ISCR Case 01-00977.h1

Case Headnote

ISCR Case No. 01-00977.h1

deniedOct 25, 2001· Hon. Claude R. Heiny II· hearing

Summary

A 47-year-old defense contractor was denied a secret security clearance due to concerns under Guideline E (Personal Conduct) and Guideline F (Financial Considerations). The denial stemmed from approximately $5,700 in unresolved debts across four accounts and the applicant's failure to disclose financial delinquencies on her Standard Form 86.

Specific financial issues included an outstanding computer account balance of approximately $2,246, a MasterCard debt of $1,152, and a Visa account with a judgment rendered against the applicant for $2,911.77 plus court costs and fees. Additionally, a $171 department store debt from 1993 remained unresolved. While a 1997 vacuum cleaner debt was paid through garnishment, and a repossessed truck was recovered after payments were brought current, these did not mitigate the overall financial picture. The applicant was also one month behind on her mortgage in August 2000, though payments are now current.

The judge found that the applicant's history of financial difficulties, dating back to 1996, combined with her failure to disclose delinquencies on her Standard Form 86, citing embarrassment, demonstrated a lack of candor and financial irresponsibility. The applicant provided no documentation to support claims of debt repayment or good faith efforts, leading to the denial of her security clearance.

Why the Applicant Was Denied

The Applicant has a history of financial difficulties dating back to 1996, with approximately $5,700 owed on four accounts.
The Applicant failed to disclose financial delinquencies of more than 180 days on her Standard Form 86, citing embarrassment as the reason for her omission.
The Applicant provided no documentation to support claims of having paid off debts or made good faith efforts to repay creditors.

Conditions Referenced

Disqualifying

E2.A6.1.2.1raisedA History of Not Meeting Financial Obligations.
E2.A6.1.2.3raisedInability or Unwillingness to Satisfy Debts.
E2.A5.1.2.2raisedThe Deliberate Omission, Concealment, or Falsification of Relevant and Material Facts.

Key Rule Quoted

“A person who seeks access to classified information enters into a fiduciary relationship with the Government predicated upon trust and confidence.”
— Department of Navy v. Egan, 484 U.S. 518, 531 (1988)

Procedural Posture

SOR issuedApr 24, 2001
Answer filedMay 23, 2001Applicant elected to have the case decided on the written record.
Hearing held—No hearing; case decided on the written record.
Decision dateOct 25, 2001

Cite For

Denial Based on Financial Irresponsibility Under Guideline F
Failure to Disclose Financial Delinquencies Under Guideline E
Importance of Candor in Security Clearance Applications

Editorial summary generated for research. Not legal advice; not a prediction. Verify against the full decision before relying on any quoted language.

¶	Allegation	Finding	Conduct	Concealed Issue	Response	Disqualifying (¶16)	Mitigating applied (¶17)	Mitigation
2.a	The deliberate omission, concealment, or falsification of relevant and material facts from any personnel security questionnaire, personal history statement, or similar form used to conduct investigations, determine employment qualifications, award benefits or status, determine security clearance eligibility or trustworthiness, or award fiduciary responsibilities.	Against Applicant	Omission or Failure to DiscloseFOUND DELIBERATE	Financial	Denied	—	—	—

Allegation

Finding

Conduct

Concealed Issue

Response

Disqualifying (¶16)

Mitigating applied (¶17)

Mitigation

2.a

The deliberate omission, concealment, or falsification of relevant and material facts from any personnel security questionnaire, personal history statement, or similar form used to conduct investigations, determine employment qualifications, award benefits or status, determine security clearance eligibility or trustworthiness, or award fiduciary responsibilities.

Against Applicant

Omission or Failure to DiscloseFOUND DELIBERATE

Financial

Denied

—

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	The Applicant owes approximately $2,246.00 on a computer account. The Applicant stated she had paid off this debt, but provided no receipts or documentation to support this claim. $2,246	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.b	The Applicant owes $1,152.00 on a MasterCard credit card account. The Applicant made one payment after the account was turned over to a collection agency and stated she would contact the company to arrange payment, but provided no receipts or documentation. $1,152	Against Applicant	Credit Card Debt	Admitted	—	—	—
1.c	The Applicant owes $2,430.00 on a Visa credit card account. A judgment was rendered against the Applicant for this account in the amount of $2,911.77 plus court costs and fees. The Applicant stated she would contact the company to arrange payment, but provided no receipts or documentation. $2,430	Against Applicant	Credit Card Debt	Admitted	—	—	—
1.d	The Applicant owes $171.00 to a department store for an account opened in 1993. The Applicant believes this account had been paid in full but has provided no receipts or documentation. $171	Against Applicant	Unspecified Financial	Denied	—	—	—
1.e	In 1997, a judgment was rendered against the Applicant concerning an unpaid debt for a vacuum cleaner. This account was paid in full through a garnishment action. $1,009	For Applicant	Judgment Against Applicant	Admitted	—	—	—
1.f	The Applicant's mortgage account was opened in 1994, and the Applicant was one month behind on her mortgage payment in August 2000. The mortgage payments are current now, and there is no indication the Applicant has ever been late on any other mortgage payment. $63,000	For Applicant	Mortgage or Home Loan Debt	Admitted	—	—	—
1.g	In January 2000, the Applicant's truck was repossessed when payments were two months late. The Applicant brought the payments current and recovered the truck.	For Applicant	Auto Loan Debt	Admitted	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

The Applicant owes approximately $2,246.00 on a computer account. The Applicant stated she had paid off this debt, but provided no receipts or documentation to support this claim.

$2,246

Against Applicant

Unspecified Financial

Admitted

—

1.b

The Applicant owes $1,152.00 on a MasterCard credit card account. The Applicant made one payment after the account was turned over to a collection agency and stated she would contact the company to arrange payment, but provided no receipts or documentation.

$1,152

Against Applicant

Credit Card Debt

Admitted

—

1.c

The Applicant owes $2,430.00 on a Visa credit card account. A judgment was rendered against the Applicant for this account in the amount of $2,911.77 plus court costs and fees. The Applicant stated she would contact the company to arrange payment, but provided no receipts or documentation.

$2,430

Against Applicant

Credit Card Debt

Admitted

—

1.d

The Applicant owes $171.00 to a department store for an account opened in 1993. The Applicant believes this account had been paid in full but has provided no receipts or documentation.

$171

Against Applicant

Unspecified Financial

Denied

—

1.e

In 1997, a judgment was rendered against the Applicant concerning an unpaid debt for a vacuum cleaner. This account was paid in full through a garnishment action.

$1,009

For Applicant

Judgment Against Applicant

Admitted

—

1.f

The Applicant's mortgage account was opened in 1994, and the Applicant was one month behind on her mortgage payment in August 2000. The mortgage payments are current now, and there is no indication the Applicant has ever been late on any other mortgage payment.

$63,000

For Applicant

Mortgage or Home Loan Debt

Admitted

—

1.g

In January 2000, the Applicant's truck was repossessed when payments were two months late. The Applicant brought the payments current and recovered the truck.

For Applicant

Auto Loan Debt

Admitted

—

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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

CONCLUSION

FORMAL FINDINGS

DECISION

APPEARANCES

STATEMENT OF CASE

FINDINGS OF FACT

POLICIES

CONCLUSION

DECISION

FOOTNOTES