Is it true that traffic violations can prevent becoming naturalized or a citizen?

When filing for naturalization you must disclose all arrests including citations for traffic matters. Nonpayment of taxes or nonpayment of traffic citations is seen by USCIS as reflecting on your good moral character. The main thing is not to ignore them. If you are having financial problems, you may want to contact the State's Attorney's office and ask if you can work out a payment plan to get these taken care of. If you have a plan agreed to by the government then your naturalization case can move forward.

He can apply to get the fee waived. As to whether they can deny his application, he has to prove that he has been a person of good moral character for the last 5 years. Depending on the infractions he has had they could use to make a determination on his moral character.

Generally, traffic violations for minor issues, such as speeding, running a red light, etc. are not evidence of lack of good moral character and would not be a reason to deny the application. We would need to know what traffic violations he was convicted of, were their misdemeanors, did he spend time in jail, did he comply with the sentence (paid the fines, did the community service, etc.) to determine if the USCIS decision was wrong. Regarding paying the fee for the N-336, he may qualify for a waiver of the fee. He needs to go to the USCIS website and review the fee waiver application form.