Security Clearance Jobs Blog

At first, it looked like 62 workers at Defense Finance and Accounting Service (DFAS)’s military payroll accounting facility in Cleveland, Ohio would lose their jobs due to credit problems. In the past, other DFAS workers in Columbus and Indianapolis had lost jobs because of credit issues.  The Cleveland facility processes pay for active Navy personnel, military retirees, and government officials, including the President.

After some lobbying by local members of Congress, an article in The Plain Dealer explains what happened next…

“The Defense Finance and Accounting Service has agreed to suspend a controversial policy of firing workers for credit reasons while it reviews whether it was necessary to upgrade their security clearances in 2005. The announcement gives a temporary reprieve to 47 workers who were about to lose their jobs.”

“DFAS spokesman Tom LaRock said that since 2001, 54 employees from all DFAS offices have been terminated for not being able to obtain a favorable background clearance…All DFAS positions are classified as sensitive, LaRock said. Because they process people’s pay, employees have access to social security numbers, bank accounts and other sensitive information, he said.”

“It is not top secret or confidential,” he said. “It is considered a background clearance.”

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Amid growing unemployment, foreclosure and delinquency rates are spiking.  We thought it would be a good time to revisit how a person’s personal financial situation can affect their  security clearance.

A sampling of Defense Office of Hearing and Appeals (DOHA) security clearance hearings showed (in 2007, just when the recession was taking hold) that about 50% of clearance denials involved “Financial Considerations”

Since delinquent debt is by far the most common financial concern, we published several articles on this very topic entitled; The Impact of Delinquent Debt on Security Clearances, What To Do If You Have Delinquent Debt, Explaining Delinquent Debt on the SF-86, Delinquent Debt and Interim Clearance, as well as several blog posts.

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What should you do…

1. Start correcting the problem immediately, document all efforts, and keep a chronology of activities.

2. Get credit reports from all three national credit reporting companies and use the reports to make a list of all your creditors, but understand its limits. Things that sometimes don’t show up on a credit report including unpaid alimony, tax delinquencies, automobile leases, and some other debts. Occasionally erroneous and duplicate information appears on a report. Although the clearance application form (SF86) only asks for 7 year’s worth of financial information; adjudicators may consider all financial information available to them, including financial information collected by field investigators from court records, rental/utility records, personal references, real estate records, and employment records that does not appear on a credit report.

3. Immediately take action to dispute any erroneous information on the credit report.

4. Make at least minimum regular monthly payments to all creditors.

5. Contact those creditors that have unpaid claims against you, insure that the claims are legitimate, and set up a repayment schedule as soon as possible. Try to communicate in writing and keep copies of all correspondence. If you communicate by telephone, make a written record of the telephone call and include the date, name of the person you spoke to, and a gist of the conversation.

6. Seek credit counseling if necessary, preferably with organizations that is a member of the National Foundation for Credit Counseling. They may be able to negotiate better repayment terms and lower interest rates than you are able to obtain by yourself.

7. Don’t be afraid of bankruptcy, if your situation warrants it. If you seek the services of a reputable credit counseling service first, they will advise you whether your situation can be resolved better through bankruptcy or debt consolidation.

William H. Henderson is a retired security investigator, author of Security Clearance Manual, and regular contributor to ClearanceJobsBlog.com and ClearanceJobs.com.

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With the economic downturn and entering the seventh year of overseas combat, some Soldiers and civilians are worried about their security clearance.

The commander of the U.S. Army Central Personnel Security Clearance Facility (CCF) wants all Army personnel to understand that “they can obtain counseling services for financial and mental health issues without undue concern of placing their security clearance status in jeopardy…”

As previously mentioned on ClearanceJobsBlog, a bankruptcy or foreclosure will not automatically prevent one from obtaining or maintaining a security clearance. There are many conditions surrounding financial hardships that often mitigate security concerns.

In fact, about 98 percent of cases received by the CCF which involve financial issues were granted a security clearance. This trend has been consistent since 2005.  Individuals under financial duress are encouraged to contact their local Army Community Service or Military One Source to obtain financial counseling to determine how to best manage their debts.

Many Soldiers expressed an unwillingness to participate in behavioral or psychological health programs, however the OPM ensures that investigations are conducted in a manner compliant with the revised Q21, which excludes the reporting of treatment related to adjustments from service in a military combat environment, such as PTSD, or mild traumatic brain injury.

Executive Order 12968, Access to Classified Information states mental health counseling in and of itself is not a reason to revoke or deny a security clearance. Seeking support to address mental health issues demonstrates inner strength and embodies the Warrior Ethos, Army leaders have said.

Professional mental health counseling is not a threat to an individual’s security clearance; rather it can be a positive factor in the security clearance process, officials said.  CCF’s adjudicative history indicates that 99.98 percent of cases with psychological concerns obtained/retained their security clearance eligibility.  The current policy provides both adjudicators and commanders flexibility to allow individuals undergoing counseling to maintain their security clearance.

Related Articles: Personal Finances and Security Clearances

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Worried about being denied a security clearance because of bad credit? Considering a credit repair company to fix your credit report?

In an AARP Bulletin Today Scam Alert article, Credit Repair’s Dirty Business, Steven Baker of the Federal Trade Commission (FTC) was quoted as saying, “In the last year, we’ve seen an increase of 50 percent in reports of credit repair scams. And to date, we’ve never seen a legitimate credit repair company. False promises, upfront fees, and worthless services may be the norm.

Since 1998 the FTC has brought action against over 50 credit repair firms that allegedly misrepresented their credit-related services. The FTC also prosecuted more than a dozen companies that allegedly offered debt relief but misrepresented the cost or nature of the relief.

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