There are typically three parties involved in a bankruptcy proceeding, the bankrupt, the licensed insolvency trustee, and the creditors
The Debtor: is an insolvent person who is unable to pay their debts when they are due. There are several options available to an insolvent person. A debtor becomes the bankrupt when they officially declare bankruptcy.
The Licensed Insolvency Trustee: is a federally regulated professional who provides financial advice and assist in the bankruptcy process. They are officers of the court who oversee bankruptcy proceedings on behalf of the bankrupt. They are a neutral third party meant to assist debtors and protect creditors rights. While you must pay for their services, they often offer a free consult, and their prices are federally regulated. If the bankrupt can not afford a Licensed Insolvency Trustee (LIT) you may apply to have one appointed for you free of charge.
Creditors: are the parties owed money by the bankrupt. There are three main types of creditors: secured, unsecured and preferred. Creditors participate in meetings and proposals with the LIT and inform the LIT of any irregularities on the part of the debtor.
Bankruptcies are supervised and administered by the Office of the Superintendent of Bankruptcy (OSB) which is a federal agency. The OSB oversees the licensing and monitoring of LIT’s, maintains records of proceedings and enforces standards for the administration of estates.