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Summary

The applicant, a 68-year-old self-employed defense contractor, faced security clearance denial under Guideline F due to significant unresolved financial issues totaling over $33,000. Despite some debts being resolved, the applicant failed to demonstrate sufficient evidence of financial responsibility or mitigation of ongoing financial concerns, leading to the conclusion that her financial situation posed a risk to national security.

Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: Applicant admits owing this debt in the amount of $19,180. She stated in her Answer that the original creditor informed her that they had issued a Form 1099C concerning this debt. Applicant further stated that she had accepted responsibility for this debt and had reached a payment arrangement with the collection agent. She submitted a proposed agreement from the collection agent wherein they agreed to accept monthly payments of $500 beginning in August 2014 and ending in June 2015. Applicant did not submit any evidence showing that she had fulfilled this agreement, which was due to end a month before she received the FORM. Absent any proof of payment, or that it has been otherwise settled, I find that this debt is not resolved (1.a). Applicant admitted owing a past-due medical debt in the amount of $248. She stated in her Answer that she was investigating the debt. No further information was received. This debt is not resolved (1.b). Applicant admitted owing this past-due debt in the amount of $79. She submitted evidence showing that she paid this debt after receipt of the SOR (1.c). Applicant admitted owing this past-due automobile loan debt in the amount of $9,932. She further states that the subject automobile was destroyed in a collision and that her insurance company paid the debt. Applicant went on to state that the bank indicated there was no debt and that she should file a dispute with the credit agencies. Applicant indicated that she would do so, but no further information was submitted about this debt. Given the state of the record, I find that this debt is unresolved (1.d). Applicant admitted owing this past-due debt in the amount of $3,845. She stated in her Answer that she was in contact with the company and would attempt to make payment arrangements. No further information was submitted about this debt, and I find that it is not resolved (1.e). Applicant admitted owing a past-due medical debt in the amount of $254. She stated in her Answer that she was investigating the debt. No further information was received. This debt is not resolved (1.f). Applicant admitted owing a past-due medical debt in the amount of $25. She provided documentary evidence showing this debt was paid after receipt of the SOR (1.g). Applicant admitted owing a past-due debt to a bank in the amount of $47. She stated in her Answer that she paid the debt, and had submitted the receipt as Attachment H. As stated, the file provided to me does not have an Attachment H. However, given the de minimis amount involved, and in the interest of justice, I find that this debt has been resolved (1.h).

The judge denied the clearance. The government raised disqualifying conditions AG ¶ 19(a), AG ¶ 19(c). The judge applied mitigating conditions AG ¶ 20(a), AG ¶ 20(b), AG ¶ 20(d). The decision turned on the following: Applicant has unresolved debts totaling over $30,000, which have persisted for several years; Applicant did not provide evidence of financial counseling or a budget to demonstrate financial stability; The applicant's financial issues raise concerns about her reliability and trustworthiness.

Why the Applicant Was Denied

• Applicant has unresolved debts totaling over $30,000, which have persisted for several years.
• Applicant did not provide evidence of financial counseling or a budget to demonstrate financial stability.
• The applicant's financial issues raise concerns about her reliability and trustworthiness.

Conditions Referenced

Key Rule Quoted

“Failure or inability to live within one’s means, satisfy debts, and meet financial obligations may indicate poor self-control, lack of judgment, or unwillingness to abide by rules and regulations, all of which can raise questions about an individual’s reliability, trustworthiness and ability to protect classified information.”

Procedural Posture

• SOR issuedJul 14, 2014
• Answer filedAug 4, 2014Applicant requested a decision without a hearing.
• Decision dateJun 7, 2016

Cite For

• Denial of Security Clearance Due to Unresolved Financial Issues Under Guideline F
• Importance of Demonstrating Financial Responsibility for Security Clearance Eligibility
• Application of Whole-person Concept in Evaluating Financial Considerations for Clearance Decisions.