ISCR Case 04-10862.h1

Case Headnote

ISCR Case No. 04-10862.h1

grantedAug 9, 2006· Hon. Paul J. Mason· hearing

Summary

A 32-year-old defense contractor technician was granted a security clearance despite initial concerns under Guideline F (Financial Considerations) due to over $20,000 in alleged financial indebtedness. The Statement of Reasons detailed several debts, including a $9,509 auto loan from 1995 that became past due, and a $9,296 rental car liability from a 2000 collision, which the applicant settled. Other allegations included a disputed $2,658 debt that later disappeared from credit reports, and a $230 medical debt the applicant claimed to have paid but for which no documentation was provided.

The applicant demonstrated a good-faith effort to resolve his financial issues. He provided evidence of payments made on debts, and his July 2006 credit report confirmed that several debts had been settled or paid off since June 2005. This included the rental car liability, which was noted as "paid in full for less than the full balance."

The judge concluded that the applicant successfully mitigated the financial concerns. The applicant's actions, including settling a significant liability and providing payment evidence, along with his understanding of financial responsibility, indicated a reduced risk of future financial instability. Consequently, the security clearance was granted.

Why the Applicant Prevailed

The applicant provided evidence of payments made on debts, demonstrating a good-faith effort to resolve financial issues.
The applicant's credit report confirmed that several debts were settled or paid off since June 2005.
The applicant's understanding of the importance of financial responsibility indicated a reduced risk of future financial instability.

Conditions Referenced

Disqualifying

E2.A6.1.2.1raisedA History of Not Meeting Financial Obligations
E2.A6.1.2.3raisedInability or Unwillingness to Satisfy Debts

Mitigating

E2.A6.1.3.4appliedThe Person Has Received Counseling for the Problem and There Are Clear Indications That the Problem Is Being Resolved or Is Under Control
E2.A6.1.3.6appliedThe Individual Initiated a Good-faith Effort to Repay Overdue Creditors or Otherwise Resolve 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 issuedNov 23, 2005
Answer filedDec 27, 2005
Hearing held—Decision made on the record in lieu of a hearing.
Decision dateAug 9, 2006

Cite For

Good-faith Efforts to Resolve Financial Debts Under Guideline F
Mitigation of Financial Concerns Through Evidence of Payments
Consideration of the Whole Person Concept in Security Clearance Determinations

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	In August 1995, Applicant opened an installment account to purchase an auto. The account was to be paid off in 60 months through the auto credit company. For unknown reasons, the account became past due in the amount of 9,509.00. $9,509	For Applicant	Auto Loan Debt	Denied	—	(c) received/receiving counseling; problem being resolved	Claimed Debt Paid in Full
1.b	Subparagraph 1.b. involves a rented auto Applicant was driving when he collided with another auto in 2000. He is certain he filed a police report but the rent-a-car company maintains he did not, and is therefore liable. Rather than officially challenge his liability and possibly jeopardize his security clearance, Applicant settled the debt. His CBR dated July 2006 reflects the account ($9,296.00) was 'paid in full for less than the full balance.' $9,296	For Applicant	Unspecified Financial	Denied	—	(c) received/receiving counseling; problem being resolved	Claimed Debt Paid in Full
1.c	Applicant denies the 1.c. debt ($2,658.00). Though the debt appeared in Item 7 (CBR, June 2005), the debt no longer appears in Item 11 (CBR, June 2006) or Applicant's CBR dated July 2006 that he provided to the government to verify he had paid the overdue debts. $2,658	For Applicant	Unspecified Financial	Denied	—	—	—
1.d	Next, the SOR lists a $230.00 debt (1.d.) for medical services. In Item 6, Applicant stated he paid the debt in March 2005 but provided no documentation. Applicant reiterated his position in his July 2006 response to the FORM; the July 2006 CBR reflects he disputed this medical debt. $230	For Applicant	Medical Debt	Denied	—	(c) received/receiving counseling; problem being resolved	Claimed Debt Paid in Full
1.e	The sixth allegation is that based on a personal financial statement Applicant provided in June 2005, he has sufficient funds ($5,228.00) to make payments on the five delinquent debts. $5,228	For Applicant	Unspecified Financial	Admitted	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

In August 1995, Applicant opened an installment account to purchase an auto. The account was to be paid off in 60 months through the auto credit company. For unknown reasons, the account became past due in the amount of 9,509.00.

$9,509

For Applicant

Auto Loan Debt

Denied

—

(c) received/receiving counseling; problem being resolved

Claimed

Debt Paid in Full

1.b

Subparagraph 1.b. involves a rented auto Applicant was driving when he collided with another auto in 2000. He is certain he filed a police report but the rent-a-car company maintains he did not, and is therefore liable. Rather than officially challenge his liability and possibly jeopardize his security clearance, Applicant settled the debt. His CBR dated July 2006 reflects the account ($9,296.00) was 'paid in full for less than the full balance.'

$9,296

For Applicant

Unspecified Financial

Denied

—

(c) received/receiving counseling; problem being resolved

Claimed

Debt Paid in Full

1.c

Applicant denies the 1.c. debt ($2,658.00). Though the debt appeared in Item 7 (CBR, June 2005), the debt no longer appears in Item 11 (CBR, June 2006) or Applicant's CBR dated July 2006 that he provided to the government to verify he had paid the overdue debts.

$2,658

For Applicant

Unspecified Financial

Denied

—

1.d

Next, the SOR lists a $230.00 debt (1.d.) for medical services. In Item 6, Applicant stated he paid the debt in March 2005 but provided no documentation. Applicant reiterated his position in his July 2006 response to the FORM; the July 2006 CBR reflects he disputed this medical debt.

$230

For Applicant

Medical Debt

Denied

—

(c) received/receiving counseling; problem being resolved

Claimed

Debt Paid in Full

1.e

The sixth allegation is that based on a personal financial statement Applicant provided in June 2005, he has sufficient funds ($5,228.00) to make payments on the five delinquent debts.

$5,228

For Applicant

Unspecified Financial

Admitted

—

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Case Profile

Summary

Why the Applicant Prevailed

Conditions Referenced

Key Rule Quoted

Procedural Posture

Cite For

Full decision

DEFENSE OFFICE OF HEARINGS AND APPEALS

HEARING

APPEARANCES

FINDINGS OF FACT

POLICIES

CONCLUSION

FORMAL FINDINGS

DECISION

FOOTNOTES