Security Clearance Denial

Clearance Denied Due to Overdue Student Loans

Based on historical Defense Office of Hearing and Appeals (DOHA) cases, it would be a good bet that one of the first cases for this year involved financial issues. The DoD Central Adjudication Facility (CAF) issued this applicant a Statement of Reasons (SOR) regarding her $212,000 in delinquent student loans that were placed in collections. In her response to the SOR, she provided information indicating she had contacted the Department of Education to rehabilitate the loans with a new loan servicer, therefore the loans were no longer delinquent. The DoD denied her eligibility for a clearance, and she subsequently appealed to DOHA.

In her appeal she claimed the DoD judge had incorrectly determined her loans were still delinquent. However, the denial focused not on the loans themselves, but the fact that she didn’t make any good faith efforts to resolve the delinquencies between December 2014 (when they became delinquent) and July 2022 when she was issued the SOR, despite having the income to do so.

The only reason she took any action was because she was issued the SOR and realized her job might be in jeopardy if she couldn’t get a security clearance. This self-serving motivation to take action did not excuse the fact she did nothing about it for 8 years.

The DOHA judge agreed with the premise that an applicant who begins to resolve their financial problems only after being placed on notice that they may not be eligible for a security clearance may be lacking in judgment and self-discipline. A classic case of money being the motivator, hence, the very real possibility of also compromising national security for the same. The initial clearance denial was upheld.


  1. For fiscal accountability and responsibility to be maintained, intrinsic transparency is certainly necessary. There is, however, a dire need for reform of educational loans. The current system makes it too easy for both the unaware and those who are knowledgeable enough to manipulate it. There needs to be more checks and balances in place to encourage the unaware to make more informed credit worthy decisions, as well as to deter would-be manipulators of the system. To protect future ‘security clearance entanglements,’ a credit-based pre-test application for a loan may be one possible solution. Musings