News Room

Bankruptcy & your government security clearance

May 26, 2015

Military and government personnel are concerned that filing bankruptcy may negatively impact their security clearance and their jobs -- even when a superior instructs them to file. Here are some guidelines.

Whether a consumer bankruptcy filing will affect current or requested security clearance depends on the honesty of the person being investigated, the individual circumstances and the opinion of the adjudicating agency.

All investigations are performed by the Office of Personnel Management/Federal Investigative Services (OPM/FSI) staff or OPM outside contractors.

OPM/FIS reports to the “client” – a government agency – and the agency performs the actual adjudication. Depending on the situation, the agency can (1) deny clearance, (2) approve clearance, or (3) issue a provisional or temporary clearance pending further investigation. There is due process and an appeal procedure.

Falsifying any information on the investigation questionnaire or in interviews is very damaging to the applicant.

OPM/FSI investigations use the “whole person” concept. Efforts to mitigate negative behavior or action are key elements. For example:

>> If a person has overwhelming debt from family medical bills and makes a timely bankruptcy filing along with credit counseling and any other discharge requirements, the bankruptcy may be regarded as a good faith action to mitigate the problem.

>> If a person runs up irresponsible credit card debt and refuses to acknowledge requests for payment for some time and there is subsequent legal action, a bankruptcy may not be regarded as appropriate mitigation and may negatively affect the security clearance.

More information on bankruptcy and security clearances.

Questions? Call or click here for a free consultation with a skilled, experienced Boleman Law attorney to discuss your situation.

Boleman Law is Virginia's largest consumer bankruptcy law firm. Since 1991 we have helped over 106,000 Virginians regain their financial health.

We will help you.


Mark C. Leffler

Mark Leffler, Chief Counsel and Shareholder, joined Boleman Law Firm in 2000 after practicing real estate, business litigation and corporate formation law. He is an author, editor and frequently a featured speaker on consumer bankruptcy matters.

He is co-author of, “Bankruptcy Practice in Virginia”, a Virginia CLE Publication,  Editor, Virginia State Bar Bankruptcy Section’s Bankruptcy Law News and Panelist at the annual conferences of the National Association of Chapter Thirteen Trustees.

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