Report: Loss of Security Clearances Matches Rise in Home Foreclosures

An increase in the number of security clearances of government workers and contractors that are denied or revoked matches the rise in home foreclosures, according Sheldon Cohen, a Virginia-based attorney specializing in security cases.

Cohen studied the results of cases at the Department of Defense Office of Hearings and Appeals (DOHA) from 2006 to 2010 that included the terms "foreclosure" and "short sales".

"From 2000 to 2002, there was one reported case at DOHA dealing with foreclosure. Between 2003 and 2006, there averaged three cases per year. In 2007 and 2008, the number of cases dealing with foreclosures jumped to nine each year. In 2009, there were twenty-four such cases, and in the first five months of 2010, which looks like a record year, there have been nine foreclosure cases thus far," according to the report.

While the actual number of denials or revocations is not large--there are an estimated 3 million government employees and 1.5 million contractors with some level of security clearance--Cohen notes that there are 11 other administrative bodies across the government that make rulings on security clearances similar to DOHA. Those results are not made public.

The so-called Uniform Guidelines are the standard for security clearance eligibility and it is "Guideline F: Financial Considerations" that comes into play here: a security clearance and serious money problems don't mix. People with ballooning mortgage payments or a pending foreclosure are seen as vulnerable to offers of money in exchange for secrets.