ISCR Case 15-00209.h1

Case Headnote

ISCR Case No. 15-00209.h1

deniedMar 4, 2016· Hon. David M. White· hearing

Summary

A 37-year-old software engineer was denied a security clearance under Guideline F (Financial Considerations) due to significant unresolved financial issues. The Statement of Reasons detailed three primary allegations: a credit card account opened in February 2001 with a charged-off balance of $26,383, another credit card account opened in October 2000 with a charged-off balance of $6,819 that was later settled in full, and a home equity line of credit opened in August 2006 with a charged-off balance of $25,857. In total, these charged-off debts exceeded $59,000.

Disqualifying conditions under Guideline F were raised, specifically concerning a history of not meeting financial obligations and an inability or unwillingness to satisfy debts. While a mitigating condition related to the debt being resolved was applied to one account, it was insufficient to overcome the overall concerns.

The denial was based on the applicant's failure to adequately explain the origin of his debts, provide evidence of financial counseling, or present a clear plan for resolving his outstanding obligations. These factors led to substantial doubt regarding his reliability and trustworthiness, resulting in the denial of his security clearance.

Why the Applicant Was Denied

The applicant failed to demonstrate sufficient explanation for the origin of his debts.
He did not provide evidence of financial counseling or a plan to resolve his debts.
The applicant's financial issues raised substantial doubt about his reliability and trustworthiness.

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(d)appliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve DebtsThe applicant provided evidence that one debt was settled in full.

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 issuedAug 19, 2015
Answer filedSep 14, 2015Applicant requested a decision on the written record.
Hearing held—No hearing; decision made on the written record.
Decision dateMar 4, 2016

Cite For

Denial of Security Clearance Due to Significant Financial Issues Under Guideline F
Insufficient Evidence of Financial Responsibility Leading to Security Concerns
Impact of Financial Obligations on Reliability and Trustworthiness for Security Clearance

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	SOR ¶ 1.a concerns a credit card account with a major bank that Applicant opened in February 2001. The reported date of last activity on the account was August 2010, and it was charged off with balance due of $26,383. $26,383	Against Applicant	Credit Card Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.b	SOR ¶ 1.b concerns an account with a different major credit card company that Applicant opened in October 2000. The reported date of last activity on the account was March 2013, and it was charged off with a balance due of $6,819. Applicant received a letter from a law firm with whom the debt had been placed for collection, dated April 29, 2015, stating that this account had been 'settled in full.' $6,819	For Applicant	Credit Card Debt	Denied	—	(d) good-faith effort to repay or otherwise resolve debts	Claimed Debt Paid in Full
1.c	SOR ¶ 1.c concerns a home equity line of credit that Applicant opened in August 2006 with the lender holding the first mortgage on his home. The reported date of last activity on this account was March 2013, and it was charged off with a balance due of $25,857. $25,857	Against Applicant	Mortgage or Home Loan Debt	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

SOR ¶ 1.a concerns a credit card account with a major bank that Applicant opened in February 2001. The reported date of last activity on the account was August 2010, and it was charged off with balance due of $26,383.

$26,383

Against Applicant

Credit Card Debt

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

1.b

SOR ¶ 1.b concerns an account with a different major credit card company that Applicant opened in October 2000. The reported date of last activity on the account was March 2013, and it was charged off with a balance due of $6,819. Applicant received a letter from a law firm with whom the debt had been placed for collection, dated April 29, 2015, stating that this account had been 'settled in full.'

$6,819

For Applicant

Credit Card Debt

Denied

—

(d) good-faith effort to repay or otherwise resolve debts

Claimed

Debt Paid in Full

1.c

SOR ¶ 1.c concerns a home equity line of credit that Applicant opened in August 2006 with the lender holding the first mortgage on his home. The reported date of last activity on this account was March 2013, and it was charged off with a balance due of $25,857.

$25,857

Against Applicant

Mortgage or Home Loan Debt

Denied

(a) inability to satisfy debts

(c) a history of not meeting financial obligations

—

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Case Profile

Summary

Why the Applicant Was Denied

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 CONCEPT

FORMAL FINDINGS

CONCLUSION

FOOTNOTES