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What is a Trustee in Bankruptcy?
About Trustees in Bankruptcy
The website of the Superintendent of Bankruptcy describes trustees in bankruptcy as follows:
A trustee in bankruptcy is a person licensed by the Superintendent of Bankruptcy to administer proposals and bankruptcies and manage assets held in trust. The trustee can give a debtor information and advice about both the proposal and bankruptcy processes and make sure that both the debtor's rights and the creditor's rights are respected.
A person has to use a trustee if he or she goes bankrupt. However, trustees are not just for filing bankruptcy. They are also Professional Debt Consultants and can make arrangements with your creditors on your behalf; provide debt counselling; negotiate settlement agreements and help you make a proposal to your creditors to avoid bankruptcy. If a trustee feels you need the protection of independent legal advice the trustee will refer you to an insolvency lawyer. In some cases the trustee will be able to advise you of a solution that will cost you nothing and have you avoid bankruptcy.
When dealing with a trustee you are protected firstly by the fact that the federal government regulates trustees and secondly by the stringent code of ethics to which all trustees are subject.
In most cases, It will cost you less to use a trustee than other Debt Consultants since trustees have their fees regulated by the government.
Trustees are the most highly trained and educated Debt Consultants in Canada. Almost all trustees have both an accounting designation and a university degree. In addition, all must complete and pass a rigorous three-year bankruptcy and law course and be investigated by the RCMP before being granted a trustee licence. Ongoing professional development is mandatory.
Bankruptcy Trustees are the only debt professionals in Canada who can guarantee you protection from your creditors; even CRA (Revenue Canada.