Summary
A 51-year-old executive vice president was denied a security clearance under Guideline F (Financial Considerations) due to unresolved tax debts from the late 1980s and early 1990s. The Statement of Reasons cited three specific allegations: an outstanding debt of $18,652.13 to a state tax board for tax year 1990, $9,463.86 for tax year 1989, and a $2,570 state tax lien filed in May 1992.
As of October 2013, the applicant had unresolved tax debts totaling $28,573. The judge noted that while some debts were written off due to the statute of limitations, concerns persisted regarding the applicant's financial judgment and responsibility. Disqualifying conditions under AG ¶ 19(a), AG ¶ 19(c), and AG ¶ 19(g) were raised.
Despite the application of mitigating conditions under AG ¶ 20(a), AG ¶ 20(b), AG ¶ 20(c), AG ¶ 20(d), and AG ¶ 20(e), the clearance was denied. The denial was based on the applicant's failure to file timely tax returns for 1989 and 1990, indicating a history of not meeting financial obligations, and a lack of consistent effort to resolve the tax debts, compounded by reliance on poor legal advice.
Why the Applicant Was Denied
- The applicant had unresolved tax debts totaling $28,573 as of October 2013, raising concerns about financial judgment.
- The applicant's failure to file timely tax returns for 1989 and 1990 indicated a history of not meeting financial obligations.
- The applicant's reliance on poor legal advice and lack of consistent efforts to resolve tax debts were significant factors in the denial.
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)rejectedThe Behavior Happened so Long Ago, Was so Infrequent, or Occurred Under Such Circumstances That It Is Unlikely to RecurThe applicant's noncompliance persisted until 2013, indicating ongoing issues.
- AG ¶ 20(b)rejectedThe Conditions That Resulted in the Financial Problem Were Largely Beyond the Person’s ControlThe applicant admitted that the root cause was his own youth and inexperience.
- AG ¶ 20(c)appliedThe Person Has Received or Is Receiving Counseling for the Problem And/or There Are Clear Indications That the Problem Is Being Resolved or Is Under ControlThe applicant indicated he retained an attorney to address his tax issues.
- AG ¶ 20(d)rejectedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsA write-off of debts is not considered a good-faith effort.
- AG ¶ 20(e)rejectedThe Individual Has a Reasonable Basis to Dispute the Legitimacy of the Past-due DebtThe applicant did not provide corroboration for his claims regarding the tax lien.
Key Rule Quoted
“The protection of the national security is the paramount consideration.”
Procedural Posture
- SOR issuedAug 7, 2013
- Answer filednullUndated Answer submitted by applicant.
- Hearing heldnullDecision based on written record.
- Decision dateMay 23, 2014
Cite For
- Denial of Security Clearance Due to Unresolved Financial Obligations Under Guideline F
- Impact of Poor Financial Judgment on Security Clearance Eligibility
- Consideration of the Whole-person Concept in Financial Cases