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ISCR Case 04-09114.h1 — CASE

ISCR Case 04-09114.h1denied

Case Headnote

ISCR Case No. 04-09114.h1

deniedJul 17, 2006· Hon. Barry M. Sax· hearing

Summary

The applicant, a 48-year-old employee of a defense contractor, faced issues under Guideline F due to a long history of delinquent debts, primarily tax-related, with inadequate mitigation efforts. The judge concluded that the applicant's financial issues raised significant concerns about his reliability and trustworthiness, resulting in a denial of the security clearance.

Under Guideline F (Financial Considerations), the Statement of Reasons alleged the following: Creditor A (judgment) $2,284.00, but Applicant has documented that this debt has been satisfied (1.a). Medical Debt B (collection) $156.00 (1.b). Medical Debt C (collection) $472.00 (1.c). State D (judgment for tax lien) (tax year 1983) $753.00 (1.d). Internal Revenue Service (IRS) (Tax Lien for 1984 and 1985) $12,342.64 (1.e). IRS (1994) $5,571.64 (1.f). State Tax Agency G $808.84 (1.g). IRS (Tax Lien for 1995) $4,391.91 (1.h). IRS (Tax lien for 1996) $6,666.23 (1.i). State Tax Agency J (1996) $1,852.68 (1.j). IRS (Tax lien for 1997) $2,861.05 (1.k). State Tax Agency (1997) $893.41 (1.l). IRS (1998) $3,243.50 (1.m). IRS (2003) $99.31 (1.n). IRS (unpaid federal taxes) $114,346.39 (1.o).

The judge denied the clearance. The government raised disqualifying conditions F1, F3. The decision turned on the following: The applicant has a long history of delinquent debts dating back to 1985, with many remaining unresolved; The applicant failed to demonstrate substantial actions taken to resolve his significant financial obligations; The applicant's financial overextension raised concerns about his integrity and potential for engaging in illegal acts.

Why the Applicant Was Denied

The applicant has a long history of delinquent debts dating back to 1985, with many remaining unresolved.
The applicant failed to demonstrate substantial actions taken to resolve his significant financial obligations.
The applicant's financial overextension raised concerns about his integrity and potential for engaging in illegal acts.

Conditions Referenced

Disqualifying

F1raisedA History of Not Meeting Financial Obligations
F3raisedInability or Unwillingness to Satisfy Debts

Key Rule Quoted

“A person seeking access to classified information enters into a fiduciary relationship with the Government based upon trust and confidence.”

Procedural Posture

SOR issuedSep 13, 2005
Answer filedOct 7, 2005
Hearing heldMar 22, 2006
Decision dateJul 17, 2006

Cite For

Denial Based on Unresolved Financial Obligations Under Guideline F
Importance of Demonstrating Financial Rehabilitation
Impact of Long-standing Debts on Security Clearance Eligibility

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

Standardized Decision Profile

SEAD-4 Guideline F · descriptive summary of a decided case

Posture: Decision on RecordDecided: denied

The judge found multiple financial concerns under Guideline F, including a history of unpaid debts and tax liens. While some debts were resolved, the majority remained outstanding, leading to a denial of the security clearance.

¶	Allegation	Finding	Type	Response	Disqualifying (¶19)	Mitigating applied (¶20)	Mitigation
1.a	Creditor A (judgment) $2,284.00, but Applicant has documented that this debt has been satisfied $2,284	For Applicant	Judgment Against Applicant	Admitted	—	—	Documented Debt Paid in Full
1.b	Medical Debt B (collection) $156.00. $156	For Applicant	Medical Debt	Denied	—	—	Documented Debt Paid in Full
1.c	Medical Debt C (collection) $472.00. $472	For Applicant	Medical Debt	Denied	—	—	Documented Debt Paid in Full
1.d	State D (judgment for tax lien) (tax year 1983) $753.00. $753	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.e	Internal Revenue Service (IRS) (Tax Lien for 1984 and 1985) $12,342.64. $12,342	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.f	IRS (1994) $5,571.64. $5,571	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.g	State Tax Agency G $808.84. $808	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.h	IRS (Tax Lien for 1995) $4,391.91. $4,391	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.i	IRS (Tax lien for 1996) $6,666.23. $6,666	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.j	State Tax Agency J (1996) $1,852.68. $1,852	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.k	IRS (Tax lien for 1997) $2,861.05. $2,861	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.l	State Tax Agency (1997) $893.41. $893	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.m	IRS (1998) $3,243.50. $3,243	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.n	IRS (2003) $99.31. $99	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—
1.o	IRS (unpaid federal taxes) $114,346.39. $114,346	Against Applicant	Tax Unpaid	Denied	(a) inability to satisfy debts (c) a history of not meeting financial obligations	—	—

Descriptive standardized rendering of a decided public case (Guideline F). The verbatim source decision is shown in full below.

Full decision

The complete, official text — footnotes and signatures included — is in the original PDF.

Decision text, by section

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

APPEARANCES

DATE: July 17, 2006

In Re:

------------------------

SSN: -----------------

Applicant for Security Clearance

CR Case No. 04-09114

DECISION OF ADMINISTRATIVE JUDGE

SYNOPSIS

This 48-year-old employee of a defense contractor has a history of tax and consumer delinquent debt going back to 1985, only a few of which have been resolved. Mitigation has not been adequately established. Clearance is denied.

STATEMENT OF CASE

On September 13, 2005, the Defense Office of Hearings and Appeals (DOHA), pursuant to Executive Order 10865 and Department of Defense Directive 5220.6 (Directive), dated January 2, 1992, as amended, issued a Statement of Reasons (SOR) to the Applicant. The SOR detailed reasons why DOHA could not make the preliminary affirmative finding required under the Directive that it is clearly consistent with the national interest to grant or continue a security clearance for the Applicant. The SOR recommended referral to an Administrative Judge to conduct proceedings and determine whether a clearance should be granted, denied or revoked.

On October 7, 2005, Applicant responded to the allegations set forth in the SOR, and elected to have a decision made by a DOHA Administrative Judge after a hearing. The case was assigned to me on February 8, 2006. A Notice of Hearing was issued on February 16, 2006, setting the hearing for March 22, 2006. At the hearing, the Government offered twelve (12) exhibits (Government's Exhibits (GX) 1-12 Applicant testified and offered four (4) exhibits (Applicant's Exhibits (AX) A-D. He also submitted a timely post hearing collection of documents, which was marked as AX AA - AX GG). All exhibits were admitted without objection. The transcript was received at DOHA on March 30, 2006.

FINDINGS OF FACT

Applicant is a 48-year-old employee of a defense contractor. The SOR contains fifteen (15) allegations under Guideline F (Financial). Applicant denies all of the allegations.

After considering the totality of the evidence, I make the following additional FINDINGS OF FACT as to the status of each SOR allegation.

Guideline F (Financial) As of the issuance of the SOR, and unless otherwise noted, Applicant had a history of 13 past due debts (delinquent, charged off, referred for collection, lien filed, or reduced to judgment) to the following creditors in the approximate amounts cited:

1.a. Creditor A (judgment) ------------------------------------------------------------- $2,284.00, but Applicant has documented that this debt has been satisfied (Response to SOR and AX A).

1.b. Medical Debt B (collection) ---------------------------------------------------------$156.00.

In his Response of October 7, 2006, Applicant states he has disputed this debt, but intends to pay it to resolve the issue.

1.c. Medical Debt C (collection) ----------------------------------------------------------$472.00.

In his Response of October 7, 2006, Applicant states he has disputed this debt, but intends to pay it to resolve the issue.

1.d. State D (judgment for tax lien) (tax year 1983)---------------------------------------$753.00.

1.e. Internal Revenue Service (IRS) (Tax Lien for 1984 and 1985) -------------$12,342.64.