As many doctors, lawyers, and others working in service industries can attest, unpaid bills take a significant bite out of profit. There is a legitimate need for debt collectors in the marketplace, and I don’t believe you can disparage an entire industry with one broad brush.

On the flip side, the debt collection industry’s image problem has been largely one of its own making. Anecdotal evidence shows that overly aggressive and/or illegal collection tactics continue to proliferate despite regulatory oversight; just Google “debt collector horror stories” for confirmation.

One of the more concerning tactics we’ve seen of late is debt collectors threatening to report security clearance holders to personnel security officials or military commanders. Under federal law, this is illegal – period. Nonetheless, many debtor-clearance holders are cowed into paying up, even if they have a legitimate, good-faith basis to dispute the debt’s validity.

What a Debt Collector Can – And Can’t – Do

To be clear, the law places strict limits on who debt collectors can contact and what they can say. Debt collectors are authorized only to contact other people to obtain information about your whereabouts and how to contact you. They cannot contact these people more than once and, most importantly, they cannot say they are trying to collect a debt.

The only people a debt collector can talk about your debts with are you, your spouse, a legal guardian (if you are incapacitated or a minor), or your attorney.  And if you have an attorney and you’ve placed your debtors on notice of that, debt collectors can only contact your attorney under most circumstances.

All of this is to say that security clearance holders who find themselves being threatened with loss of clearance and/or employment by a debt collector can and should fight back. The first step in doing so is to educate yourself more on the law. A good place to start for that is the U.S. Consumer Financial Protection Bureau’s “Ask CFPB” tool, which offers answers to hundreds of financial questions. You can access it online and for free here.

Next, if you believe you are the victim of illegal debt collection practices you should report the violation(s) to CFPB, your State Attorney General’s consumer protection unit, and – in particularly extreme instances involving harassment or extortion – local law enforcement. A paper trail will be critical to ultimately holding violators accountable.

Finally, do keep in mind that while a debt collector cannot report or threaten to report you to personnel security officials, your employer, or military commanders, you may be obligated to report yourself if you accrue significant delinquent debt. For more on your obligations there, check out Security Executive Agent Directive (SEAD)-3, issued by the Director of National Intelligence.


This article is intended as general information only and should not be construed as legal advice. Consult an attorney regarding your specific situation. 

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Sean M. Bigley retired from the practice of law in 2023, after a decade representing clients in the security clearance process. He was previously an investigator for the Defense Counterintelligence and Security Agency (then-U.S. Office of Personnel Management) and served from 2020-2024 as a presidentially-appointed member of the National Security Education Board. For security clearance assistance, readers may wish to consider Attorney John Berry, who is available to advise and represent clients in all phases of the security clearance process, including pre-application counseling, denials, revocations, and appeals. Mr. Berry can be found at