ISCR Case 09-06540.h1

Case Headnote

ISCR Case No. 09-06540.h1

deniedJul 1, 2009· Hon. Arthur E. Marshall, Jr.· hearing

Summary

A 42-year-old financial budget analyst was denied a security clearance due to concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The denial stemmed from multiple delinquent debts and omissions on her security clearance application. Specifically, the applicant failed to disclose several delinquent debts and a judgment on her e-QIP, and did not provide truthful and candid answers during the security clearance process.

The applicant had numerous outstanding debts, including two unpaid judgments for $5,058 and $910, respectively. Other significant debts included a past-due primary mortgage of $1,638 on a $238,000 loan, a charged-off mortgage of $58,500, and a charged-off credit card balance of $3,652. Additionally, there were two collection accounts totaling $899 and $3,890, an unpaid student loan of $1,500, and a charged-off account of $5,316 related to a honeymoon trip.

Despite the applicant's claims of financial hardship due to supporting ailing parents and a declining real estate market, the judge found insufficient evidence of efforts to resolve her debts. Most debts remained unaddressed or unresolved, and the applicant did not present a financial plan or strategy to address them. Consequently, the security clearance was denied.

Why the Applicant Was Denied

The applicant failed to provide sufficient evidence of efforts to address her delinquent debts.
Most of the applicant's debts remained unaddressed or unresolved, raising security concerns.
The applicant did not present a financial plan or strategy for addressing her debts.

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(b)appliedConditions That Resulted in the Behavior Were Largely Beyond the Person’s Control
AG ¶ 20(d)rejectedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant's lack of documentary evidence regarding her debts prevented application.
AG ¶ 20(c)rejectedThe Person Has Received or Is Receiving Counseling for the Problem And/or There Are Clear Indications That the Problem Is Being Resolved or Is Under ControlInsufficient evidence of progress on debts.

Key Rule Quoted

“The clearly consistent standard indicates that security clearance determinations should err, if they must, on the side of denials.”

Procedural Posture

SOR issuedApr 1, 2010
Answer filedApr 30, 2010
Hearing heldAug 5, 2010
Decision dateAug 31, 2010

Cite For

Insufficient Evidence of Financial Rehabilitation Under Guideline F
Impact of Personal Conduct on Security Clearance Eligibility
Importance of Documentary Evidence in Mitigating Financial Concerns

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

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a	Applicant failed to identify her delinquent debts and judgment on her e-QIP.	For Applicant	Omission or Failure to Disclose	Financial	Denied	—	(e) positive steps to reduce vulnerability to exploitation	—
2.b	Applicant failed to provide truthful and candid answers during the security clearance process.	For Applicant	Lack of Candor in Interview	—	Denied	—	(e) positive steps to reduce vulnerability to exploitation	—

Allegation

Finding

Conduct

Concealed Issue

Response

Disqualifying (¶16)

Mitigating applied (¶17)

Mitigation

2.a

Applicant failed to identify her delinquent debts and judgment on her e-QIP.

For Applicant

Omission or Failure to Disclose

Financial

Denied

—

(e) positive steps to reduce vulnerability to exploitation

—

2.b

Applicant failed to provide truthful and candid answers during the security clearance process.

For Applicant

Lack of Candor in Interview

—

Denied

—

(e) positive steps to reduce vulnerability to exploitation

—

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Judgment ($5,058) – Unpaid. This debt represents a loan taken by Applicant to help pay for her 2001 wedding. She stopped making payments on the loan in about 2003 or 2004, when she no longer had sufficient funds to make the payments. $5,058	Against Applicant	Judgment Against Applicant	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	Judgment ($910) – Unpaid. Applicant offered no documentary evidence showing that she has addressed this balance. $910	Against Applicant	Judgment Against Applicant	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	Mortgage ($238,000), Past due ($1,638) – Current. Applicant was past due on her primary home loan mortgage for the home she purchased in 2005. $238,000	For Applicant	Mortgage or Home Loan Debt	Denied	—	—	—
1.d	Charged-off Mortgage ($58,500) – Unpaid. This debt represents 40% of the home loan mortgage assumed for the 2005 house purchase. $58,500	Against Applicant	Mortgage or Home Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	Charged-off Credit Card balance ($3,652) – Unpaid. Applicant stopped making payments on this card in 2006. $3,652	Against Applicant	Credit Card Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	Collection account ($899) – No evidence of payment. Applicant stopped paying on this account in the mid-2000s. $899	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	Collection account ($3,890) – No evidence of payment. Applicant stopped paying on this account in the mid-2000s. $3,890	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	Student loan ($1,500) – Unpaid. This loan was taken in 1999. Although she has not been enrolled as a full-time student since that time, Applicant testified this loan remains in deferral. $1,500	Against Applicant	Student Loan Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	Charged-off Account ($5,316) – Unpaid. For her honeymoon, Applicant tried to defray expenses by accepting a free trip to a resort property with a time-share component. $5,316	Against Applicant	Unspecified Financial	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

Judgment ($5,058) – Unpaid. This debt represents a loan taken by Applicant to help pay for her 2001 wedding. She stopped making payments on the loan in about 2003 or 2004, when she no longer had sufficient funds to make the payments.

$5,058

Against Applicant

Judgment Against Applicant

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.b

Judgment ($910) – Unpaid. Applicant offered no documentary evidence showing that she has addressed this balance.

$910

Against Applicant

Judgment Against Applicant

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.c

Mortgage ($238,000), Past due ($1,638) – Current. Applicant was past due on her primary home loan mortgage for the home she purchased in 2005.

$238,000

For Applicant

Mortgage or Home Loan Debt

Denied

—

1.d

Charged-off Mortgage ($58,500) – Unpaid. This debt represents 40% of the home loan mortgage assumed for the 2005 house purchase.

$58,500

Against Applicant

Mortgage or Home Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.e

Charged-off Credit Card balance ($3,652) – Unpaid. Applicant stopped making payments on this card in 2006.

$3,652

Against Applicant

Credit Card Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.f

Collection account ($899) – No evidence of payment. Applicant stopped paying on this account in the mid-2000s.

$899

Against Applicant

Unspecified Financial

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.g

Collection account ($3,890) – No evidence of payment. Applicant stopped paying on this account in the mid-2000s.

$3,890

Against Applicant

Unspecified Financial

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.h

Student loan ($1,500) – Unpaid. This loan was taken in 1999. Although she has not been enrolled as a full-time student since that time, Applicant testified this loan remains in deferral.

$1,500

Against Applicant

Student Loan Debt

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.i

Charged-off Account ($5,316) – Unpaid. For her honeymoon, Applicant tried to defray expenses by accepting a free trip to a resort property with a time-share component.

$5,316

Against Applicant

Unspecified Financial

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

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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

FOOTNOTES