ISCR Case 12-04457.h1

Case Headnote

ISCR Case No. 12-04457.h1

grantedJul 1, 2012· Hon. Rita C. O'Brien· hearing

Summary

A 48-year-old senior information assurance engineer and Army veteran was initially denied a security clearance under Guideline F (Financial Considerations) due to past financial difficulties. These issues stemmed from low income and marital problems during his deployments, leading to several delinquent debts.

Specifically, the applicant had a $21,625 loan from Creditor A, obtained in 2007, which became delinquent and was sold to Collection Agency B in 2011. Despite legal advice that he was not liable due to the statute of limitations, he chose to establish a payment plan in July 2014, making an initial $1,000 payment and agreeing to subsequent $300 monthly payments. Additionally, a $744 tax debt to County A, which resulted in a lien in November 2011, was paid in full one week later. He also demonstrated consistent payment of taxes to County B through March 2014.

The applicant successfully mitigated these concerns by demonstrating a significant increase in income, enabling him to manage and resolve his debts. He established a payment plan for his remaining delinquent debt and made timely payments on other obligations. Furthermore, he received financial counseling and successfully removed multiple debts from his credit report. As a result, his security clearance was granted.

Why the Applicant Prevailed

The applicant demonstrated a significant increase in income, allowing him to manage and resolve his debts.
He established a payment plan for his remaining delinquent debt and has made timely payments on other obligations.
The applicant received financial counseling and successfully removed multiple debts from his credit report.

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(a)appliedBehavior Happened so Long Ago, Was Infrequent, or Occurred Under Circumstances Unlikely to Recur
AG ¶ 20(b)appliedConditions That Resulted in Financial Problems Were Largely Beyond the Person's Control
AG ¶ 20(c)appliedReceived or Is Receiving Counseling for the Problem And/or Clear Indications That the Problem Is Being Resolved

Key Rule Quoted

“An applicant is not required to establish that he has paid off every debt listed in the SOR. He must only show, as Applicant has, that he has a plan to resolve his debts and has taken action to implement it.”
— ISCR Case No. 07-06482 at 2-3 (App. Bd. May 21, 2008)

Procedural Posture

SOR issuedFeb 28, 2014
Answer filedApr 8, 2014
Hearing heldJun 26, 2014
Decision dateAug 28, 2014

Cite For

Mitigation of Financial Issues Under Guideline F
Impact of Increased Income on Financial Responsibility
Importance of Financial Counseling in Resolving Debts

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

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	$21,625 – PAYMENT PLAN. When Applicant and his wife were having difficulties meeting their financial obligations during his deployments, he applied for and received a loan from Creditor A in 2007. He used it in part to pay off debts. It became delinquent and was sold to Collection Agency B in 2011. Applicant testified that although he made progress on resolving many debts, he could not afford to pay every debt that he owed. His attorney informed him that he was not liable for the debt owed to Creditor A/Collection Agency B based on the state statute of limitations, and he should not pay it. Although Applicant was advised he was not liable, he has chosen to pay it. He established a payment plan with Collection Agency B in July 2014 that requires an initial payment of $1,000, and subsequent monthly payments of $300. He provided a copy of his bank statement showing he has made the initial payment. $21,625	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (c) received/receiving counseling; problem being resolved	Documented Financial Counseling Documented Debt Paid in Full
1.b	$21,625 – PAYMENT PLAN. When Applicant and his wife were having difficulties meeting their financial obligations during his deployments, he applied for and received a loan from Creditor A in 2007. He used it in part to pay off debts. It became delinquent and was sold to Collection Agency B in 2011. Applicant testified that although he made progress on resolving many debts, he could not afford to pay every debt that he owed. His attorney informed him that he was not liable for the debt owed to Creditor A/Collection Agency B based on the state statute of limitations, and he should not pay it. Although Applicant was advised he was not liable, he has chosen to pay it. He established a payment plan with Collection Agency B in July 2014 that requires an initial payment of $1,000, and subsequent monthly payments of $300. He provided a copy of his bank statement showing he has made the initial payment. $21,625	For Applicant	Unspecified Financial	Admitted	(a) inability to satisfy debts (c) a history of not meeting financial obligations	(a) behavior happened long ago / infrequent / unlikely to recur (b) conditions largely beyond the person’s control; acted responsibly (c) received/receiving counseling; problem being resolved	Documented Financial Counseling Documented Debt Paid in Full
1.c	$744 – PAID. The SOR alleges that Applicant owes taxes to County A. The county notified Applicant's employer of a tax lien in November 2011. One week later, on November 29, 2011, Applicant paid the debt in full. He provided a letter from the County A treasurer’s office showing that he has a zero balance. He also provided a tax record covering 2006 through 2013, showing that he has consistently paid the taxes due to his current county of residence, County B, and that as of March 2014 he owes no taxes to County B. $744	For Applicant	Tax Unpaid	Admitted	—	(c) received/receiving counseling; problem being resolved	Documented Debt Paid in Full

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

$21,625 – PAYMENT PLAN. When Applicant and his wife were having difficulties meeting their financial obligations during his deployments, he applied for and received a loan from Creditor A in 2007. He used it in part to pay off debts. It became delinquent and was sold to Collection Agency B in 2011. Applicant testified that although he made progress on resolving many debts, he could not afford to pay every debt that he owed. His attorney informed him that he was not liable for the debt owed to Creditor A/Collection Agency B based on the state statute of limitations, and he should not pay it. Although Applicant was advised he was not liable, he has chosen to pay it. He established a payment plan with Collection Agency B in July 2014 that requires an initial payment of $1,000, and subsequent monthly payments of $300. He provided a copy of his bank statement showing he has made the initial payment.

$21,625

For Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(a) behavior happened long ago / infrequent / unlikely to recur

(b) conditions largely beyond the person’s control; acted responsibly

(c) received/receiving counseling; problem being resolved

Documented

Financial Counseling

Documented

Debt Paid in Full

1.b

$21,625

For Applicant

Unspecified Financial

Admitted

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

(a) behavior happened long ago / infrequent / unlikely to recur

(b) conditions largely beyond the person’s control; acted responsibly

(c) received/receiving counseling; problem being resolved

Documented

Financial Counseling

Documented

Debt Paid in Full

1.c

$744 – PAID. The SOR alleges that Applicant owes taxes to County A. The county notified Applicant's employer of a tax lien in November 2011. One week later, on November 29, 2011, Applicant paid the debt in full. He provided a letter from the County A treasurer’s office showing that he has a zero balance. He also provided a tax record covering 2006 through 2013, showing that he has consistently paid the taxes due to his current county of residence, County B, and that as of March 2014 he owes no taxes to County B.

$744

For Applicant

Tax Unpaid

Admitted

—

(c) received/receiving counseling; problem being resolved

Documented

Debt Paid in Full

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Case Profile

Summary

Why the Applicant Prevailed

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 ANALYSIS

FORMAL FINDINGS

CONCLUSION

FOOTNOTES