Summary
The Applicant, a 41-year-old defense contractor with three years of college, faced financial difficulties due to medical emergencies and loss of employment, resulting in approximately $26,400 in past due debts. He has since addressed all debts, secured additional employment, and demonstrated a positive cash flow, leading to the granting of his security clearance under Guideline F.
Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: The Applicant owed about $10,000 in past due indebtedness on student loans (1.a). The Applicant owes about $1,063 to a financial institution (1.b). The Applicant owes about $3,924 to another financial institution (1.d). The Applicant owes about $5,440 to a bank (1.e). The Applicant owes about $2,563 to another bank (1.f). The Applicant owes about $1,145 to a third financial institution (1.h). The Applicant owed about $84 to a fourth financial institution (1.i). The Applicant owes about $203 to a fifth financial institution (1.j). The Applicant owed about $1,501 to the Internal Revenue Service (IRS) (1.k). The Applicant owed about $480 to his state's income taxing authority (1.l).
The judge granted the clearance. The government raised disqualifying conditions F.1, F.3. The judge applied mitigating conditions F.3, F.6. The decision turned on the following: The Applicant's financial difficulties were caused by conditions beyond his control, including medical emergencies and loss of employment; He has addressed all past due indebtedness and has a positive monthly cash flow of over $400; The Applicant's efforts to repay debts and his current financial stability mitigated the concerns raised by the Government.
Why the Applicant Prevailed
- The Applicant's financial difficulties were caused by conditions beyond his control, including medical emergencies and loss of employment.
- He has addressed all past due indebtedness and has a positive monthly cash flow of over $400.
- The Applicant's efforts to repay debts and his current financial stability mitigated the concerns raised by the Government.
Conditions Referenced
- F.1raisedA History of Not Meeting Financial Obligations
- F.3raisedInability or Unwillingness to Satisfy Debts
- F.3appliedThe Conditions That Resulted in the Behavior Were Largely Beyond the Person's Control (e.g., Loss of Employment, Unexpected Medical Emergency)
- F.6appliedThe Individual Initiated a Good Faith Effort to Repay Overdue Creditors or Otherwise Resolved Debts
Key Rule Quoted
“An individual who is financially overextended is at risk of having to engage in illegal acts to generate funds.”
Procedural Posture
- SOR issuedJul 30, 2002
- Answer filedSep 2, 2002
- Hearing heldJan 7, 2003
- Decision dateFeb 12, 2003
Cite For
- Mitigating Conditions Under Guideline F Related to Financial Difficulties Caused by Uncontrollable Circumstances
- Demonstrating Good Faith Efforts to Resolve Financial Obligations
- Positive Cash Flow as a Factor in Mitigating Financial Concerns