The primary duty of a Chapter 7 bankruptcy trustee is to administer the case and pay off the creditors. Immediately after filing of a bankruptcy petition, an interim trustee will be appointed. It is the duty of the interim trustee to conduct initial investigation into the debtor’s financial situation. After verifying the debtor’s documents, the trustee will get the debtor to testify under oath.
It is the duty of the interim trustee to conduct the 341 meeting. This meeting will be presided over by the trustee and all creditors will be provided notice of this meeting. In this meeting, the creditors can assess, question and agree or disagree to the debtor’s financial situation. In case the creditors do not exercise their right to appoint a trustee, the interim trustee will be converted to permanent trustee. Upon completion of the preliminary investigation, the trustee will file his findings and recommendations with the bankruptcy court.
After the 341 meeting and approval of bankruptcy, the Chapter 7 trustee will list out and sell all non-exempt properties of the debtor. The proceeds of sale will be used to pay out the creditors. If the trustee feels that one or more creditors are charging exorbitant fees or interest, s/he can bargain with the creditors and agree over payment of lesser amounts.
The trustee needs to keep all the records of transactions conducted in a Chapter 7 bankruptcy case. All receipts and documents should be made available to the debtor and the department of justice for verification upon request.
To summarize, it can be said that a Chapter 7 trustee is bound to collect and see the debtor’s non-exempt property and complete the case at the earliest. The trustee should be accountable for all property received and should express an intention to reaffirm debts. A Chapter 7 trustee has a duty to investigate debtor’s finances, verify proofs of claims, and provide interim and final accounts. S/he should also deal with patient’s medical records in health care bankruptcy cases.