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Definition of 'Bankruptcy Trustee'
A person appointed by the United States Trustee, an officer of the Department of Justice, to represent the debtor's estate in a bankruptcy proceeding.
Although a bankruptcy judge has the ultimate authority on the distribution of assets, the trustee is charged with evaluating and making recommendations about various debtor demands in accordance with the U.S. Bankruptcy Code.
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Investopedia explains 'Bankruptcy Trustee'
The responsibilities of the trustee are different in a Chapter 7 bankruptcy proceeding (which is essentially a liquidation) than in a Chapter 11 proceeding, wherein the debtor hopes to emerge from the bankruptcy as a going concern. In a Chapter 7 proceeding, the trustee will manage the asset sales and then distribute the proceeds to creditors.
A Chapter 13 proceeding applies to individuals who hope to keep some of their assets in return for repaying certain debts.
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