ISCR Case 08-01681.h1

Case Headnote

ISCR Case No. 08-01681.h1

grantedJan 23, 2009· Hon. Matthew E. Malone· hearing

Summary

A 30-year-old network security engineer was granted a security clearance despite initial concerns under Guideline F (Financial Considerations). The applicant had approximately $23,483 in delinquent debts, leading to allegations regarding several specific accounts. These included a BB&T credit card with a balance reduced from $6,570 to $5,169, a Capital One account of $483 repaid in April 2008, and a Navy Federal Credit Union loan reduced from $8,079 to $4,102 through increased monthly payments.

Other resolved debts included $308 to Great Lakes Credit Union and $566 to Hecht Company. The applicant disputed a $118 Direct TV debt from 2001, for which the creditor had no record. A $7,359 debt related to a 2003 car lease return was also disputed; however, the applicant reached a settlement to repay $2,000, with $600 already paid and the remainder due in February 2009.

The judge found that the applicant had made significant progress, resolving about 53% of the alleged debt. The applicant and his wife completed financial management courses and established a bill-tracking system. With a stable financial situation and a net positive cash flow of approximately $1,300 per month, the circumstances leading to past delinquencies were deemed unlikely to recur, resulting in the security clearance being granted.

Why the Applicant Prevailed

The applicant has made significant progress in repaying debts, resolving approximately 53% of the total alleged debt.
The applicant and his wife have taken financial management courses and have implemented a system for tracking and prioritizing bills.
The applicant's current financial situation is stable, with a net positive cash flow of about $1,300 per month.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
AG ¶ 19(b)raisedIndebtedness Caused by Frivolous or Irresponsible Spending
AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(a)appliedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to Recur
AG ¶ 20(b)appliedConditions That Resulted in the Financial Problem Were Largely Beyond the Person's Control
AG ¶ 20(c)appliedThe Person Has Received or Is Receiving Counseling for the Problem
AG ¶ 20(d)appliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors
AG ¶ 20(e)appliedThe Individual Has a Reasonable Basis to Dispute the Legitimacy of the Past-due Debt

Key Rule Quoted

“A security clearance decision is intended to resolve whether it is clearly consistent with the national interest for an applicant to either receive or continue to have access to classified information.”
— Department of the Navy v. Egan, 484 U.S. 518 (1988)

Procedural Posture

SOR issuedJul 14, 2008
Answer filedNot specified
Hearing heldOct 23, 2008
Decision dateJan 23, 2009

Cite For

Mitigating Conditions Under Guideline F for Financial Considerations
Importance of Demonstrating Financial Responsibility and Stability
Whole Person Concept in Security Clearance Evaluations

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 is paying $100 each month to BB&T for a credit card charged off as a business loss. As of October 2008, the balance was reduced from $6,570 to $5,169. $5,169	For Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.b	Applicant repaid a $483 delinquent Capital One credit card account through a collection agency in April 2008. $483	For Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.c	In March 2008, Applicant began making $100 monthly payments on a delinquent loan account with the Navy Federal Credit Union. In December 2008, he increased his monthly payment to $250, the amount owed has decreased from $8,079 to $4,102. $4,102	For Applicant	Personal Loan Debt	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (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	A $308 debt owed to the Great Lakes Credit Union was paid off through a collection agency in April 2008. $308	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.e	A $566 debt owed to Hecht Company was paid off in May 2006. $566	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	(d) good-faith effort to repay or otherwise resolve debts	Documented Debt Paid in Full
1.f	Applicant disputes a Direct TV account listed as delinquent in the amount of $118. He discontinued the service in 2001 when he moved his family after leaving active duty. The creditor has no record of any debt owing or other information about Applicant. $118	For Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	Claimed Debt Disputed with Creditor
1.g	Applicant denied he owes $7,359 after completing a lease agreement for a car in 2003. Applicant leased a car in 1999 and returned it as agreed in 2003. He was told at the time that he owed nothing further. Several months later, he received a bill for over $7,000. Applicant verbally disputed the debt, but did not pursue the matter forcefully until 2008, when he began responding to the government’s concerns about his finances. Neither Applicant nor Department Counsel produced a copy of the lease agreement to determine Applicant’s obligations. Despite the fact he disputes owing this debt, Applicant has reached a settlement agreement with the law firm collecting the debt whereby he will repay $2,000 in satisfaction of the debt. To that end, he has paid $600 and will pay the remainder with his re-enlistment bonus in February 2009. $7,359	For Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	(e) reasonable, documented basis to dispute the debt	Claimed Debt Disputed with Creditor

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Applicant is paying $100 each month to BB&T for a credit card charged off as a business loss. As of October 2008, the balance was reduced from $6,570 to $5,169.

$5,169

For Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

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

Documented

Debt Paid in Full

1.b

Applicant repaid a $483 delinquent Capital One credit card account through a collection agency in April 2008.

$483

For Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

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

Documented

Debt Paid in Full

1.c

In March 2008, Applicant began making $100 monthly payments on a delinquent loan account with the Navy Federal Credit Union. In December 2008, he increased his monthly payment to $250, the amount owed has decreased from $8,079 to $4,102.

$4,102

For Applicant

Personal Loan Debt

Admitted

(a) inability to satisfy debts

(b) unwillingness to satisfy debts regardless of ability

(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

A $308 debt owed to the Great Lakes Credit Union was paid off through a collection agency in April 2008.

$308

For Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

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

Documented

Debt Paid in Full

1.e

A $566 debt owed to Hecht Company was paid off in May 2006.

$566

For Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

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

Documented

Debt Paid in Full

1.f

Applicant disputes a Direct TV account listed as delinquent in the amount of $118. He discontinued the service in 2001 when he moved his family after leaving active duty. The creditor has no record of any debt owing or other information about Applicant.

$118

For Applicant

Unspecified Financial

Denied

(a) inability to satisfy debts

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

—

Claimed

Debt Disputed with Creditor

1.g

Applicant denied he owes $7,359 after completing a lease agreement for a car in 2003. Applicant leased a car in 1999 and returned it as agreed in 2003. He was told at the time that he owed nothing further. Several months later, he received a bill for over $7,000. Applicant verbally disputed the debt, but did not pursue the matter forcefully until 2008, when he began responding to the government’s concerns about his finances. Neither Applicant nor Department Counsel produced a copy of the lease agreement to determine Applicant’s obligations. Despite the fact he disputes owing this debt, Applicant has reached a settlement agreement with the law firm collecting the debt whereby he will repay $2,000 in satisfaction of the debt. To that end, he has paid $600 and will pay the remainder with his re-enlistment bonus in February 2009.

$7,359

For Applicant

Unspecified Financial

Denied

(a) inability to satisfy debts

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

(e) reasonable, documented basis to dispute the debt

Claimed

Debt Disputed with Creditor

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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

WHOLE PERSON CONCEPT

FORMAL FINDINGS

CONCLUSION

FOOTNOTES