The United States Trustee Program |
The United States Trustee Program is a
component of the Department
of Justice that seeks to promote the efficiency and protect
the integrity of the Federal bankruptcy system. To further
the public interest in the just, speedy and economical resolution
of cases filed under the Bankruptcy
Code, the Program monitors the conduct of bankruptcy parties
and private estate trustees, oversees related administrative
functions, and acts to ensure compliance with applicable laws
and procedures. It also identifies and helps investigate
bankruptcy fraud and abuse in coordination with United
States Attorneys, the Federal
Bureau of Investigation, and other law enforcement agencies.
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Background of the U.S. Trustee Program
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The Program was established by the
Bankruptcy Reform Act of 1978 (11 U.S.C. § 101, et seq.)
as a pilot effort encompassing 18 districts. It was
expanded to 21 Regions nationwide,
covering all Federal judicial
districts except Alabama and North Carolina (see Note
below), by enactment of the Bankruptcy Judges, U.S. Trustees,
& Family Farmer Bankruptcy Act of 1986 (Pub. L.
99-554, 100 Stat. 3088, reprinted in part at 28 U.S.C. §
581, note). The Program is funded by the United StatesTrustee
System Fund, which consists primarily of fees paid by parties
and businesses invoking Federal bankruptcy protection.
The primary role of the U.S. Trustee Program is to serve
as the "watchdog over the bankruptcy process."1/
As stated in the USTP Mission
Statement:
The USTP Mission is to promote integrity and
efficiency in the nation’s bankruptcy system by enforcing
bankruptcy laws, providing oversight of private trustees,
and maintaining operational excellence.
2/
The Attorney General is charged with the appointment of United
States Trustees and Assistant United States Trustees. The
Executive Office for U.S. Trustees (EOUST)
in Washington, D.C., provides general policy and legal guidance,
oversees the Program's substantive operations, and handles
administrative functions. The Director of the Executive Office,
whose authority derives from the Attorney General, oversees
a staff comprised of the Offices of the Director, General
Counsel, Administration, Review & Oversight, and Research
& Planning. The Executive Office also provides administrative
and management support to individual U.S. Trustee Offices
in their implementation of Federal bankruptcy laws. See
28 U.S.C. §§ 581-589a. |
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Principal U.S. Trustee Duties under the
Bankruptcy Code |
United States Trustees supervise the
administration of the following cases filed under the Federal
Bankruptcy
Code:
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Liquidation proceedings under Chapter
7 In Chapter 7 "liquidation" proceeding,
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 (see generally 11
U.S.C. §§701-704). An eligible debtor may receive
a "discharge" from his or her debts under Chapter
7, except for certain debts that are prohibited from discharge
by the Bankruptcy Code.
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Reorganization proceedings (usually
business-related) under Chapter
11 Chapter 11 offers a procedure by which an
individual or a business may attempt to "reorganize"
its debts while continuing to operate. The vast majority
of Chapter 11 cases are filed by businesses. The debtor,
often with the participation of creditors, creates a reorganization
plan under which to repay all or part of its debts. The
"debtor in possession" may generally continue
business operations pending reorganization, unless a trustee
is appointed under Chapter 11 (see, e.g., 11 U.S.C. §1104).
Section 1930(a)(6) of the U.S. Code (28
U.S.C. ยง1930(a)(6)) prescribes "quarterly fees"
that are to be paid by Chapter 11 debtors to the U.S.
Trustee Program. In essence, quarterly fees accrue throughout
the pendency of a Chapter 11 reorganization case (i.e.,
until the case is closed, dismissed, or converted to another
chapter) and are payable on a quarterly basis, 30 days
following the end of each calendar quarter. "The
amount of the quarterly fee [is] calculated according
to a graduated scale based on the total sum of disbursements"
as specified in §1930(a)(6), and "disbursements"
include all pre- and post-confirmation payments made by
or on behalf of the debtor, including routine operating
expenses. See, e.g., Tighe
v. Celebrity Home (In re Celebrity Home Entertainment,
Inc.), 210 F.3d 995 (9th
Cir. April 21, 2000). For more information regarding
Chapter 11 quarterly fees, please contact the Office
of the United States Trustee in the judicial district
where the case was filed.
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Family farm and fisherman reorganization proceedings
under Chapter
12 Chapter 12 allows an eligible family farmer
or a fisherman to file for bankruptcy, reorganize the business'
affairs of the farm or fishing business, repay all or part of the business' debts, and continue
operating. A "standing trustee" appointed by
the United States Trustee under 28
U.S.C. §586(b) typically serves as the trustee
of the debtor's estate pending fulfillment of the debtor's
repayment obligations under a plan confirmed by the U.S.
Bankruptcy Court where the case was filed.
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"Wage-earner" reorganization proceedings
under Chapter
13 Chapter 13, often called wage-earner bankruptcy,
is used primarily by individual consumers to reorganize
their financial affairs under a repayment plan that must
be completed within three or five years. To be eligible
for Chapter 13 relief, a consumer must have regular income
and may not have more than a certain amount of debt, as
set forth in the Bankruptcy Code. A "standing trustee"
appointed by the United States Trustee under 28
U.S.C. §586(b) typically serves as the trustee
of the debtor's estate pending fulfillment of the debtor's
repayment obligations under a plan confirmed by the U.S.
Bankruptcy Court where the case was filed.
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Specific responsibilities of the United
States Trustees include: |
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Appointing and supervising private trustees
3/ 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);
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Taking legal action to enforce the requirements of the
Bankruptcy Code and to prevent fraud and abuse;
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Referring matters for investigation and criminal prosecution
when appropriate;
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Ensuring that bankruptcy estates are administered promptly
and efficiently, and that professional fees
are reasonable;
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Appointing and convening creditors' committees in Chapter
11 business reorganization cases;
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Reviewing disclosure statements and applications for
the retention of professionals; and
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Advocating matters relating to the Bankruptcy Code and
rules of procedure in court. |
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For Further Information: |
- See Bankruptcy
Fact Sheets & Consumer Notices
- E-Mail the Executive Office for U.S. Trustees at:
USTWeb
- or Contact Us at:
- Executive Office for U.S. Trustees
Office of the General Counsel
Department of Justice
20 Massachusetts Ave., N.W., Suite 8000
Washington, D.C. 20530
(202-307-1399/FAX-2397)
ADVISORY: The
Department of Justice does not provide legal advice to individual
members of the public. For specific bankruptcy-related advice,
please consult qualified legal counsel. A list of private
attorneys in your area may be available from your State
bar association, local law schools, or legal aid clinics.
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JURISDICTIONAL
NOTE Bankruptcy cases in Alabama and North Carolina are not under the jurisdiction of the United States Trustee Program. Questions regarding bankruptcy cases filed in the six judicial districts in those states should be directed to the Bankruptcy Administrator for the district where the case is pending. Contact information for the Bankruptcy Administrators is available on the federal judiciary's Web site at http://www.uscourts.gov/bankruptcycourts/administrators.html. |
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FOOTNOTE REFERENCES
1. House Report No. 989, 95th Cong.,
2d Sess. at 88 (reprinted in 1978 U.S. Code Congressional &
Admin. News at 5787, 5963, 6049).
2. See United States Trustee Program
Mission Statement. 3. Visit the
on-line U.S.
Trustee Program Reference Library to locate private
bankruptcy trustees. |
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