ISCR Case 08-09326.h1

Case Headnote

ISCR Case No. 08-09326.h1

grantedAug 12, 2009· Hon. Rita C. O'Brien· hearing

Summary

A 29-year-old administrative assistant with a bachelor's degree was granted a security clearance despite initial concerns under Guideline F (Financial Considerations). The Statement of Reasons detailed multiple debts, including a bank credit card, hospital bills, cable company debt, federal student loans, a bank student loan, and various credit card and store debts.

The applicant demonstrated significant efforts to resolve these financial issues. She established payment plans for several debts, including a bank credit card, hospital debt, and federal and bank student loans, making consistent payments. For instance, she reduced her federal student loan balance from $39,914 to $38,187 between October 2008 and April 2009. She also successfully paid off multiple debts, such as a cable company account, a store credit card, and a jewelry store debt. Notably, she disputed a credit card balance, reducing it from an alleged $12,500 to approximately $1,900, which she then settled for $385.

The decision to grant clearance was based on the applicant's increased income, her good-faith efforts in establishing and adhering to payment plans, and her diligence in disputing and resolving debts. These actions collectively mitigated the initial financial concerns.

Why the Applicant Prevailed

The applicant demonstrated a significant increase in income, allowing her to address her financial obligations.
She established payment plans for her debts and made consistent payments, showing a good-faith effort to resolve her financial issues.
The applicant successfully disputed and reduced the amount owed on a significant debt, demonstrating diligence in managing her finances.

Conditions Referenced

Disqualifying

AG ¶ 19araisedInability or Unwillingness to Satisfy Debts
AG ¶ 19craisedA History of Not Meeting Financial Obligations

Mitigating

AG ¶ 20bappliedConditions Largely Beyond the Person's Control
AG ¶ 20dappliedGood-faith Effort to Repay Overdue Creditors
AG ¶ 20eappliedReasonable Basis to Dispute Legitimacy of Debt

Key Rule Quoted

“A security clearance decision is intended only to resolve the questions of 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 issuedFeb 3, 2009
Answer filed—Applicant submitted a signed and notarized Answer admitting to most allegations.
Hearing heldApr 28, 2009
Decision dateAug 12, 2009

Cite For

Mitigation of Financial Concerns Under Guideline F
Good-faith Efforts in Resolving Debts
Impact of Increased Income on Financial Stability

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	Bank credit card/judgment: Payment Plan. Applicant contends that this is a duplicate of the debt cited at 1.o. The debt is being collected through a law firm. Applicant contacted the firm in November 2008 and set up a payment plan of $200 per month. She provided evidence that she paid a total of $750 in November and December. Applicant testified that she paid additional amounts on this debt through garnishment of approximately $1,600 to $1,700, but the creditor has been unable to provide records related to the total she has paid through garnishment. She intends to pay the debt in full.	For Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts (e) reasonable, documented basis to dispute the debt	Claimed Debt Paid in Full Documented Payment Plan with Creditor
1.b	Hospital debt: Payment Plan. Applicant was involved in a car accident and was admitted to the hospital. The accident occurred when she was employed but did not have health insurance. Applicant set up a payment plan in late 2008, and pays $200 per month by automatic withdrawal from her bank account. She expects the debt to be satisfied in 2010.	For Applicant	Medical Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Documented Payment Plan with Creditor
1.c	Cable company debt: Paid. Applicant contacted the cable company and confirmed that she had a zero balance for her 2007 account in another state. She obtained a printout showing her bill for that residence was $368.47 and that she paid account in full by November 2007. She has an account now with the same company and it is current. $368	For Applicant	Utility or Phone Debt	Admitted	—	—	Documented Debt Paid in Full
1.d	Student loans debt to federal government: Payment Plan. Applicant fell behind in her student loan payments when she was unemployed and/or underemployed. In October 2008, she established a payment plan of $400 per month. The balance in April 2009 was $38,187, which she had reduced from the $39,914 owed in October 2008.	For Applicant	Student Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Documented Payment Plan with Creditor
1.e–1.j	6 sub-charges — specific text not stated in this decision (for the applicant). (low confidence)	For Applicant			—	—	—
1.k	Student loan owed to bank: Payment Plan. Applicant accepts this debt as her own, and agrees with the balance alleged. She contacted the creditor in regard to this student loan and set up a payment plan of $100 per month, which was verified by a coworker who witnessed the arrangements.	For Applicant	Student Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(b) conditions largely beyond the person’s control; acted responsibly (d) good-faith effort to repay or otherwise resolve debts	Documented Payment Plan with Creditor
1.l	Credit card debt: Paid. Applicant, believing the $12,500 balance listed in her credit bureau report was incorrect, repeatedly contacted the creditor. Ultimately, the company confirmed that the correct balance was approximately $1,900. Applicant then obtained a settlement in the amount of $385, which she paid in May 2009. $1,900	For Applicant	Credit Card Debt	Admitted	—	—	Documented Debt Paid in Full
1.m	Store credit card: Paid. On November 17, 2008, Applicant obtained a settlement offer for $1,137.02 on an original balance of $2,279. She paid the debt on November 20, 2008, and provided supporting documentation.	For Applicant	Credit Card Debt	Admitted	—	—	Documented Debt Paid in Full
1.n	Jewelry store debt: Paid. Applicant paid the balance on this debt in November 2008 and provided supporting documentation.	For Applicant	Credit Card Debt	Admitted	—	—	Documented Debt Paid in Full
1.o	Bank credit card – Payment plan. See allegation 1.a, above. (low confidence)	For Applicant	Credit Card Debt	Unknown	—	—	—
1.p	specific text not stated in this decision	For Applicant	Unspecified Financial	Unknown	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Bank credit card/judgment: Payment Plan. Applicant contends that this is a duplicate of the debt cited at 1.o. The debt is being collected through a law firm. Applicant contacted the firm in November 2008 and set up a payment plan of $200 per month. She provided evidence that she paid a total of $750 in November and December. Applicant testified that she paid additional amounts on this debt through garnishment of approximately $1,600 to $1,700, but the creditor has been unable to provide records related to the total she has paid through garnishment. She intends to pay the debt in full.

For Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(b) conditions largely beyond the person’s control; acted responsibly

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

(e) reasonable, documented basis to dispute the debt

Claimed

Debt Paid in Full

Documented

Payment Plan with Creditor

1.b

Hospital debt: Payment Plan. Applicant was involved in a car accident and was admitted to the hospital. The accident occurred when she was employed but did not have health insurance. Applicant set up a payment plan in late 2008, and pays $200 per month by automatic withdrawal from her bank account. She expects the debt to be satisfied in 2010.

For Applicant

Medical Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(b) conditions largely beyond the person’s control; acted responsibly

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

Documented

Payment Plan with Creditor

1.c

Cable company debt: Paid. Applicant contacted the cable company and confirmed that she had a zero balance for her 2007 account in another state. She obtained a printout showing her bill for that residence was $368.47 and that she paid account in full by November 2007. She has an account now with the same company and it is current.

$368

For Applicant

Utility or Phone Debt

Admitted

—

Documented

Debt Paid in Full

1.d

Student loans debt to federal government: Payment Plan. Applicant fell behind in her student loan payments when she was unemployed and/or underemployed. In October 2008, she established a payment plan of $400 per month. The balance in April 2009 was $38,187, which she had reduced from the $39,914 owed in October 2008.

For Applicant

Student Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(b) conditions largely beyond the person’s control; acted responsibly

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

Documented

Payment Plan with Creditor

1.e–1.j

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

For Applicant

—

1.k

Student loan owed to bank: Payment Plan. Applicant accepts this debt as her own, and agrees with the balance alleged. She contacted the creditor in regard to this student loan and set up a payment plan of $100 per month, which was verified by a coworker who witnessed the arrangements.

For Applicant

Student Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(b) conditions largely beyond the person’s control; acted responsibly

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

Documented

Payment Plan with Creditor

1.l

Credit card debt: Paid. Applicant, believing the $12,500 balance listed in her credit bureau report was incorrect, repeatedly contacted the creditor. Ultimately, the company confirmed that the correct balance was approximately $1,900. Applicant then obtained a settlement in the amount of $385, which she paid in May 2009.

$1,900

For Applicant

Credit Card Debt

Admitted

—

Documented

Debt Paid in Full

1.m

Store credit card: Paid. On November 17, 2008, Applicant obtained a settlement offer for $1,137.02 on an original balance of $2,279. She paid the debt on November 20, 2008, and provided supporting documentation.

For Applicant

Credit Card Debt

Admitted

—

Documented

Debt Paid in Full

1.n

Jewelry store debt: Paid. Applicant paid the balance on this debt in November 2008 and provided supporting documentation.

For Applicant

Credit Card Debt

Admitted

—

Documented

Debt Paid in Full

1.o

Bank credit card – Payment plan. See allegation 1.a, above. (low confidence)

For Applicant

Credit Card Debt

Unknown

—

1.p

specific text not stated in this decision

For Applicant

Unspecified Financial

Unknown

—

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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 ANALYSIS

FORMAL FINDINGS

CONCLUSION

FOOTNOTES