimony supports this statement.

For Applicant

Unspecified Financial

Denied

—

1.j

The Applicant admits that she is indebted to PRM Financial Services on an account placed for collection by Chase in the amount of at least $7,283.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt.

$7,283

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.k

The Applicant denies this additional debt for Providian. She has consistently stated that she only had one credit card with them. The available documentary evidence and the Applicant’s testimony supports this statement.

For Applicant

Unspecified Financial

Denied

—

1.l

The Applicant admits that she is indebted to Merchants Credit Guide on an account placed for collection by Montgomery Ward in the amount of at least $1,863.00. The Applicant has made no payments on this debt, and has no current intention to make payments on this debt.

$1,863

Against Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.m

The Applicant admits that she was late in filing her Federal income tax returns for 1997, 1998, 1999 and 2000. She further testified that all the returns have been filed, she is now timely on her income tax returns, and she submitted copies of her 1999, 2000 and 2001 returns.

For Applicant

Tax Filing Failure

Admitted

—

1.n

The Applicant admits that she was late in filing her State income tax returns for 1997, 1998, 1999 and 2000. She further testified that all the returns have been filed, she is now timely on her income tax returns, and she submitted copies of her 1999, 2000 and 2001 returns.

For Applicant

Tax Filing Failure

Admitted

—

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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