Summary
A 60-year-old applicant with advanced degrees and military service was denied a security clearance under Guideline F, Financial Considerations, due to unresolved financial issues. The Statement of Reasons detailed multiple outstanding debts, including a primary mortgage with a total loan balance of approximately $222,786 and a past-due balance of approximately $56,250, and a second mortgage with a total loan balance of approximately $56,250 and a past-due balance of approximately $53,633.
Additional allegations included another mortgage account with a total loan balance of approximately $175,020 and a past-due balance of approximately $53,633. The applicant also had several credit card debts with past-due balances of approximately $11,105, $7,663, $5,543, and $4,434. These issues raised disqualifying conditions F.19(a) and F.19(c).
Despite the application of mitigating conditions F.20(c), F.20(d), and F.20(e), the clearance was denied. The judge found that the applicant failed to resolve significant mortgage debts totaling over $200,000 and multiple credit card debts. The applicant's strategic defaults were viewed as a lack of good-faith effort to repay creditors, and the financial difficulties were largely considered self-inflicted, failing to demonstrate responsible behavior.
Why the Applicant Was Denied
- The applicant failed to resolve significant mortgage debts totaling over $200,000 and multiple credit card debts.
- The applicant's strategic defaults on debts were viewed as a lack of good-faith effort to repay creditors.
- The applicant's financial difficulties were largely self-inflicted and did not demonstrate responsible behavior.
Conditions Referenced
- F.19(a)appliedInability or Unwillingness to Satisfy Debts
- F.19(c)appliedA History of Not Meeting Financial Obligations
- F.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 received some financial counseling through his attorney.
- F.20(d)rejectedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant's strategic defaults do not constitute good-faith efforts to repay creditors.
- F.20(e)rejectedThe Individual Has a Reasonable Basis to Dispute the Legitimacy of the Past-due DebtThe applicant's disputes regarding the debts were deemed premature.
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 issuedApr 20, 2015
- Answer filedMay 11, 2015
- Hearing heldSep 17, 2015
- Decision dateOct 21, 2015
Cite For
- Denial of Security Clearance Due to Unresolved Financial Obligations Under Guideline F
- Strategic Defaults as a Disqualifying Factor in Financial Considerations
- The Importance of Good-faith Efforts in Resolving Debts for Security Clearance Eligibility