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Case Headnote

ISCR Case No. 96-0454.h1

deniedNov 19, 1996· Hon. Michael Kirkpatrick· hearing

Summary

A 26-year-old defense contractor employee was denied a security clearance under Guideline F (Financial Considerations) due to a significant history of financial irresponsibility. The applicant had multiple unpaid debts totaling over $11,000, stemming from various credit card accounts, student loans, and non-sufficient funds checks.

Specific allegations included debts to Creditor A for approximately $1,675, Creditor B for approximately $1,105 and $2,046, Creditor C for approximately $437.82, Creditor D for approximately $105, Creditor E for approximately $163, and Creditor K for approximately $787. Additionally, the applicant owed Creditor F approximately $1,226 and $2,736 for student loans, Creditor G approximately $52 and $75 for non-sufficient funds checks, Creditor H approximately $27.13, Creditor I approximately $56.34, and Creditor J approximately $28.86 and $544 for telephone company debts.

Despite filing for Chapter 7 bankruptcy, the applicant failed to provide sufficient evidence that these debts were discharged or that she had made efforts toward repayment. This lack of evidence and the extensive history of unpaid obligations led to concerns about her judgment and reliability, resulting in the denial of her security clearance.

Why the Applicant Was Denied

The applicant has a history of not meeting financial obligations, with debts exceeding $11,000.
The applicant did not provide evidence that her debts were discharged in bankruptcy or that she made efforts to repay them.
The applicant's financial irresponsibility demonstrated poor judgment and unreliability, critical for holding a security clearance.

Conditions Referenced

Disqualifying

F.1raisedA History of Not Meeting Financial Obligations
F.3raisedInability or Unwillingness to Satisfy Debts

Key Rule Quoted

“The adjudication process is the careful weighing of a number of variables known as the whole person concept.”

Procedural Posture

SOR issuedJun 19, 1996
Answer filedJul 8, 1996Applicant elected for a written record determination.
Hearing held—No hearing; case determined on written record.
Decision dateNov 19, 1996

Cite For

Denial Based on Financial Irresponsibility Under Guideline F
Impact of Bankruptcy Filing on Security Clearance Eligibility
Importance of Demonstrating Financial Rehabilitation for Clearance Approval

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	Applicant is indebted to Creditor A (credit card company), in the amount of approximately $1,675.00, for a credit card account opened in December of 1988 and closed in May of 1989 for non-payment. $1,675	Against Applicant	Credit Card Debt	Admitted	—	—	—
1.b	Applicant is indebted to Creditor B (credit card bank), in the amount of approximately $1,105.00, for a ---- credit card account opened in January of 1989 and closed due to non-payment in January of 1990. $1,105	Against Applicant	Credit Card Debt	Admitted	—	—	—
1.c	Applicant is indebted to Creditor B, in the sum of approximately $2,046.00, for a ---------- credit card account opened in March of 1990 and closed due to non-payment in November of 1990. $2,046	Against Applicant	Credit Card Debt	Admitted	—	—	—
1.d	Applicant is indebted to Creditor C (collection agency), in the amount of approximately $437.82, for a ---- credit card account opened with a credit card bank in October of 1994, and assigned to Creditor C for collection by that credit card bank in December of 1995. $437	Against Applicant	Credit Card Debt	Admitted	—	—	—
1.e	Applicant is indebted to Creditor D (department store), in the amount of approximately $105.00, for a credit card account opened in May of 1990 and closed due to non-payment in March of 1991. $105	Against Applicant	Credit Card Debt	Admitted	—	—	—
1.f	Applicant is indebted to Creditor E (department store), in the amount of approximately $163.00, for a credit account opened in May of 1990 and closed due to non-payment in May of 1991. $163	Against Applicant	Credit Card Debt	Admitted	—	—	—
1.g	Applicant is indebted to Creditor F (a government agency which is guarantor of student loans) in the approximate amounts of $1,226.00 and $2,736.00, for student loans obtained from a credit union in November of 1988 and assigned to the government agency for collection in May of 1993 due to non-payment. $1,226	Against Applicant	Student Loan Debt	Admitted	—	—	—
1.h	Applicant is indebted to Creditor F in the approximate amounts of $1,226.00 and $2,736.00, for student loans obtained from a credit union in November of 1988 and assigned to the government agency for collection in May of 1993 due to non-payment. $2,736	Against Applicant	Student Loan Debt	Admitted	—	—	—
1.i	Applicant is indebted to Creditor G (collection agency), in the amounts of approximately $52.00 and $75.00, for non-sufficient funds checks written in June of 1990 and March of 1992. $52	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.j	Applicant is indebted to Creditor G in the amounts of approximately $52.00 and $75.00, for non-sufficient funds checks written in June of 1990 and March of 1992. $75	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.k	Applicant is indebted to Creditor H (collection agency), in the approximate amount of $27.13, for a non-sufficient funds check written in December of 1990. $27	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.l	Applicant is indebted to Creditor I (collection agency), in the approximate amount of $56.34, for a non-sufficient funds check written to a discount store as payee in September of 1989, and assigned to the collection agency for collection in October of 1991. $56	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.m	Applicant is indebted to Creditor J (collection agency), in the approximate amounts of $28.86 and $544.00, for debts owed to a telephone company and assigned to the collection agency for collection in February and April of 1990. $28	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.n	Applicant is indebted to Creditor J in the approximate amounts of $28.86 and $544.00, for debts owed to a telephone company and assigned to the collection agency for collection in February and April of 1990. $544	Against Applicant	Unspecified Financial	Admitted	—	—	—
1.o	Applicant is indebted to Creditor K (credit card bank), in the approximate amount of $787.00, for an unpaid credit card account opened in May of 1989 and closed in June of 1989. $787	Against Applicant	Credit Card Debt	Admitted	—	—	—

Allegation

Finding

Type

Response

Disqualifying (¶19)

Mitigating applied (¶20)

Mitigation

1.a

Applicant is indebted to Creditor A (credit card company), in the amount of approximately $1,675.00, for a credit card account opened in December of 1988 and closed in May of 1989 for non-payment.

$1,675

Against Applicant

Credit Card Debt

Admitted

—

1.b

Applicant is indebted to Creditor B (credit card bank), in the amount of approximately $1,105.00, for a ---- credit card account opened in January of 1989 and closed due to non-payment in January of 1990.

$1,105

Against Applicant

Credit Card Debt

Admitted

—

1.c

Applicant is indebted to Creditor B, in the sum of approximately $2,046.00, for a ---------- credit card account opened in March of 1990 and closed due to non-payment in November of 1990.

$2,046

Against Applicant

Credit Card Debt

Admitted

—

1.d

Applicant is indebted to Creditor C (collection agency), in the amount of approximately $437.82, for a ---- credit card account opened with a credit card bank in October of 1994, and assigned to Creditor C for collection by that credit card bank in December of 1995.

$437

Against Applicant

Credit Card Debt

Admitted

—

1.e

Applicant is indebted to Creditor D (department store), in the amount of approximately $105.00, for a credit card account opened in May of 1990 and closed due to non-payment in March of 1991.

$105

Against Applicant

Credit Card Debt

Admitted

—

1.f

Applicant is indebted to Creditor E (department store), in the amount of approximately $163.00, for a credit account opened in May of 1990 and closed due to non-payment in May of 1991.

$163

Against Applicant

Credit Card Debt

Admitted

—

1.g

Applicant is indebted to Creditor F (a government agency which is guarantor of student loans) in the approximate amounts of $1,226.00 and $2,736.00, for student loans obtained from a credit union in November of 1988 and assigned to the government agency for collection in May of 1993 due to non-payment.

$1,226

Against Applicant

Student Loan Debt

Admitted

—

1.h

Applicant is indebted to Creditor F in the approximate amounts of $1,226.00 and $2,736.00, for student loans obtained from a credit union in November of 1988 and assigned to the government agency for collection in May of 1993 due to non-payment.

$2,736

Against Applicant

Student Loan Debt

Admitted

—

1.i

Applicant is indebted to Creditor G (collection agency), in the amounts of approximately $52.00 and $75.00, for non-sufficient funds checks written in June of 1990 and March of 1992.

$52

Against Applicant

Unspecified Financial

Admitted

—

1.j

Applicant is indebted to Creditor G in the amounts of approximately $52.00 and $75.00, for non-sufficient funds checks written in June of 1990 and March of 1992.

$75

Against Applicant

Unspecified Financial

Admitted

—

1.k

Applicant is indebted to Creditor H (collection agency), in the approximate amount of $27.13, for a non-sufficient funds check written in December of 1990.

$27

Against Applicant

Unspecified Financial

Admitted

—

1.l

Applicant is indebted to Creditor I (collection agency), in the approximate amount of $56.34, for a non-sufficient funds check written to a discount store as payee in September of 1989, and assigned to the collection agency for collection in October of 1991.

$56

Against Applicant

Unspecified Financial

Admitted

—

1.m

Applicant is indebted to Creditor J (collection agency), in the approximate amounts of $28.86 and $544.00, for debts owed to a telephone company and assigned to the collection agency for collection in February and April of 1990.

$28

Against Applicant

Unspecified Financial

Admitted

—

1.n

Applicant is indebted to Creditor J in the approximate amounts of $28.86 and $544.00, for debts owed to a telephone company and assigned to the collection agency for collection in February and April of 1990.

$544

Against Applicant

Unspecified Financial

Admitted

—

1.o

Applicant is indebted to Creditor K (credit card bank), in the approximate amount of $787.00, for an unpaid credit card account opened in May of 1989 and closed in June of 1989.

$787

Against Applicant

Credit Card Debt

Admitted

—

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Summary

Why the Applicant Was Denied

Conditions Referenced

Key Rule Quoted

Procedural Posture

Cite For

Full decision