Reporting Delinquent Financial Accounts is Required
Security Executive Agent Directive (SEAD) 3 establishes reporting requirements for all security clearance holders. Among the various categories of reporting is a section called financial anomalies. Clearance holders are required to report bankruptcies, wage garnishments, debts that are more than 120 days past due (no matter the amount), and unusual monetary gains of $10,000 or more. All security clearance holders receive an initial briefing and reporting requirements are covered prior to signing the SF-312. Failure to report these could result in suspension of access or even revocation.
A recent Department of Energy appeals case is a prime example of the above scenario. The local security office received an updated credit report on the employee as a part of continuous vetting. The report reflected four delinquent accounts that had not been reported to security. The employee’s clearance was suspended pending an appeal. During the appeal the employee claimed to not know she had a responsibility to report financial issues. However, the employee’s supervisor provided testimony corroborating the fact the employee did receive training on reporting requirements. The employee also admitted she was not really sure she could pay off the debts and meet monthly expenses, and that she did not have a strong understanding of her overall financial picture.
Although the total amount of the delinquent debts was not substantial, there appeared to be a pattern of not meeting her financial obligations over the past seven years. The judge in this case concluded that the employee had not provided mitigation for the financial issues, as well as the failure to report these issues to her security office. Her eligibility for access to classified information was revoked.