Summary
The applicant, a 40-year-old employee of a federal contractor, faced security concerns under Guideline F due to financial difficulties stemming from unemployment and personal circumstances. She successfully resolved 9 out of 10 debts and demonstrated a commitment to managing her finances, leading to the granting of her security clearance.
Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: ($118,611) Applicant and her first husband purchased this home in 2004 and lived in it until 2010. The house foreclosure proceedings started in 2013 and were completed in August 2015. The proceeds of the foreclosure sale were sufficient to settle the mortgage deficiency balance (1.a). ($34,983 – the SOR alleged a charged-off second mortgage owing $45,803. The correct balance is $34,983. This was a second mortgage on the home alleged in SOR ¶ 1.a for a loan to build a swimming pool and fence. They are attempting to negotiate a settlement and they are disputing what they believed are overcharges (1.b). ($16,979 – the SOR alleged a delinquent mortgage. This mortgage was for a property Applicant’s father purchased. When he died in 2006, Applicant inherited his estate and assumed the delinquent mortgage as well as about $50,000 in credit card debt, and delinquent taxes owed to the IRS ($12,000). The credit grantor reclaimed the property and the mortgage was settled (1.c). ($5,832) Applicant submitted documentary evidence showing the account was paid (1.d). ($350) This was a debt for unpaid telephone services. Applicant submitted documentary evidence showing the account was paid (1.e). ($288) Applicant successfully disputed these debts and they were removed from her credit reports (1.f). ($204) Applicant successfully disputed these debts and they were removed from her credit reports (1.g). ($201) Applicant successfully disputed these debts and they were removed from her credit reports (1.h). ($6,128) Applicant submitted documentary evidence showing the account was paid (1.i). ($50) This was a debt for unpaid medical services. Applicant testified that she paid it (1.j).
The judge granted the clearance. The government raised disqualifying conditions AG ¶ 19(a), AG ¶ 19(c). The judge applied mitigating conditions AG ¶ 20(b), AG ¶ 20(d), AG ¶ 20(c). The decision turned on the following: Applicant resolved 9 of the 10 debts listed in the SOR; She established a track record of debt payment and resolution; Her financial problems were caused by circumstances beyond her control.
Why the Applicant Prevailed
- Applicant resolved 9 of the 10 debts listed in the SOR.
- She established a track record of debt payment and resolution.
- Her financial problems were caused by circumstances beyond her control.
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(d)appliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve Debts
- AG ¶ 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 Control
Key Rule Quoted
“The concept of meaningful track record necessarily includes evidence of actual debt reduction through payment of debts.”
Procedural Posture
- SOR issuedAug 13, 2015
- Answer filedSep 9, 2015
- Hearing heldJan 13, 2016
- Decision dateMay 31, 2016
Cite For
- Mitigation of Financial Considerations Under Guideline F
- Demonstrating a Meaningful Track Record of Debt Repayment
- Impact of Personal Circumstances on Financial Stability