When people become bankrupt, control of their property is taken over by either a registered trustee or the Official Trustee, who can sell their property, carry on their business, sue for any debts owed to them and generally take over their financial affairs in order to pay creditors. When a person is made bankrupt, creditors can only deal with the person's trustee in relation to debts incurred before the commencement of the bankruptcy.
Registered trustees are accountants in private practice who are registered by the Inspector-General to act as trustees of bankrupt estates. A person wishing to appoint a registered trustee will first have to obtain that trustee's written consent and file it with the Official Receiver at the same time as lodging their petition in bankruptcy. A registered trustee will generally only act if there is sufficient money or assets to ensure payment of his or her fees. A list of registered trustees is available from the AFSA or their website.
The Official Trustee in Bankruptcy is the trustee of bankrupt estates and is part of the Commonwealth Attorney General's portfolio. Where a person does not nominate a private trustee the Official Trustee will automatically become that person's trustee. If payments are made by the bankrupt towards his or her debts, the Official Trustee will first take its fees and charges and the balance will be paid to creditors. Upon release from bankruptcy, even where no payments have been made, the bankrupt does not owe any fees.
There is one Official Receiver who delegates responsibilities to personnel within AFSA in each State, who act in the name, and on behalf of, the Official Trustee.
The Inspector-General in Bankruptcy has the power to inquire into, and investigate, bankruptcy procedures [Bankruptcy Act 1966 (Cth) s 12]. The Inspector-General who is also the Chief Executive of the Australian Financial Security Authority (formerly ITSA) is responsible for the overall operation of the personal insolvency system and the administration of the Bankruptcy Act. The Australian Financial Security Authority offers a 'one stop service ' on bankruptcy matters where forms can be completed, lodged and information obtained on options of bankruptcy and the alternatives. AFSA also maintains certain other registers and services unrelated to bankruptcy.