ISCR Case 03-23776.h1

Case Headnote

ISCR Case No. 03-23776.h1

deniedDec 22, 2005· Hon. James A. Young· hearing

Summary

A 56-year-old classification management specialist was denied a security clearance under Guideline F (Financial Considerations) due to unresolved financial issues. These issues originated from debts incurred after his wife's job loss in 1996. The applicant failed to demonstrate sufficient financial responsibility and accountability for debts attributed to both him and his wife.

Specific allegations included two corporate credit card debts, one for $5,385 charged off in 1997 and paid in June 2004, and another for $869 charged off in 2001, for which the applicant received credit for payment without evidence. Two other debts, for $1,787 and $1,744, were asserted by the applicant to potentially belong to his wife; these were subsequently removed from his credit reports after inquiries. A $4,557 department store account, opened by his wife with the applicant as an authorized buyer, was charged off in 1998. A default judgment was entered against his wife for this debt in May 2003, which remains unpaid. Finally, an $826 debt to a collection agency was disputed by the applicant and removed from his credit report.

Despite some debt repayment and removal of certain debts from his credit reports, the applicant's security clearance was denied. The denial was based on a history of not meeting financial obligations, an inability or unwillingness to satisfy debts, and the continued existence of unpaid debts attributed to him, indicating a lack of fiscal responsibility.

Why the Applicant Was Denied

Applicant has a history of not meeting financial obligations.
Applicant is unable or unwilling to satisfy his debts.
Debts attributed to the applicant remain unpaid, indicating a lack of fiscal responsibility.

Conditions Referenced

Disqualifying

E2.A6.1.2.1raisedHistory of Not Meeting Financial Obligations
E2.A6.1.2.3raisedUnable or Unwilling to Satisfy Debts

Mitigating

E2.A6.1.3.1rejectedDebts Were Not RecentMost of the debts alleged as delinquent still have not been paid.
E2.A6.1.3.2rejectedIsolated IncidentDebts persist to this day and are not isolated.
E2.A6.1.3.3rejectedCondition Largely Beyond ControlFinancial difficulties were understandable but debts remain unpaid.
E2.A6.1.3.6appliedGood Faith Effort to Repay DebtsApplicant made some payments but only after being prompted by interrogatories.

Key Rule Quoted

“An applicant 'has the ultimate burden of demonstrating that it is clearly consistent with the national interest to grant or continue his security clearance.'”
— ISCR Case No. 01-20700 at 3.

Procedural Posture

SOR issuedFeb 11, 2005
Answer filedMar 11, 2005
Hearing heldSep 14, 2005
Decision dateDec 22, 2005

Cite For

Financial Responsibility Under Guideline F
Impact of Spouse's Debts on Applicant's Security Clearance
Burden of Proof in Security Clearance Cases

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

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Debt 1.a for $5,385 and Debt 1.e for $869 were from corporate credit cards issued to Applicant. The debt in 1.a appears to have been charged off in 1997 and the debt in 1.e was charged off in 2001. In June 2004, after Applicant had completed interrogatories from DOHA regarding his debts, Applicant paid off 1.a. The company appears to have given Applicant credit for paying 1.e, although there is no evidence to suggest he did. $5,385	Against Applicant	Credit Card Debt	Admitted	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.b	Debt 1.b for $1,787 and Debt 1.c for $1,744 were for separate accounts from the same creditor. Applicant asserts these debts may have belonged to his wife, and she acknowledged holding accounts with that creditor. He testified that he sent inquiries to the creditor that were never answered and the debts have subsequently been removed from his credit reports. $1,787	Against Applicant	Unspecified Financial	Denied	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.c	Debt 1.c for $1,744 was for a separate account from the same creditor as Debt 1.b. Applicant asserts these debts may have belonged to his wife, and she acknowledged holding accounts with that creditor. He testified that he sent inquiries to the creditor that were never answered and the debts have subsequently been removed from his credit reports. $1,744	Against Applicant	Unspecified Financial	Denied	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.d	Debt 1.d for $4,557 is for an account from a major department store that was opened by Applicant's wife. He was an authorized buyer. He admits it was possible that he used the account, but doesn't think he did. In July 1998, the account was charged off due to non-payment. In June 2002, the account was turned over to a collection firm that sued Applicant's wife. She failed to timely answer or appear and a default judgment was entered against her on 9 May 2003 for more than $3,300. The judgment remains unpaid. $4,557	Against Applicant	Judgment Against Applicant	Denied	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.e	Debt 1.e for $869 was from a corporate credit card issued to Applicant. The debt in 1.e was charged off in 2001. The company appears to have given Applicant credit for paying 1.e, although there is no evidence to suggest he did. $869	Against Applicant	Credit Card Debt	Denied	(b) unwillingness to satisfy debts regardless of ability (c) a history of not meeting financial obligations	—	—
1.f	Debt 1.f is for $826 owed to a collection agency. Applicant claims he has no knowledge of this debt. He disputed this debt and it was removed from his credit report. $826	For Applicant	Unspecified Financial	Denied	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Debt 1.a for $5,385 and Debt 1.e for $869 were from corporate credit cards issued to Applicant. The debt in 1.a appears to have been charged off in 1997 and the debt in 1.e was charged off in 2001. In June 2004, after Applicant had completed interrogatories from DOHA regarding his debts, Applicant paid off 1.a. The company appears to have given Applicant credit for paying 1.e, although there is no evidence to suggest he did.

$5,385

Against Applicant

Credit Card Debt

Admitted

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

—

1.b

Debt 1.b for $1,787 and Debt 1.c for $1,744 were for separate accounts from the same creditor. Applicant asserts these debts may have belonged to his wife, and she acknowledged holding accounts with that creditor. He testified that he sent inquiries to the creditor that were never answered and the debts have subsequently been removed from his credit reports.

$1,787

Against Applicant

Unspecified Financial

Denied

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

—

1.c

Debt 1.c for $1,744 was for a separate account from the same creditor as Debt 1.b. Applicant asserts these debts may have belonged to his wife, and she acknowledged holding accounts with that creditor. He testified that he sent inquiries to the creditor that were never answered and the debts have subsequently been removed from his credit reports.

$1,744

Against Applicant

Unspecified Financial

Denied

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

—

1.d

Debt 1.d for $4,557 is for an account from a major department store that was opened by Applicant's wife. He was an authorized buyer. He admits it was possible that he used the account, but doesn't think he did. In July 1998, the account was charged off due to non-payment. In June 2002, the account was turned over to a collection firm that sued Applicant's wife. She failed to timely answer or appear and a default judgment was entered against her on 9 May 2003 for more than $3,300. The judgment remains unpaid.

$4,557

Against Applicant

Judgment Against Applicant

Denied

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

—

1.e

Debt 1.e for $869 was from a corporate credit card issued to Applicant. The debt in 1.e was charged off in 2001. The company appears to have given Applicant credit for paying 1.e, although there is no evidence to suggest he did.

$869

Against Applicant

Credit Card Debt

Denied

(b) unwillingness to satisfy debts regardless of ability

(c) a history of not meeting financial obligations

—

1.f

Debt 1.f is for $826 owed to a collection agency. Applicant claims he has no knowledge of this debt. He disputed this debt and it was removed from his credit report.

$826

For Applicant

Unspecified Financial

Denied

—

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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

FOOTNOTES

APPEARANCES