Summary
A 44-year-old former U.S. Army sergeant was denied a security clearance under Guideline F (Financial Considerations) due to a history of significant financial issues and a lack of demonstrated reform. The applicant's financial record included multiple bankruptcy filings and a military conviction for larceny and fraud.
Specifically, the applicant was found guilty by court-martial in November 1997 of Larceny of Government Funds, False Official Statements, and Fraud Against the United States, resulting in a Bad Conduct Discharge. Additionally, the applicant filed for Chapter 7 bankruptcy in February 1996, claiming approximately $62,516.91 in liabilities, which was discharged in June 1996.
Further financial difficulties led to a Chapter 13 bankruptcy petition in March 2002, claiming about $35,820 in liabilities, which was dismissed in May 2003. An additional Chapter 7 bankruptcy petition was filed in August 2002, claiming approximately $52,345 in liabilities, with dischargeable debts released in February 2004. The judge concluded that the applicant failed to establish a track record of financial reform or a willingness to satisfy debts, leading to the denial of the security clearance.
Why the Applicant Was Denied
- Applicant has a history of financial problems, including multiple bankruptcy filings.
- Applicant was found guilty of Larceny of Government Funds, False Official Statements, and Fraud Against the United States.
- Applicant failed to establish a track record of financial reform or a plan to manage debts.
Conditions Referenced
- E2.A6.1.2.1raisedA History of Not Meeting Financial Obligations.
- E2.A6.1.2.2raisedDeceptive or Illegal Financial Practices Such as Embezzlement, Employee Theft, Check Fraud, Income Tax Evasion, Expense Account Fraud, Filing Deceptive Loan Statements, and Other Intentional Financial Breaches of Trust.
- E2.A6.1.2.3raisedInability or Unwillingness to Satisfy Debts.
- E2.A6.1.3.1appliedThe Behavior Was Not Recent.
- E2.A6.1.3.2rejectedIt Was an Isolated Incident.
- E2.A6.1.3.4rejectedThe Conditions That Resulted in the Behavior Were Largely Beyond the Person's Control.
- E2.A6.1.3.6rejectedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve Debts.
Key Rule Quoted
“"A person who is unwilling to fulfill his legal obligations does not demonstrate the high degree of good judgment and reliability required of persons granted access to classified information."”
Procedural Posture
- SOR issuedJun 23, 2005
- Answer filedJul 13, 2005
- Hearing heldJan 30, 2006
- Decision dateJun 6, 2006
Cite For
- Denial of Clearance Due to Financial Irresponsibility Under Guideline F
- Impact of Criminal Conduct on Security Clearance Eligibility
- Lack of Demonstrated Financial Reform as a Basis for Clearance Denial