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Will Washington Bankruptcy Affect My Military Secret Clearance?

March 19th, 2018 Bankruptcy Law Blog

Members of the military fall into debt for the same reasons that civilians do. Reasons such as divorce, bad financial investments, or unforeseen medical expenses can cause financial debt to spiral out of control. But what happens if you have a military secret clearance and want to file for Chapter 7 or Chapter 13 bankruptcy? Will filing for bankruptcy prevent you from obtaining security clearance or does it mean the end of your career?

Having a military secret clearance while in debt can be seen as a security risk. However, it ultimately depends on the circumstances that led you to your debt in the first place.

Military members walking with gear

Will Filing for Bankruptcy Affect My Security Clearance?

Filing for Chapter 7, Chapter 11 or Chapter 13 Washington bankruptcy will not automatically disqualify you from having a security clearance in the military. As we’ve already discussed, the government will look at the circumstances that led you to the decision to file bankruptcy. For example, the government may view your bankruptcy more favorably for uncontrolled situations, such as medical bills, rather than debt due excessive spending.

Government Financial Considerations

When it comes to security clearances, the government takes the details of a person’s financial situation into consideration. There are several negative financial conditions that can disqualify a person from having a security clearance:

  • Having financial problems due to gambling, drug addictions, or alcoholism
  • Tax evasion, theft, embezzlement or other financial misconduct
  • Maintaining lifestyle that is not commensurate with income
  • Not willing (or able) to pay debts

Having a secret clearance means that you have access to sensitive information that could put our national security at risk. In some cases, having financial debt shows that you have poor judgment skills and should not be entrusted with the responsibility. It can leave you vulnerable to enemies who can exploit your situation.

Transparency is Best

When it comes to bankruptcy and military secret clearances, being transparent is the best way to move forward. After consulting with our team at Law Offices of David Smith, we recommend notifying your Facility Security Officer (FSO). Being transparent about your financial situation shows that you have nothing to hide. In many cases, it shows that you are taking positive steps to take control of your finances.

Military Bankruptcy Attorney in Tacoma, WA

If you’re in the military and are facing crippling financial issues, schedule a free consultation as soon as possible. We are conveniently located less than thirty minutes away from Joint Base Lewis-McChord. At Law Offices of David Smith, our trusted and experienced bankruptcy attorneys have helped countless military members and their families get their spiraling debt under control.