Bankruptcy Notification

1. Introduction

Section 362 of the United States Federal Code on bankruptcy law describes an automatic stay as an automatic injunction that halts actions by creditors, with certain exceptions, to collect debts from a debtor who has declared bankruptcy. An automatic stay begins immediately after a bankruptcy petition is filed. East Carolina University (University) receives copies (hard copy and/or electronic) of bankruptcy related documents as it collects delinquent accounts from patients, students, employees, and others. The University is responsible for ensuring that these documents are available to units that report accounts receivables to the NC Office of State Controller in accordance with N.C.G.S. §147-86.21. The University shall devise techniques and procedures for how units manage the receipt and notice of these bankruptcy documents. The purpose of this regulation is to provide guidance to units throughout the University to ensure that collection actions are halted when an automatic stay is in place. Collection actions should be halted pending an official bankruptcy discharge or dismissal, thus avoiding penalties for violating an automatic stay.

2. Applicability

This regulation applies to any University unit that bills and/or collects receivables from any business or person who has filed for bankruptcy, regardless of the type.

3. University Financial Services Bankruptcy Site (Bankruptcy Site)

The ECU Collections, Collections Manager is responsible for developing and administering the Bankruptcy Site and procedures for site usage. The Bankruptcy Site is a secure repository for all University bankruptcy notifications, related documents, and communications with campus units.
The information stored in the Bankruptcy Site is confidential and should only be shared with necessary persons for reasons within the normal scope of operations. Any inadvertent disclosure must be reported to the ECU Collections Manager and resolved.

4. Departmental Requirements

Each unit that bills and/or collects funds is responsible for establishing a process consistent with State of NC policies and procedures for collections and bankruptcies, including the halting of collections upon notification that a petition for bankruptcy has been filed. Units should designate a representative responsible for utilizing the Bankruptcy Site and following the procedures located within the Bankruptcy Site. Unit representatives are required to conduct annual Health Insurance Portability and Accountability Act (HIPAA) training and one-time Family Educational Rights and Privacy Act (FERPA) training. Bankruptcy documents received by a unit should have their unit representative create the record and upload the documents. If a unit is aware of a bankruptcy and needs access to case information in Public Access to Court Electronic Records (PACER), and does not have their own access, the unit can contact the Office of University Counsel (OUC). OUC can provide a history page, the bankruptcy petition, the notice of meeting of creditors, and any discharge documents if applicable. Legal advice related to bankruptcy matters is provided to units, upon request, by the appropriate ECU attorney.