Summary
A 37-year-old defense contractor was denied a security clearance under Guideline F (Financial Considerations) due to a history of significant unpaid debts and two bankruptcies. The applicant filed for Chapter 13 bankruptcy in 1996, discharged in 1999, and a Chapter 7 petition in May 2005, which was converted to Chapter 13 but dismissed in 2007 due to unmet payments.
The applicant's financial obligations included an $1,689 judgment for a timeshare property debt, $18,488 currently owed in state tax liens (from an alleged $21,174), and $31,838 currently owed in IRS tax liens (from an alleged $43,958). He had begun a $250 monthly payment plan for state taxes and made payment arrangements for IRS debt after wage garnishment. Other debts included $1,482 in utility bills, defaulted student loans, a disputed $1,109 auto loan, $352 in medical debts, and $388 in miscellaneous debts, including a disputed $174 music service debt.
Despite demonstrating personal generosity and stable income, the applicant's total unpaid debts of approximately $72,583 and a lack of consistent effort to resolve them led to the denial. Recent attempts to establish payment plans were deemed insufficient to mitigate the security concerns.
Why the Applicant Was Denied
- The applicant has a history of two bankruptcies and significant unpaid debts totaling approximately $72,583.
- He failed to demonstrate a consistent effort to resolve his financial obligations over the years, raising concerns about his reliability and judgment.
- Recent attempts to establish payment plans were insufficient to mitigate the security concerns.
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 so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to RecurThe applicant's debts are not in the distant past, with approximately $55,000 remaining unpaid.
- AG ¶ 20(b)rejectedConditions That Resulted in the Financial Problem Were Largely Beyond the Person's ControlThe applicant's unemployment occurred more than six years ago and should not affect his ability to pay current debts.
- AG ¶ 20(d)rejectedGood-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant's recent efforts to contact creditors and establish payment plans were insufficient and lacked a track record of payments.
Key Rule Quoted
“A security clearance decision is intended only to resolve whether it is clearly consistent with the national interest for an applicant to either receive or continue to have access to classified information.”
Procedural Posture
- SOR issuedMay 17, 2010
- Answer filedAug 3, 2010Signed and notarized.
- Hearing heldOct 13, 2010
- Decision dateJan 31, 2011
Cite For
- Denial of Security Clearance Due to Unresolved Financial Obligations Under Guideline F
- Insufficient Evidence of Good-faith Efforts to Resolve Debts
- Impact of Financial History on Security Clearance Eligibility