Summary
A 56-year-old defense contractor was denied a security clearance under Guideline F (Financial Considerations) due to a history of financial difficulties. The Statement of Reasons cited three bankruptcy filings. The first, a Chapter 7 petition in September 1986, resulted in the discharge of an unspecified number of debts in December 1986. A second Chapter 7 petition in May 1996 led to the discharge of approximately $122,186 in debts on September 5, 1996. Finally, a Chapter 13 petition was filed in February 2009, with a remaining base of $38,083.86 as of October 1, 2009.
The applicant acknowledged his financial problems, attributing them to medical issues affecting his family. However, he failed to provide sufficient evidence to mitigate the government's concerns. Disqualifying conditions included a history of not meeting financial obligations and an inability or unwillingness to satisfy debts.
While mitigating conditions such as the financial problems being largely beyond the applicant's control, a good-faith effort to resolve the debt, and the problems being isolated or not recent were considered, they were not sufficient. The denial was based on the applicant's failure to demonstrate responsible financial management, his continued accumulation of delinquent accounts despite multiple bankruptcies, and his inability to explain the origins of his financial problems or his inability to pay debts.
Why the Applicant Was Denied
- The applicant failed to provide evidence of responsible financial management or mitigation of his financial issues.
- He had a history of bankruptcy filings, with significant debts discharged but continued accumulation of delinquent accounts.
- The applicant did not explain how his financial problems arose or why he was unable to pay his debts.
Conditions Referenced
- AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
- AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations
- AG ¶ 20(a)rejectedBehavior Happened Long Ago or InfrequentlyThe applicant's financial issues were ongoing and not infrequent.
- AG ¶ 20(b)rejectedConditions Largely Beyond the Person's ControlThe applicant did not provide sufficient evidence that his financial issues were beyond his control.
- AG ¶ 20(c)rejectedReceived or Receiving CounselingThe applicant failed to explain the nature of any counseling received.
- AG ¶ 20(d)rejectedGood-faith Effort to Repay CreditorsThe applicant did not demonstrate a good-faith effort to resolve his debts.
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 issuedJan 10, 2010
- Answer filedJan 15, 2010Applicant elected to proceed without a hearing.
- Hearing held—Decision based on written record.
- Decision dateJun 28, 2010
Cite For
- Denial of Security Clearance Due to Ongoing Financial Issues Under Guideline F
- Insufficient Evidence to Mitigate Financial Concerns
- Importance of Demonstrating Good-faith Efforts in Financial Management