{"id":1362,"date":"2019-07-17T16:22:40","date_gmt":"2019-07-17T20:22:40","guid":{"rendered":"https:\/\/eisen-shapiro.com\/law\/?p=1362"},"modified":"2019-08-11T12:33:27","modified_gmt":"2019-08-11T16:33:27","slug":"responding-to-debt-cases","status":"publish","type":"post","link":"https:\/\/eisen-shapiro.com\/law\/2019\/07\/17\/responding-to-debt-cases\/","title":{"rendered":"Responding to Debt Cases"},"content":{"rendered":"

Knowing the Territory: Debt Cases<\/p>\n

In our security clearance practice there\u2019s almost a flavor of the season to the kinds of cases that come to us. Recently the flavor has been debt cases. These are cases where the subject has some past-due and unpaid debt or set of debts they may or may not have known about or has failed to file tax returns in a timely manner. There are decisions at DOHA saying the government is not in the debt collection business, but that\u2019s an opinion of a few adjudicators in a few cases and not the practice.<\/p>\n

After handling a good number of these, some pretty straightforward practical rules -for what wins and what doesn\u2019t- leap out. The details will always be complicated and unique to each case, but we\u2019ve identified two rules of thumb that are helpful in judging how the scale will balance.<\/p>\n

We\u2019ll look first at the governing guideline, Guideline F<\/a>, because the practical rules begin with \u201cThe Rule\u201d set out there. The concern in guideline F arises when there\u2019s indication that a subject has failed \u201cto live within one’s means, satisfy debts, and meet financial obligations… .\u201d Nine different facts or fact patterns that may raise this concern (\u201cbad facts\u201d) are then listed, ranging from inability to satisfy debts to failure to file tax returns or to pay taxes. The Guideline explains, by the introductory narrative and by some of the bad fact descriptions, that the debt may indicate another kind of failure, like a gambling or drug addiction.<\/p>\n

Whatever the underlying reasons for someone failing to \u2018live within means, satisfy debt, or meet financial obligations,\u2019 the first practice rule is to test whether the expressed Guideline F concern really arises. For example, while a debt one didn\u2019t know about and is able to pay-off in a heartbeat from available funds may indeed be a \u201cbad fact\u201d if only because it allows one of the 9 bad fact boxes to be checked, it proves nothing about whether one is living within means. If the subject, upon learning of the debt, pays it off, that would be evidence that the subject is living within means. The rule of thumb that follows is if you pay off all legitimate debts prior to hearing, you may (or may not, depending) still have some explaining to do (about how the debt came to be, how it came to be past due, etc.) but there are a variety of acceptable explanations that may match your facts and should conclude the matter favorably. (As to debts that are not proven or provable -due to mistaken identity or messed up records or something else- one must document that these other debts are in a dispute process or have been struck from one\u2019s credit record.)<\/p>\n

Sometimes debts are too large to pay off and\/or there is ongoing financial strain evidenced by high debt balances, bad debt vehicles such as credit cards, and insufficient resources to pay these debts off. The practice rule in these cases is to reorganize resources well in advance of the hearing date so that what can be paid is paid and regular payments have been made under plans in place to pay off the rest of the legitimate debts, including credit card balances. This may call for the assistance of a professional debt consolidator or negotiator or accountant or CPA or the like, and we\u2019ve found the good ones to be extremely helpful in ordering our client\u2019s finances.<\/p>\n

This leads to the second rule of thumb for the winning case: a rule worth following even if everything is paid off in full. The key question in Guideline F cases is the subject\u2019s financial situation. Thus anyone facing a Guideline F case should provide hard evidence of what their financial situation is. A subject should prove, by statements received, what assets exist and should show, by a supported detailed financial statement, where the money comes from and where it\u2019s going every month. If the adjudicator isn\u2019t confident that a subject has found a path to solvency and is set on that path, it would be easy to conclude that the same case will arise again next year and even easier to conclude in the case at hand that clearance should not be granted.<\/p>\n

There are millions of clearance holders and undoubtedly thousands of distinct fact patterns concerning debt and details do matter. But the broad strokes outlined above are very helpful in identifying winning cases, in mitigating hard cases, and in identifying cases not worth pursuing.<\/p>\n","protected":false},"excerpt":{"rendered":"

Knowing the Territory: Debt Cases In our security clearance practice there\u2019s almost a flavor of the season to the kinds of cases that come to us. Recently the flavor has been debt cases. These are cases where the subject has some past-due and unpaid debt or set of debts they may or may not have known about or has failed to file tax returns in a timely manner. There are decisions at DOHA saying the government is not in the … Continued<\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[3],"tags":[],"class_list":["post-1362","post","type-post","status-publish","format-standard","hentry","category-security_clearance"],"yoast_head":"\nResponding to Debt Cases - Eisen & Shapiro Law Firm<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/eisen-shapiro.com\/law\/2019\/07\/17\/responding-to-debt-cases\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Responding to Debt Cases - Eisen & Shapiro Law Firm\" \/>\n<meta property=\"og:description\" content=\"Knowing the Territory: Debt Cases In our security clearance practice there\u2019s almost a flavor of the season to the kinds of cases that come to us. 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