Summary
A 49-year-old technical training specialist and former U.S. Navy officer was denied a security clearance under Guideline F, Financial Considerations, due to significant unresolved financial issues. The Statement of Reasons cited two specific debts to mortgage lenders, one for $401,000 and another for $163,000, totaling $564,000.
The denial was based on several disqualifying conditions, including the applicant's default on these two mortgages, which resulted in foreclosure and outstanding deficiencies. Additionally, the applicant failed to file state income tax returns for both 2008 and 2009, further indicating poor financial management.
Despite the consideration of several mitigating conditions, the judge determined that the applicant's financial problems were not due to circumstances beyond his control, nor did he take sufficient responsible actions to resolve the mortgage deficiencies post-foreclosure. Consequently, the judge concluded that the applicant did not demonstrate the necessary reliability or good judgment for a security clearance.
Why the Applicant Was Denied
- Applicant defaulted on two mortgages totaling $564,000, leading to foreclosure and unresolved deficiencies.
- Applicant failed to file state income tax returns for 2008 and 2009, indicating poor financial management.
- Applicant did not take sufficient action to resolve his mortgage deficiencies after foreclosure.
Conditions Referenced
- AG ¶ 19(a)appliedInability or Unwillingness to Satisfy Debts
- AG ¶ 19(c)appliedA History of Not Meeting Financial Obligations
- AG ¶ 19(g)appliedFailure to File Annual Federal, State, or Local Income Tax Returns as Required
- AG ¶ 20(a)rejectedBehavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to RecurDefaults were recent and not unlikely to recur.
- AG ¶ 20(b)rejectedConditions That Resulted in the Financial Problem Were Largely Beyond the Person's ControlWhile some conditions were beyond control, applicant did not act responsibly post-foreclosure.
- AG ¶ 20(c)rejectedReceived or Is Receiving Counseling for the Problem And/or There Are Clear Indications That the Problem Is Being Resolved or Is Under ControlApplicant has not sought financial counseling.
- AG ¶ 20(d)rejectedInitiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsApplicant has not contacted mortgagees to resolve deficiencies.
- AG ¶ 20(e)rejectedHas a Reasonable Basis to Dispute the Legitimacy of the Past-due DebtApplicant admitted the mortgage debts are unresolved.
Key Rule Quoted
“Eligibility for a security clearance is predicated upon the applicant meeting the criteria contained in the AG.”
Procedural Posture
- SOR issuedMay 17, 2011
- Answer filedJun 30, 2011
- Hearing heldSep 7, 2011
- Decision dateSep 30, 2011
Cite For
- Denial of Security Clearance Due to Unresolved Financial Obligations Under Guideline F
- Impact of Failure to File State Tax Returns on Security Clearance Eligibility
- Insufficient Evidence of Responsible Financial Management Post-foreclosure