Summary
The applicant, a 30-year-old business development specialist and Navy veteran, faced security clearance denial under Guideline F due to significant financial issues, including over $19,000 in delinquent debts. Despite some mitigating circumstances related to personal hardships, the applicant failed to demonstrate responsible financial management or a clear plan to address her debts, leading to the denial of her security clearance.
Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: The debt in SOR 1.a ($110) was a joint account with her husband for phone services. The bill has been delinquent since 2006, and is not paid (1.a). The debt in SOR 1.b ($260) is a medical debt related to Applicant’s surgery in 2006. She stated she did not receive a bill and has not contacted the creditor to resolve the debt (1.b). The debt in SOR 1.c ($95) is owed to a beauty salon. Applicant incurred it while living in a different state. She was unaware of the debt until she received the SOR. The debt is from 2003. Applicant has not contacted the creditor or paid the debt (1.c). The debt in SOR 1.d ($212) is owed to an electric company. Applicant stated that at the time the bill became due she did not have the money to pay it. She has not contacted the creditor or paid the debt (1.d). Applicant had a company credit card that was authorized for business expenses, for which she was reimbursed. The debt in SOR 1.e ($3,465) is owed to the corporate credit card. She stated: “My bank account was almost $1,000 overdrawn, and due to everyday life expenses, I used it for other things than paying off the card.” She stated her husband took the reimbursement money. She admitted that she was delinquent with payments before she married her second husband. She also admitted that because she was experiencing financial problems she used the credit card for personal expenses. The debt is unpaid (1.e). Applicant is not familiar with the debt in SOR 1.f ($697) and has not contacted the creditor or credit bureau to dispute the debt or resolve the debt (1.f). Applicant had a second corporate credit card that is listed in SOR 1.g ($10,977) and became delinquent in February 2006. She admitted that she made some personal purchases with the card. She was reimbursed for her business expenses, but did not pay the balance on the card, because her husband depleted their account. She became delinquent on the account in February 2006. She stated she contacted the creditor approximately a year ago and they were unwilling to accept a payment arrangement. She has not made any payments on the debt since it became delinquent in 2006 (1.g). The debt in SOR 1.h ($993) is a loan that Applicant originally paid automatically while she was in the Navy. When she was discharged the automatic withdrawal ceased. She did not make payments on the debt after she was discharged. She settled the debt in March 2009. The approximate amount of the settlement was $563 (1.h). Applicant is not familiar with the debt in SOR 1.i ($94). She did not contact the creditor to determine the debts validity or to resolve it (1.i). The debt in SOR 1.j ($223) is a medical debt that was placed for collection in January 2007. It is not resolved (1.j). The debt in SOR 1.k ($809) is owed to a cable company. Applicant thinks the amount is a mistake. She believes, based on a notice she received three days before the hearing, that the amount should be $84. She did not contact the creditor to resolve the debt (1.k).
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, with over $19,000 in delinquent debts; Applicant did not contact most creditors or make efforts to resolve her debts, indicating a lack of responsibility; The applicant's financial issues were not fully mitigated by personal hardships, as many debts were within her control.
Why the Applicant Was Denied
- Applicant has a significant history of not meeting financial obligations, with over $19,000 in delinquent debts.
- Applicant did not contact most creditors or make efforts to resolve her debts, indicating a lack of responsibility.
- The applicant's financial issues were not fully mitigated by personal hardships, as many debts were within her control.
Conditions Referenced
- AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
- AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations
- AG ¶ 20(b)appliedConditions That Resulted in the Financial Problem Were Largely Beyond the Person's ControlSome financial issues stemmed from personal hardships, including divorce and custody battles.
- AG ¶ 20(c)rejectedThe Person Has Received or Is Receiving Counseling for the ProblemInsufficient evidence of effective counseling or a clear plan to resolve financial issues.
- AG ¶ 20(d)rejectedThe Individual Initiated a Good-faith Effort to Repay Overdue CreditorsApplicant did not demonstrate a good-faith effort to resolve most debts.
- AG ¶ 20(e)rejectedThe Individual Has a Reasonable Basis to Dispute the Legitimacy of the Past-due DebtNo documented proof provided to substantiate disputes of debts.
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 issuedMay 29, 2009
- Answer filedJun 24, 2009
- Hearing heldSep 23, 2009
- Decision dateNov 9, 2009
Cite For
- Denial of Security Clearance Due to Significant Financial Issues Under Guideline F
- Failure to Demonstrate Responsible Financial Management
- Impact of Personal Hardships on Financial Obligations