By Sheldon I. Cohen

While the Obama Administration says it is trying to save jobs, stave off foreclosures, fight real estate fraud, and help small businesses survive, the Department of Defense is doing just the opposite. It is revoking the security clearances of people who lose their real estate to foreclosure, even when the loss was caused by fraud, and even though they are protected by state antideficiency laws that absolve the homeowner from further debt on the foreclosure.

An office under the Secretary of Defense, the Defense Office of Hearings and Appeals (DOHA), has recently ruled that a person who owned and lost residential properties in foreclosure as a result of being the victim of a real estate scam would lose his security clearance. This ruling came despite the person having a security clearance for thirty years with an otherwise impeccable record. As a result, his company, which specializes in highly technical defense communications work, can no longer perform any defense contracts, and his thirty employees are in danger of being laid off.

The author is in the private practice of law in Arlington, Virginia. He is the author of Security Clearances and the Protection of National Security Information: Law and Procedures, 335 pp., published by the Defense Personnel Security Research Center, Technical Report 00-4, November, 2000. It is available online from the United States National Technical Information Center, www.ntis.gov, Accession Number ADA 388100. The author may be contacted at www.sheldoncohen.com

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