When a client and their attorney file for bankruptcy it is not automatically presumed that everything listed on the petition is the exact truth. Attorneys generally will not file any claims knowing they are not accurate, but then again, the attorney is relying on the clients honesty to insure all the appropriate information is available.
In the majority of bankruptcy cases the attorney filing the petition has already gone through the paperwork to determine if any claims being made are inaccurate. Once the case is filed, the trustee will go over all information supplied by the client, looking for inaccuracies or reasons to believe fraud may be involved.
The role of the trustee in bankruptcy to insure all creditors are treated fairly and that any non-exempt assets are sold for the most money, which is then distributed to the creditors in accordance with their claims.
The United States Trustee who is an officer of the Department of Justice appoints trustees. There are no state agencies involved in a bankruptcy proceeding as all matters are handled through the federal bankruptcy courts.
They will also participate in creditor meetings and has the power to...
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