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3 Career Paths Affected by Bankruptcy

  • January 20, 2018

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Today's contributed post is a cautionary tale on career paths affected by bankruptcy. Read on to make yourself aware of the dangers and let us know your thoughts in the comments.

career paths affected by bankruptcy

Declaring bankruptcy is never an easy decision, and a lot of people are wary of it for a number of reasons. With a skilled and experienced bankruptcy attorney like, you can hope to get your life back on the track quickly, but there are some consequences. In some cases, banks can deny loaning you any money due to your previous bankruptcy, or a landlord may choose not to lease you an apartment or a house.

However, there is an anti-discriminatory provision in the bankruptcy law which states that you cannot be denied employment or fired on the basis of your bankruptcy, even if your employer knows that you have filed for bankruptcy. That said, there are certain careers and business opportunities which may become unavailable to you if you have filed for bankruptcy in the past.

Jobs Requiring a Security Clearance

In order to get a security clearance, you will have to undergo a credit score check. If you have filed for bankruptcy recently, your credit score will be quite poor, which will result in the denial of your security clearance.

Military posts, as well as FBI or CIA jobs all fall into this category and your poor credit score marks you as a risk for blackmail or selling confidential information in order to get your finances back on track.

If you already have a job with a security clearance, you will probably not be fired, but you will lose your security clearance and be reassigned to a post which is less responsible and probably pays less.

Law Enforcement

Getting a job in law enforcement after bankruptcy is unlikely for the same reason as the previous entry. You would be privy to a variety of confidential information, not to mention confiscated materials like drugs, money, or weapons. Law enforcement agencies aren’t too willing to give access to either of those things to people who might be considered a liability.

If you already have a job at a law enforcement agency, you cannot lose your job for filing for bankruptcy, specifically because of the anti-discriminatory provisions in the law. However, you can be demoted to a position where you wouldn’t have access to the sensitive material and information. In some cases, your superiors may start collecting information about your performance in order to dismiss you on those grounds.


People who have filed for bankruptcy have a certain stigma of unfit to handle money, which means that financial institutions aren’t too keen to hire them to handle large sums of money. Accounting, banking, or payroll jobs are usually off the list.

Even though they cannot fire you or refuse to hire you based on the bankruptcy alone, they still have the right to ask you to perform a credit score check. They do have the right to decide who to hire or not based on your credit score. They prefer people who have a good credit score to handle money because it is believed that those people would be less prone to embezzle money for their own purposes.

If you refuse to approve a credit score check, they are once again legally allowed to deny you employment. It is, therefore, better to tell them outright what they can expect beforehand.

The Best Practice

Your current employer doesn’t have to know about your bankruptcy if you prefer to keep that information from them. However, if they perform a credit score check on you, they will see it. But, they cannot perform this check without your signed approval.

That means that you have the chance to tell them about the situation and your reasons when you filed for bankruptcy. Your bankruptcy attorney should be able to help you understand your position a bit better, so you should be able to explain it to your employer.