Who Is the U.S. Trustee in the Bankruptcy Process?

Someone You Hope You Will Not Meet in Your Chapter 7 or Chapter 13 Case

The U.S. Trustee’s Office is a division of the U.S. Department of Justice tasked with overseeing the bankruptcy process in the United States. The Role of the U.S. Trustee encompasses a number of different tasks, but the primary focus tends to be on a couple of different areas of specific concern to you as a consumer considering filing for bankruptcy:

• “Safeguarding” Chapter 7 eligibility by scrutinizing the Means Tests and income and expenses of each Chapter 7 filed;
• Ensuring that the people who you pay to help you prepare your petition are doing so within the framework of the law;
• Appointing and supervising the Chapter 7 and Chapter 13 Trustees who you actually interface with in your bankruptcy proceedings; and
• Prosecuting criminal cases related to bankruptcy matters when required.

The U.S. Trustee is tasked with policing not only the behavior of the real human beings actually filing bankruptcies in the U.S. but also the creditors responding to and filing claims for the debts they are allegedly owed within bankruptcy cases, but, as with Chapter 7 and Chapter 13 Trustee, the scrutiny laid upon creditors is very cursory relative to the amount of energy they spend policing the Means Test and the fees paid to debtors’ attorneys and (quite rightly) non-attorney “petition preparers.”

Should I Worry About the U.S. Trustee?

The vast majority of Chapter 7 and Chapter 13 cases filed do not involve any interaction with the U.S. Trustee. Although the staff and trial attorneys employed by the U.S. Trustee do review the transcripts of every 341 Meeting of Creditors meeting and Means Test and other petition Schedules filed in Chapter 7 cases, the reason that their role stops there in most cases is  because the filing debtor has hired a good bankruptcy attorney to assist them.

If you have retained an experienced bankruptcy attorney to assist you with your Chapter 7 or Chapter 13 filing, you will in all likelihood have little reason to be concerned about the U.S. Trustee. Your attorney will guide you through the assembly of the documentation required to accurately, honestly, and fully disclose all of the assets, debts, income, expenses, and other past and expected future financial transactions that are required to be disclosed in the bankruptcy petition. If you are eligible for Chapter 7 and it is the best option for you relative to other non-income considerations, your attorney will so advise you and guide you through that process. If you are not or Chapter 13 is the better option for you for a variety of reasons, your attorney will expertly guide you through that process.

The guidance of a knowledgeable bankruptcy lawyer is what will keep the U.S. Trustee away from your case. Attempting to draft your petition yourself or to calculate your own Means Test or paying a non-attorney “petition preparer” a few hundred bucks to “fill in the blanks” on the “bankruptcy forms” is a good way to put yourself in the cross-hairs of the U.S. Trustee.  It is potentially a good way to encounter Federal criminal charges, depending upon what you decide you don’t have to disclose.

If you are a Michigan resident and would like to explore your options for a Chapter 7 or Chapter 13 bankruptcy with an experienced Michigan bankruptcy attorney, please contact  The Hilla Law Firm, PLLC at (866) 674-2317 or click the button below to schedule a free, initial consultation.

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If you enjoyed reading “Who or What Is the U.S. Trustee,” please browse Attorney Hilla’s other articles on his main Michigan Bankruptcy Blog.

Why Is It Essential To Attend the 341 Creditor Meetings?

When a debtor files a Chapter 7 or Chapter 13 bankruptcy, they are required to attend a 341 Creditor Meeting. Many debtors wonder why they must attend these meetings and do not understand the significance of these meetings. When a person files bankruptcy, the bankruptcy petition and schedules are submitted electronically. One of the reasons why it is important to attend is so the trustee (the person who is overseeing the bankruptcy and sending their recommendations to the court) can see the debtors in person and match their driver’s license and social security number to the person and to the information in the bankruptcy petition.

 

 

This is the trustee’s opportunity to make sure the debtor signed the bankruptcy petition and schedules and that the debtor understands what they signed and has read the Statement of Information, which is a document many attorneys attach to the Notice of Bankruptcy when they forward it to their client and a document all debtors must read before their meeting. The 341 meeting is also a chance for the debtor’s creditors to appear and question the debtor. They are given the date and time of the 341 Creditor Meeting. Most of the time, the creditors do not appear, but they must be given this opportunity to address the debtor if they wish. Overall, the 341 creditor meeting is a chance for the trustee to verify information with the debtor under oath and make sure everything has been included and is accurate before the case can be discharged.