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Summary

The applicant, a 48-year-old retired Navy commander and financial analyst, faced security clearance denial under Guideline F due to unresolved financial issues, including a history of delinquent debts and a prior bankruptcy. Despite some efforts to address his debts through a credit counseling program, the judge found insufficient evidence of responsible financial management or a credible repayment plan.

Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: Applicant denies the debt in SOR ¶ 1.a ($217) and believes he paid all of his accounts with this creditor. The debt is unresolved (1.a). Applicant denies the debt in SOR ¶ 1.b ($942) because he currently has an account with this creditor and does not believe he would be able to have service with them if he had a delinquent balance. The debt is being verified through the CCP and is unresolved (1.b). Applicant admitted he had cable service with the creditor in SOR ¶ 1.c ($414), but terminated it due to poor service. The debt is unresolved (1.c). The debts in SOR ¶¶ 1.d ($208), 1.e ($55), 1.f ($207), 1.g ($134), 1.h ($208) are medical debts that Applicant believes should be covered by TRICARE, his military medical insurance. The debts are pending review by TRICARE. At least one debt is more than three years old. The debts are unresolved (1.d). The judgment in SOR ¶ 1.i ($9,876) is for legal services. The debt is unresolved (1.i). The debt in SOR ¶ 1.j ($34) is paid (1.j). The debt in SOR ¶ 1.k ($6,388) is for a vacation package Applicant purchased in 2005 while he was separated from his first wife. The debt has been deleted from his CBR (1.k). The debt in SOR ¶ 1.l ($897) was a credit card debt from 2004 or 2005. He disputed the account and it was deleted from his credit report (1.l). The debt in SOR ¶ 1.m ($229) is a cable services debt. He disputed the debt and it was removed from his CBR (1.m). The debt in SOR ¶ 1.n ($465) is for television services. The debt is not resolved (1.n). The judgment in SOR ¶ 1.o ($1,240) is unpaid. Applicant was unable to pay the debt due to other debts he incurred from his divorce. He admitted that he is now able to pay it, but has not (1.o). The judgment in SOR ¶ 1.p ($1,240) is unpaid. Applicant was unable to pay the debt due to other debts he incurred from his divorce. He admitted that he is now able to pay it, but has not (1.p). The debts in SOR ¶ 1.q ($807) are being verified by CCP. They are unresolved (1.q). The debts in SOR ¶ 1.r ($636) are being verified by CCP. They are unresolved (1.r). The judgment in SOR ¶ 1.s ($4,650) is for a debt that was awarded to his ex-wife in their divorce. He has satisfied his portion of the debt, and she remains responsible for the remainder (1.s). The debt in SOR ¶ 1.t ($1,345) is to a phone company. Applicant admitted he had the service in 2000 to 2001, and he is attempting to verify if it is a valid account or one that his ex-wife was responsible for. He has not resolved the debt (1.t). The debt in SOR ¶ 1.u ($1,412) is for a health club membership. Applicant admitted he contracted for the services in 2005 to 2006. He stated he canceled the membership. He does not deny the debt, but stated he is negotiating a settlement agreement (1.u). The debt in SOR ¶ 1.v ($402) is for utility services from the city where Applicant used to live. He stated he paid the debt, but provided no documentation to prove it (1.v). The debt in SOR ¶ 1.w ($472) is for utility services from the city where Applicant used to live. He stated he paid the debt, but provided no documentation to prove it (1.w). The debt in SOR ¶ 1.x ($116) is for utility services from the city where Applicant used to live. He stated he paid the debt, but provided no documentation to prove it (1.x).

The judge denied the clearance. The government raised disqualifying conditions AG ¶ 19(a), AG ¶ 19(c). The judge applied mitigating conditions AG ¶ 20(b), AG ¶ 20(c), AG ¶ 20(d), AG ¶ 20(e). The decision turned on the following: Applicant has a significant history of not meeting financial obligations, including a prior bankruptcy and numerous unresolved debts; Applicant failed to demonstrate a clear understanding of his finances and did not have a budget or a credible plan for debt repayment; The applicant's recent financial behavior raised concerns about his reliability and trustworthiness.

Why the Applicant Was Denied

• Applicant has a significant history of not meeting financial obligations, including a prior bankruptcy and numerous unresolved debts.
• Applicant failed to demonstrate a clear understanding of his finances and did not have a budget or a credible plan for debt repayment.
• The applicant's recent financial behavior raised concerns about his reliability and trustworthiness.

Conditions Referenced

Key Rule Quoted

“Failure or inability 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 information.”

Procedural Posture

• SOR issuedJul 23, 2009
• Answer filedAug 24, 2009
• Hearing heldNov 5, 2009
• Decision dateDec 7, 2009

Cite For

• Denial of Security Clearance Due to Unresolved Financial Obligations Under Guideline F
• Insufficient Evidence of Responsible Financial Management
• Impact of Prior Bankruptcy on Current Financial Reliability