Security Clearance Denial

Helping Others and Poor Investment Savvy that Lead to Financial Issues = Clearance Denied

I recently ran across a DOE security clearance appeals case where an individual was denied a security clearance due to financial issue concerns. Well, you say, so what? Financial issues are the number one reason for a denial, right? What made this case unique was that it involved a psychological condition known as a self-defeating personality disorder that led the individual to financially take care of others, eventually exceeding his capability to financially take care of himself and his own family.  The judge in this case was of the opinion that although the disorder does not fall under specific mental condition criteria, the fact that this individual was so easily talked into giving away hundreds of thousands of dollars to support people not even related to him makes it a national security concern. Even though mitigation in the form of counseling and discharge of the debts through bankruptcy were considered, a concern still existed that the individual would employ poor judgment in the future by continuing to engage in other self-defeating financial decisions that would again become a security risk.

Poor Financial Judgment Points to Broader Security Concerns

Along these same lines, falling victim to fraud scams or making poor fiscal decisions may also result in a security clearance denial, as one applicant found out in a DOHA appeals case. In summary, the issues in this case involved the individual making a poor real estate investment decision resulting in a foreclosure and then later agreeing to serve as a surrogate for a credit card company allowing them to open 20-30 credit cards in the individual’s name and then left him holding the bag on over $200K worth of bad debt. You may be asking yourself why someone who was considered a victim would be denied a clearance, well, here is the rationale: Entering into financial agreements that a reasonable person would find questionable, despite the lack of ill intent or fiscal savviness, raises concerns about an individual’s judgment, reliability, and trustworthiness which has a direct correlation to protecting classified information.


  1. Fascinating. But makes sense. I would tend to believe demonstrated years of not falling into this trap again as a successful mitigation. But of course the initial denial and reason would need reported, reinvestigated, etc.