ISCR Case 08-03643.h1

Case Headnote

ISCR Case No. 08-03643.h1

deniedApr 23, 2009· Hon. Philip S. Howe· hearing

Summary

A 41-year-old defense contractor residing in Japan was denied a security clearance due to concerns under Guideline B (Foreign Influence) and Guideline F (Financial Considerations). The denial stemmed from significant unresolved debts totaling $52,882 and the potential influence of his Japanese national wife and her family. The judge found that the applicant's financial irresponsibility and lack of transparency regarding his financial situation raised concerns about his reliability and trustworthiness.

Specific financial allegations included a $45 medical debt from 2005, which the applicant paid in 2009, and a $50 video company debt from 2004, also paid in 2009. More substantial issues involved approximately $44,000 in federal student loans, delinquent since 2005, for which the applicant provided evidence of only one $365 payment in January 2009. Additionally, the applicant owed $2,535 to a state taxing authority for an undisclosed tax year, possibly 1994, and while previous tax liens from 2006 were released in 2009, proof of payment for the $2,535 was not submitted.

The denial was based on the applicant's total of $52,882 in delinquent debts, with significant amounts remaining unresolved. The applicant also failed to provide evidence of his current income or financial stability, and his financial issues dated back to 1996, continuing without full resolution until 2009.

Why the Applicant Was Denied

The applicant has a total of $52,882 in delinquent debts, with significant amounts unresolved.
The applicant failed to provide evidence of his current income or financial stability.
The applicant's financial issues date back to 1996 and continued without resolution until 2009.

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(a)rejectedBehavior Happened so Long Ago, Was Infrequent, or Unlikely to RecurThe applicant's financial issues are current and ongoing.
AG ¶ 20(b)rejectedConditions Beyond the Person's ControlThe applicant did not demonstrate that his financial issues were beyond his control.
AG ¶ 20(c)rejectedReceived Counseling for the ProblemThe applicant did not provide evidence of counseling.
AG ¶ 20(d)rejectedGood-faith Effort to Repay Overdue CreditorsThe applicant did not resolve significant debts while incurring new ones.
AG ¶ 20(e)rejectedReasonable Basis to Dispute the Legitimacy of the DebtThe applicant did not provide evidence to dispute any debts.
AG ¶ 20(f)rejectedAffluence From a Legal Source of IncomeThe applicant did not demonstrate affluence.

Key Rule Quoted

“The protection of the national security is the paramount consideration.”

Procedural Posture

SOR issuedNov 20, 2008
Answer filedDec 15, 2008
Hearing held—Decided on written record.
Decision dateApr 23, 2009

Cite For

Denial of Security Clearance Due to Unresolved Financial Obligations
Impact of Foreign Influence Through Marriage on Security Clearance
Failure to Demonstrate Financial Responsibility as a Disqualifying Factor

Editorial summary generated for research. Not legal advice; not a prediction. Verify against the full decision before relying on any quoted language.

¶	Allegation	Finding	Relationship	Country	Response	Disqualifying (¶7)	Mitigating applied (¶8)	Mitigation
2.a	Applicant is married to a Japanese national.	For Applicant	Spouse Dual or Foreign Citizen Immediate Family	Japan LOW RISK / ALLY	Admitted	—	—	—
2.b	Applicant's wife’s parents live in Japan and are citizens of that country.	For Applicant	Parent in Foreign Country Immediate Family	Japan LOW RISK / ALLY	Admitted	—	—	—

Allegation

Finding

Relationship

Country

Response

Disqualifying (¶7)

Mitigating applied (¶8)

Mitigation

2.a

Applicant is married to a Japanese national.

For Applicant

Spouse Dual or Foreign Citizen

Immediate Family

Japan

LOW RISK / ALLY

Admitted

—

2.b

Applicant's wife’s parents live in Japan and are citizens of that country.

For Applicant

Parent in Foreign Country

Immediate Family

Japan

LOW RISK / ALLY

Admitted

—

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	A medical debt for $45. This debt dates from September 2005. Applicant claims this debt should have been paid by the person who assaulted him in 2000. The assault occurred when Applicant returned the two children to their mother after a visit, and he was attacked by the former girlfriend’s new boyfriend. The police were summoned and the attacking boyfriend was arrested. According to Applicant, the perpetrator was found guilty of assault and battery, and he was ordered to pay Applicant’s medical bills. He did not explain anything about the assault and its effect on his earning capacity. Applicant paid it on February 24, 2009, in the amount of $88.72. He submitted a letter from the creditor verifying the payment. $45	For Applicant	Medical Debt	Admitted	—	—	—
1.e	Applicant has a $50 debt to a video company dating from May 2004. Applicant paid this debt on March 3, 2009. He sent a copy of the letter from the creditor as evidence the debt was paid. $50	For Applicant	Unspecified Financial	Admitted	—	—	—
1.g	Applicant owes the U.S. Department of Education about $44,000 total for two student loans according to the February 2009 credit report. These loans were opened in 1991, and were delinquent by September 2005. Applicant obtained an Associate’s of Arts degree in 1993. He did not repay the loans because he never made more than $10 per hour, and could not repay them. Applicant reports in the FORM Response that on January 28, 2009, he contracted with a debt collection service to repay his student loans. Applicant did not include a copy of the agreement with the company. He did include a copy of his bank statement showing one $365 payment to the Department of Education on January 28, 2009. His FORM Response is dated March 7, 2009, and did not provide evidence of any payments after January 28, 2009. $44,000	Against Applicant	Student Loan Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	The SOR alleges that Applicant owes $2,535 to the same state taxing authority for state income tax owed from an undisclosed tax year, possibly 1994. Applicant has not submitted proof the decade-old speeding ticket was paid. Tax liens were filed against Applicant by the state authority in November 2006 for some previous years’ tax liabilities. Those taxes have now been paid, and the liens released. Applicant sent copies of the lien releases, recorded in January 2009. Applicant claims he failed to file his state income tax forms with the form used to show his income was earned outside the continental United States, mistakenly thinking the filing of only the federal tax form would be sufficient to absolve him of any state tax liability under the law. Applicant did not submit any evidence that he worked outside the United States in 1995 or 1996, nor when he started working outside the United States, to be able to avail himself of this provision of the U.S. Tax Code. $2,535	Against Applicant	Tax Unpaid	Denied	(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

A medical debt for $45. This debt dates from September 2005. Applicant claims this debt should have been paid by the person who assaulted him in 2000. The assault occurred when Applicant returned the two children to their mother after a visit, and he was attacked by the former girlfriend’s new boyfriend. The police were summoned and the attacking boyfriend was arrested. According to Applicant, the perpetrator was found guilty of assault and battery, and he was ordered to pay Applicant’s medical bills. He did not explain anything about the assault and its effect on his earning capacity. Applicant paid it on February 24, 2009, in the amount of $88.72. He submitted a letter from the creditor verifying the payment.

$45

For Applicant

Medical Debt

Admitted

—

1.e

Applicant has a $50 debt to a video company dating from May 2004. Applicant paid this debt on March 3, 2009. He sent a copy of the letter from the creditor as evidence the debt was paid.

$50

For Applicant

Unspecified Financial

Admitted

—

1.g

Applicant owes the U.S. Department of Education about $44,000 total for two student loans according to the February 2009 credit report. These loans were opened in 1991, and were delinquent by September 2005. Applicant obtained an Associate’s of Arts degree in 1993. He did not repay the loans because he never made more than $10 per hour, and could not repay them. Applicant reports in the FORM Response that on January 28, 2009, he contracted with a debt collection service to repay his student loans. Applicant did not include a copy of the agreement with the company. He did include a copy of his bank statement showing one $365 payment to the Department of Education on January 28, 2009. His FORM Response is dated March 7, 2009, and did not provide evidence of any payments after January 28, 2009.

$44,000

Against Applicant

Student Loan Debt

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.i

The SOR alleges that Applicant owes $2,535 to the same state taxing authority for state income tax owed from an undisclosed tax year, possibly 1994. Applicant has not submitted proof the decade-old speeding ticket was paid. Tax liens were filed against Applicant by the state authority in November 2006 for some previous years’ tax liabilities. Those taxes have now been paid, and the liens released. Applicant sent copies of the lien releases, recorded in January 2009. Applicant claims he failed to file his state income tax forms with the form used to show his income was earned outside the continental United States, mistakenly thinking the filing of only the federal tax form would be sufficient to absolve him of any state tax liability under the law. Applicant did not submit any evidence that he worked outside the United States in 1995 or 1996, nor when he started working outside the United States, to be able to avail himself of this provision of the U.S. Tax Code.

$2,535

Against Applicant

Tax Unpaid

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

Loading case…

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