Summary
The applicant, a 44-year-old logistics management analyst and U.S. Army Reserve member, faced security concerns under Guidelines E and F due to financial difficulties and personal conduct issues. The applicant admitted to multiple delinquent accounts totaling approximately $39,324 and failed to demonstrate sufficient progress in resolving these debts. The judge concluded that the applicant did not mitigate the security concerns, resulting in a denial of the security clearance.
Under Guideline E (Personal Conduct) and Guideline F (Financial Considerations), the Statement of Reasons alleged the following: There was an overpayment of unemployment and supplemental benefits in the approximate amount of $7,700 that occurred when Applicant failed to report increased income. She made no effort to resolve the debt. A state income tax refund was intercepted, and on March 10, 2015, $534 was applied to the outstanding balance. On March 11, 2015, the Internal Revenue Service (IRS) applied $383.59 from Applicant’s 2014 income tax refund to the outstanding balance. On an unspecified date, Applicant apparently entered into a repayment arrangement with the state, and she commenced making payments of $51.15, including a $1.15 convenience fee, on May 14, 2015. She has made two additional identical payments that same month. There is limited progress towards debt resolution (1.a). There is a delinquent federal income tax balance for the tax year 2012 in the amount of approximately $2,000. She made no effort to resolve the debt. On March 23, 2015, the IRS applied $2,387.08 from Applicant’s 2014 income tax refund to pay off the tax owed for 2012. The account has been resolved (1.b). There was a corporate credit card used for business expenses with an unpaid balance of approximately $4,123 that Applicant was unable to pay off after she was reimbursed for her travel. Applicant made two payments towards the debt, but both payments were returned for insufficient funds. She agreed to settle the debt and made another payment, but that payment was also returned for insufficient funds in August 2013. The account was charged off. She made no subsequent timely effort to resolve the debt. On April 6, 2015, Applicant agreed to a payroll deduction authorization agreement for the repayment of charges to the company credit card. She authorized that $500 be automatically deducted from her wages each pay period until the balance due was fully repaid. While there is no documentation to indicate that any payments have actually been made, it appears that there is limited progress towards debt resolution (1.c). There are two credit card accounts and a personal loan account with the same credit union with unpaid balances of $4,957, $2,964, and $2,820 that were charged off. She made no effort to resolve the debts. On May 2, 2015, Applicant was offered several settlement offers by the creditor, and she agreed to repay the balances with monthly minimum payments. On June 12, 2015, she made her first agreed-upon payments of $29.31, $28.02, and $49.52. There is limited progress towards debt resolution (1.d). There are a number of other accounts consisting of student loans ($8,527 and $310), credit cards ($1,918; $1,082; $380; $1,015; and $126), charge accounts ($513), and utility accounts ($761; and $128) in varying amounts that were placed for collection, charged off, transferred, or sold to other collection agents. Applicant offered no evidence to indicate that she made any efforts to contact her creditors or resolve those delinquent accounts. The accounts have not been resolved (1.e).
The judge denied the clearance. The government raised disqualifying conditions AG ¶ 19(a), AG ¶ 19(c). The judge applied mitigating conditions AG ¶ 20(b), AG ¶ 20(a), AG ¶ 20(c), AG ¶ 20(d). The decision turned on the following: The applicant failed to provide evidence of a good-faith effort to resolve her delinquent debts; The applicant's financial problems have persisted since 2008, indicating a lack of control over her financial situation; The applicant did not substantiate claims of receiving financial counseling or taking proactive steps to address her debts.
Why the Applicant Was Denied
- The applicant failed to provide evidence of a good-faith effort to resolve her delinquent debts.
- The applicant's financial problems have persisted since 2008, indicating a lack of control over her financial situation.
- The applicant did not substantiate claims of receiving financial counseling or taking proactive steps to address her debts.
Conditions Referenced
- AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
- AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations
- AG ¶ 20(b)appliedConditions That Resulted in the Financial Problem Were Largely Beyond the Person's Control
- AG ¶ 20(a)rejectedBehavior Happened so Long Ago or Was InfrequentThe applicant's financial difficulties have been ongoing since 2008.
- AG ¶ 20(c)rejectedReceived or Is Receiving Counseling for the ProblemThe applicant did not provide evidence of receiving financial counseling.
- AG ¶ 20(d)rejectedInitiated a Good-faith Effort to Repay Overdue CreditorsThe applicant failed to demonstrate a good-faith effort to resolve her 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."”
Procedural Posture
- SOR issuedOct 28, 2014
- Answer filedUndatedApplicant responded to the SOR allegations.
- Hearing heldDec 4, 2014Applicant elected to have the case decided on the written record.
- Decision dateJul 28, 2015
Cite For
- Failure to Mitigate Financial Considerations Under Guideline F
- Lack of Evidence for Good-faith Efforts to Resolve Debts
- Ongoing Financial Difficulties Impacting Security Clearance Eligibility