When a debtor files for bankruptcy protection, the debtor immediately benefits from the automatic stay, an automatic injunction that prohibits collection activity against the debtor. If a creditor violates the automatic stay, the creditor is at risk of being held in contempt of court, and could potentially be fined for the improper collection activity. When a debtor has filed a bankruptcy case, it is important to work with your collection attorney before you resume any collection activity, and also to ensure that you make a proper claim for compensation within the bankruptcy case.
Some debtors will mislead their creditors about bankruptcy. Some will falsely claim to have filed a bankruptcy case, when in fact none has been filed. Others will file a case and have notice served upon their creditors, then dismiss the case. How can you be certain that your debtor has an active bankruptcy case, and is not playing games to delay payment or to trick you into giving up on collecting the debt that they owe?
Possible means of verifying that a bankruptcy case has been filed and remains pending include:
Court Records (PACER) - Federal court records, including bankruptcy records, can be accessed through the Public Access to Court Electronic Records (PACER) system. It is necessary to open an account, and there are modest fees associated with obtaining records. If you received a notice from a bankruptcy court, you can use the case number from that notice to find the status of a case. You may also search by the debtor's name.
Credit Reporting Services - You may find information about bankruptcy filing through private, fee-based credit reporting services, such as Accurint.
It is crucial not to violate the automatic stay, or to try to collect a debt that has been discharged in bankruptcy. If you find cause to believe that a debtor is misleading you about bankruptcy, it may be appropriate to aggressively collect the debtor's account, as that type of debtor is among the most likely to try to avoid paying you what they owe, but due to the risk of violating bankruptcy and collections laws you should consult a collections professional before resuming collection activity on the debt.