Bankruptcy Trustee

Posted in Finance, Accounting and Economics Terms, Total Reads: 451

Definition: Bankruptcy Trustee

Bankruptcy Trustee (or the trustee in bankruptcy) is a trustee appointed by court who has a responsibility to take possession of any assets that will benefit the creditors, sell them and subsequently distribute the proceeds.

The functions of trustee are defined separately for different chapters in bankruptcy. 

Chapter 7 : Trustee sells the assets and pays up the creditors.

Chapter 13 : Distributing borrower's payments to creditors

The trustee's duties and powers are derived from both primary and secondary legislation, mainly insolvency law. They are expected them to be abide by their ethical guidelines.

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