Chapter 7 Cases

In Chapter 7 cases, the U.S. Trustee litigates issues that affect the integrity of the bankruptcy system. The U.S. Trustee also appoints and supervises the Chapter 7 trustees who administer consumer debtors' bankruptcy estates. Usually there are no assets available for distribution to creditors in Chapter 7 cases. If a Chapter 7 debtor does have property that is not exempt from the reach of creditors under either state or federal law then the Chapter 7 trustee may sell that property and distribute the money to creditors.

Additionally, the U.S. Trustee appoints Chapter 7 trustees to a panel for up to one year. The terms are renewable at the discretion of the U.S. Trustee. The "panel trustees" are assigned to Chapter 7 cases on a blind rotation basis. The U.S. Trustee supervises the panel trustees' administration of individual debtor estates, monitors the trustees' financial record-keeping, and imposes other requirements to ensure that the trustees carry out their fiduciary duties.

Chapter 11 Cases

Chapter 11 offers a procedure by which an individual or a business may attempt to "reorganize" its debts while continuing to operate. The majority of Chapter 11 cases are filed by businesses. The duties of the U.S. Trustee in a Chapter 11 bankruptcy case include the following:

* Reviewing a debtor's requests for emergency orders early in a bankruptcy case and ensuring that the requested relief is tailored to the circumstances.

* Deciding what official committees should be established to serve in the case, appointing committee members and engaging in oversight of committee actions. Each committee upholds the interest of the creditor group it represents. U.S. Trustee oversight includes organizing the committee and supervising the professionals who are employed by the committee.

* Reviewing reorganization plans and disclosure statements to make sure that they provide adequate and accurate information.

* Ensuring that all required reports, schedules, and fees are timely filed and that the debtor manages money and assets consistent with the Bankruptcy Code and with its fiduciary duty to creditors.

* Taking action to prevent undue delay.

* Reviewing and, if necessary, objecting to any applications filed by professionals seeking employment in the case, payment of compensation, and/or reimbursement of expenses. The U.S. Trustee may also challenge the reasonableness of professional fees billed in a case.

* Investigating criminal, fraudulent, or abusive conduct for possible civil or criminal prosecution. The U.S. Trustee pursues civil penalties and refers cases of apparent criminal fraud to the U.S. Attorney for investigation and criminal prosecution.

Chapter 12 Cases

U.S. Trustees supervise the administration of family farm reorganization proceedings under Chapter 12. Chapter 12 allows an eligible family farmer to file for bankruptcy, reorganize the farm's business affairs, repay all or part of the farm's debts, and continue operating. A "standing trustee" appointed by the U.S. Trustee typically serves as the trustee of the debtor's estate pending fulfillment of the debtor's repayment obligation under a plan confirmed by the U.S. Bankruptcy Court where the case was filed.

Chapter 13 Cases

Chapter 13 is used primarily by individual consumers to reorganize their financial affairs under a repayment plan that must be completed within three to five years. The U.S. Trustee supervises the private trustees who administer Chapter 13 cases. In Chapter 13 bankruptcy, the trustees do not liquidate the debtor's assets, but instead help to organize the debtor's financial affairs so that the debtor may pay back some or all of the money owed to creditors. Most Chapter 13 cases are administered by "standing trustees" appointed by the U.S. Trustee to administer all cases filed in a certain geographic area. The U.S. Trustee supervises the Chapter 13 standing trustees' administration of individual bankruptcy estates, monitors the trustees' financial record-keeping, and impose other requirements to ensure that the trustees carry out their fiduciary duties.