Summary
A 54-year-old electronic equipment technician and former Navy petty officer was denied a security clearance under Guideline F (Financial Considerations) due to a long history of financial instability. The applicant had filed five Chapter 13 bankruptcy petitions between 1995 and 2012. As of the Statement of Reasons, he owed $288,114 across 24 past-due or delinquent debts.
Specific issues included the dismissal of a November 2009 Chapter 13 petition in May 2011 and an August 2012 petition, both for failure to make required payments. Additionally, the applicant's home mortgage went into foreclosure, and he had unpaid taxes resulting from miscalculations on federal tax returns after his Navy retirement. While he was making monthly payments under his current Chapter 13 plan, this was deemed insufficient.
The denial was based on the applicant's extensive history of bankruptcy filings, which the judge viewed as his primary response to financial problems, rather than demonstrating good-faith efforts to repay debts. The judge concluded there was insufficient evidence of financial stability or a satisfactory payment track record, determining that granting a clearance was not consistent with national interest.
Why the Applicant Was Denied
- Applicant has a long history of multiple bankruptcy petitions, indicating unresolved financial issues.
- He failed to demonstrate a satisfactory track record of payments or financial stability.
- The judge found that bankruptcy was the applicant's primary response to financial problems, lacking evidence of good-faith efforts to repay debts.
Conditions Referenced
- AG ¶ 19(a)raisedInability or Unwillingness to Satisfy Debts
- AG ¶ 19(c)raisedA History of Not Meeting Financial Obligations
- AG ¶ 20(a)rejectedBehavior Happened so Long Ago, Was Infrequent, or Unlikely to RecurApplicant is still in bankruptcy and debts have not been resolved.
- AG ¶ 20(b)rejectedConditions That Resulted in Financial Problems Were Largely Beyond the Person's ControlFinancial problems pre-dated retirement and bankruptcy was the primary response.
- AG ¶ 20(c)rejectedReceived or Is Receiving Counseling for the ProblemApplicant did not seek professional financial counseling outside of bankruptcy.
- AG ¶ 20(d)rejectedInitiated a Good-faith Effort to Repay Overdue CreditorsApplicant forced creditors to comply with bankruptcy procedures rather than making direct efforts to resolve debts.
Key Rule Quoted
“A security clearance decision is intended only to resolve whether it is clearly consistent with the national interest for an applicant to either receive or continue to have access to classified information.”
Procedural Posture
- SOR issuedAug 17, 2015
- Answer filedSep 1, 2015
- Hearing heldFeb 10, 2016Applicant appeared pro se.
- Decision dateMay 23, 2016
Cite For
- Long History of Bankruptcy Filings as a Disqualifying Factor Under Guideline F
- Insufficient Evidence of Financial Stability as a Basis for Denial
- Failure to Demonstrate Good-faith Efforts to Resolve Debts in Bankruptcy Cases