The Office of the U. S. Trustee was established by Congress in the Bankruptcy Reform Act of 1978. It was intended to help regulate or supervise certain aspects of the bankruptcy process. Congress makes policy decisions by passing laws; the Executive supervises the enforcement of laws passed by Congress. The US Trustee was created as a division of the US Department of Justice, part of the Executive branch of government.
The US Trustee program consists of the Executive Office for U. S. Trustees (EOUST) which is located in Washington, DC; the regional offices located around the country; and the field offices located in each region. There are 21 regions covered by the US Trustee program, these offices cover all Federal Judicial Districts except for the districts in which Alabama and North Carolina are located. The exemption of those two states was a political decision made at the time the original legislation was enacted. Each of the US Trustee regions has a central office and one or more field offices. At present, there are 95 field offices of the U. S. Trustee program.
While the U.S. Trustee, Assistant Trustee and their employees work for the government, specifically the Department of Justice. Their positions are mostly paid for from fees collected in large bankruptcy cases. Their primary job is to supervise the independent trustees appointed to manage individual bankruptcy cases.
According to the a U.S. Department of Justice website, other duties of the U.S. Trustee are taking legal action to enforce the provisions of the Bankruptcy Code and to prevent fraud and abuse, referring matters for investigation and criminal prosecution where appropriate, ensuring that estates are administered efficiently and fees are reasonable, appointing and convening creditor’s committees in Chapter 11 reorganization cases, reviewing disclosure statements and applications for the retention of professionals, and advocating matters relating to the Bankruptcy Code and rules of procedure in court.
Examples of U.S. Trustee involvement in consumer cases are objections to confirmation of Chapter 13 plans on grounds of unfair discrimination among creditors; motions to dismiss a case because of concealment of assets or income; and motions to dismiss Chapter 7 cases in that come within their guidelines for abuse. It is these motions to dismiss for abuse that are most common in the consumer bankruptcy context. Bankruptcy Law Network member Karen Oaks answers the question “What Does the U. S. Trustee Do?” in an article on that useful website.