Licensed Trustee in Bankruptcy
The Superintendent of Bankruptcy, a federal government department is considering changing the title of “Bankruptcy Trustee” to “Licensed Trustee in Insolvency & Restructuring”. If this change goes through what will it mean to Consumers?
Bankruptcy trustees are the only professionals that are licensed by the federal government to provide businesses and individuals with relief from overwhelming debt. But people are intimidated by the word “bankruptcy “. The perception seems to be that bankruptcy is bad and the name has negative contagions. That negativity can be used to manipulate consumers into avoiding talking to a licensed professional and into a course of action that has its own set of consequences and might not even be the right course of action for that individual’s situation.
The reality is that bankruptcy is not the only service provided by a bankruptcy trustee.
The concern among many insolvency professionals has been that the term “bankruptcy trustee” is too limiting. Licensed insolvency professionals (bankruptcy trustees) undergo a rigorous training and screening process, and usually have an accounting designation (CGA, CA, CMA, CPA) as well as the Charted Insolvency & Restructuring Professional designation (CIRP). This training provides each insolvency professional with the knowledge and experience to work through financial problems, whether simple or complicated, and identify the possible solutions. And to explain all of the solutions in a straight forward and understandable way. Insolvency professionals are the only professionals that can offer bankruptcy and proposal (Division I Proposals or Consumer Proposals) services. Insolvency professionals also act as consultants to individuals and businesses to help with restructuring their debt and arranging payment plans with their creditors thereby avoiding bankruptcy, and provide financial counselling to individuals to help them better manage their money in the future.
So what’s in a name? Hopefully by changing the title to “Licensed Trustee in Insolvency & Restructuring” (LTIR) the fear of “bankruptcy” will no longer prevent people from seeking out the best professional advice they can get to deal with their problem. It will also hopefully prevent unlicensed parties from calling themselves “insolvency professionals”.