What Does A Bankruptcy Trustee Do
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Posted: 05/01/2008-22/09/2010 || Rate this Article: 3 || Views
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 debtors 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 efficiently, 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.