ISCR Case 12-03377.h1

Case Headnote

ISCR Case No. 12-03377.h1

deniedMay 29, 2015· Hon. Robert Robinson Gales· hearing

Summary

A 42-year-old defense contractor employee was denied a security clearance due to concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The denial stemmed from unresolved financial debts and a history of dishonesty on his security clearance application.

Specifically, the applicant falsely answered "no" to questions on his December 20, 2011 e-QIP regarding bills in collection, accounts charged off or cancelled, and debts over 120 days delinquent. At that time, he had several accounts that met these criteria, including a bank automobile loan with an unpaid balance of $10,142, a credit union overdraft of $518, a $264 medical debt from 2008, and a bank credit card account with a $300 balance. He later claimed he was unaware of these debts when completing the e-QIP, having not obtained a credit report.

The judge found that the applicant failed to demonstrate responsible financial behavior or provide evidence of efforts to mitigate his financial issues. This included a lack of good-faith efforts to resolve outstanding debts or seek financial counseling. Consequently, the judge determined that granting a security clearance was not consistent with national interest.

Why the Applicant Was Denied

The applicant had a history of financial difficulties dating back to 2008, including multiple delinquent accounts and debts placed for collection.
The applicant provided false information on his security clearance application regarding his financial status, indicating a lack of judgment and reliability.
The applicant failed to demonstrate any good-faith efforts to resolve his outstanding debts or seek financial counseling.

Conditions Referenced

Disqualifying

AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
AG ¶ 19(c)raisedHistory of Not Meeting Financial Obligations

Mitigating

AG ¶ 20(a)rejectedBehavior Happened Long Ago or InfrequentlyThe applicant's financial issues have been ongoing since 2008, indicating they are not infrequent or long ago.
AG ¶ 20(b)rejectedConditions Largely Beyond the Person's ControlThe applicant did not demonstrate that his financial issues were due to circumstances beyond his control.
AG ¶ 20(c)rejectedReceived Counseling for Financial ProblemsThere is no evidence that the applicant received financial counseling.
AG ¶ 20(d)rejectedGood-faith Effort to Repay DebtsThe applicant did not provide evidence of any efforts to resolve his debts.
AG ¶ 20(e)rejectedReasonable Basis to Dispute Legitimacy of DebtsThe applicant did not present documented proof to dispute the legitimacy of his debts.

Key Rule Quoted

“A person who seeks access to classified information enters into a fiduciary relationship with the Government predicated upon trust and confidence.”
— Department of the Navy v. Egan, 484 U.S. 518, 528 (1988)

Procedural Posture

SOR issuedAug 6, 2014
Answer filedSep 5, 2014Applicant elected to proceed without a hearing.
Hearing held—Case decided on the written record.
Decision dateMay 29, 2015

Cite For

Denial of Security Clearance Due to Unresolved Financial Obligations Under Guideline F
False Statements in Security Clearance Application Under Guideline E
Lack of Evidence for Mitigating Financial Conditions in Security Clearance Cases.

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	On December 20, 2011, when Applicant completed his e-QIP, he responded to questions pertaining to his financial record. Three of those questions in Section 26 – Financial Record (Delinquency Involving Routine Accounts) – asked if, in the past seven years, he had bills or debts turned over to a collection agency; if he had any account or credit card suspended, charged off, or cancelled for failing to pay as agreed; if he was currently over 120 days delinquent on any debt (include financial obligations for which you are the sole debtor, as well as those for which you are a co-signer or guarantor)? Applicant answered “no” to those questions. He certified that the responses were “true, complete, and correct” to the best of his knowledge and belief, but the responses to those questions were, in fact, false for at that time Applicant had several accounts that were either placed for collection, charged off, or cancelled. He subsequently said that he was not sure why he answered those questions the way he did. He later denied intending to falsify his response, and explained that when he completed the e-QIP, he had no knowledge of his debts as he had not previously obtained a credit report.	Against Applicant	Falsification Security FormFOUND DELIBERATE	Financial	Denied	(a) deliberate omission, concealment, or falsification on a security form (c) credible adverse information across areas supporting a whole-person concern	—	—

Allegation

Finding

Conduct

Concealed Issue

Response

Disqualifying (¶16)

Mitigating applied (¶17)

Mitigation

2.a

On December 20, 2011, when Applicant completed his e-QIP, he responded to questions pertaining to his financial record. Three of those questions in Section 26 – Financial Record (Delinquency Involving Routine Accounts) – asked if, in the past seven years, he had bills or debts turned over to a collection agency; if he had any account or credit card suspended, charged off, or cancelled for failing to pay as agreed; if he was currently over 120 days delinquent on any debt (include financial obligations for which you are the sole debtor, as well as those for which you are a co-signer or guarantor)? Applicant answered “no” to those questions. He certified that the responses were “true, complete, and correct” to the best of his knowledge and belief, but the responses to those questions were, in fact, false for at that time Applicant had several accounts that were either placed for collection, charged off, or cancelled. He subsequently said that he was not sure why he answered those questions the way he did. He later denied intending to falsify his response, and explained that when he completed the e-QIP, he had no knowledge of his debts as he had not previously obtained a credit report.

Against Applicant

Falsification Security FormFOUND DELIBERATE

Financial

Denied

(a) deliberate omission, concealment, or falsification on a security form

(c) credible adverse information across areas supporting a whole-person concern

—

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	There is a bank automobile loan with an unpaid balance of $10,142 that was placed for collection and charged off. $10,142	Against Applicant	Auto Loan Debt	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	There is a credit union account that was opened in 2009 and closed in 2010 before one check had cleared, leaving an overdraft balance of $518. The account was placed for collection and charged off. $518	Against Applicant	Unspecified Financial	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.c	There is a medical debt for treatment received by Applicant in 2008 in the amount of $264 that was placed for collection. $264	Against Applicant	Medical Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.d	There is a bank credit card account with a balance of $300 that was placed for collection and sold to a debt purchaser. $300	Against Applicant	Credit Card Debt	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

There is a bank automobile loan with an unpaid balance of $10,142 that was placed for collection and charged off.

$10,142

Against Applicant

Auto Loan Debt

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.b

There is a credit union account that was opened in 2009 and closed in 2010 before one check had cleared, leaving an overdraft balance of $518. The account was placed for collection and charged off.

$518

Against Applicant

Unspecified Financial

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.c

There is a medical debt for treatment received by Applicant in 2008 in the amount of $264 that was placed for collection.

$264

Against Applicant

Medical Debt

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.d

There is a bank credit card account with a balance of $300 that was placed for collection and sold to a debt purchaser.

$300

Against Applicant

Credit Card Debt

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