What Does A Bankruptcy Trustee Do?

By: Sslowery

United States Trustees supervise the administration of the following cases filed under the Federal Bankruptcy Code:

  • Liquidation proceedings under Chapter 7 bankruptcy- Those assets that are not exempt from creditors are collected and liquidated (reduced to money). The proceeds are distributed to creditors by a private trustee appointed to administer the debtor’s estate under Chapter 7.
  • “Wage-earner" reorganization proceedings under Chapter 13- Chapter 13 bankruptcy- , is used primarily by individual consumers to reorganize their financial affairs under a repayment plan that must be completed within three to five years.

    A “standing trustee" appointed by the United States Trustee typically serves as a trustee of the U.S. Bankruptcy Court where the case was filed.

Specific responsibilities of the United States Trustees include:

  • Appointing and supervising private trustees who administer Chapter 7, 12 and 13 bankruptcy estates (and serving as trustees in such cases where private trustees are unable or unwilling to serve).
  • Taking legal action to enforce the requirements of the Bankruptcy Code and to prevent fraud and abuse.
  • Referring matters for investigation and criminal prosecution when appropriate.
  • Ensuring that bankruptcy- estates are administered promptly and efficientlyFeature Articles, and that professional fees are reasonable.
  • Appointing and convening creditors’ committees in Chapter 11 business reorganization cases.
  • Reviewing disclosure statements and applications for the retention of professionals.
  • Advocating matters relating to the Bankruptcy Code and rules of procedure in court.

Bankruptcy
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