The security clearance process operates off of the whole person concept. And it never ceases to amaze me what ‘whole person’ arrives in front of an appeals judge at a Defense Office of Hearings and Appeals (DOHA) case. A recent case brought before DOHA was for an applicant in his 60s who held a security clearance for approximately 15 years. He received a Statement of Reasons under Guideline F, financial considerations, for significant debt and loans including $94,000 in charged off debts.
True or False: If the Statute of Limitations on a Debt Collection Has Passed, You don’t Need to Worry About It
We frequently discuss how it’s the cause of the debt that’s the broader issue, not necessarily the amount. But in this case, the clearance holder’s reasons for incurring the debt may be worse than giving no reasons. He and his wife simply racked up a great deal of consumer debt and loans, noting increased financial obligations when the applicant’s son and family moved in. This is obviously an attempt to create a relational motivation for high consumer spending. Unfortunately, the blame the son game doesn’t work when you actually have the assets to pay.
In this case, the applicant had $500,000 in a 401k along with approximately $300,000 in company stock. That’s along with approximately $500,000 in home equity. The applicant could have taken steps to pull money from any of these resources to pay his consumer debts. Instead, he hired a credit counselor who advised him to stop paying on the accounts so settlements could be reached. This is when it’s worth noting that if you consult a credit counselor to address financial issues, you may also want to consult a security clearance attorney or consultant. Or, at a bare minimum, find a credit counselor with national security experience who realizes it’s not just important that you get rid of your debt – but that you keep your clearance, as well.
Throughout the process, it appears the clearance holder was more concerned with getting rid of the debts than paying them, despite the assets at his disposal. Facts aside, security clearance appeals can only be made based on a brief number of issues, generally related to due process. The applicant argued several due process violations, including “asserts Department Counsel “used [her] expert knowledge against [him.]”
The court emphasized that was not an appealable issue, and the prehearing guidance notes that the process is adversarial.
False: Debt Obligation Matters, Not Just Debt
The clearance holder argued he was exercising his ‘consumer rights’ and noted the statute of limitations had passed for some debts. But the clearance process is not a financial obligations issue, it’s a reliability or trustworthiness issue. If you look for a way to skirt the rules and get out of your debt, don’t expect the government to continue to trust you with classified information. And if you want to list your new boomerang kid as a financial liability, you’d better not have the resources to pay your debts available – and simply left in tact.
