Summary
A 46-year-old defense contractor employee was granted a security clearance despite initial concerns under Guideline F (Financial Considerations). The Statement of Reasons detailed a history of financial issues, including failure to file and pay federal income taxes for 1990 and 1991, and owing more taxes than withheld during that period.
Specific debts included $2,501 to Creditor #1, which has since been paid, and $150 to Creditor #2 for a loan to his wife, charged off in May 1992. He also owed Creditor #3, a credit union, $5,905 for a 1992 car and signature loan, and over $2,000 for a judgment to Creditor #4 from a 1992 loan. A $272 debt with Creditor #5, initially disputed, resulted in a judgment in November 1993. The applicant filed for Chapter 13 bankruptcy in 1992 and had multiple arrests between 1984 and 1991 for writing worthless or fraudulent checks, all of which were resolved.
The judge found that the applicant had made a good-faith effort to repay overdue creditors and resolve debts, having paid off four creditors in full and making timely payments on the remaining debt. A financial expert testified to his favorable financial position and acceptable credit risk. Given that the financial problems were not recent and significant mitigation steps were taken, the security clearance was granted.
Why the Applicant Prevailed
- The applicant initiated a good-faith effort to repay overdue creditors and resolve debts.
- He has paid off four creditors in full and is making timely payments on the remaining debt.
- The applicant's financial expert testified that he is in a favorable financial position and is an acceptable credit risk.
Conditions Referenced
- F1raisedHistory of Not Meeting Financial Obligations
- F3raisedInability or Unwillingness to Satisfy Debts
- F1appliedThe Behavior Was Not Recent
- F4appliedThe Person Has Received or Is Receiving Counseling for the Problem and There Are Clear Indications That the Problem Is Being Resolved or Is Under Control
- F6appliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve Debts
Key Rule Quoted
“The responsibility for producing evidence initially falls on the Government to demonstrate that it is not clearly consistent with the national interest to grant or continue Applicant's access to classified information.”
Procedural Posture
- SOR issuedDec 15, 2000
- Answer filedJan 11, 2001Amended on January 19, 2001.
- Hearing heldMay 7, 2001Hearing rescheduled due to scheduling difficulties.
- Decision dateJul 9, 2001
Cite For
- Mitigation of Financial Issues Under Guideline F
- Good Faith Efforts to Resolve Debts
- Consideration of Expert Testimony in Financial Matters