Many people think that Licensed Insolvency Trustees, also known as LIT’s, are just like any ordinary debt advisor or debt consultant however they are a much better choice for debt relief in Ontario. They are debt advisors and debt consultants in the sense that they do give information and advice on debt-related matters, but what distinguishes them from other debt advisors and consultants is that they are the only professionals licensed by the government of Canada through the Office of the Superintendent of Bankruptcy (OSB) to give advice and provide services on debt as well as insolvency-related matters. They have official permission or permit to do it, and as a consumer, a debtor looking for professional help to get out of debt, that’s basically a seal of guarantee that you’re getting advice from a qualified professional and it’s the best advice you can get anywhere in Canada. 

That official authority from the OSB is not given easily. Insolvency trustees are highly trained and educated professionals, most possess solid accounting expertise and have a university degree. All trustees are required to complete a rigorous three-year bankruptcy and law course which gives them extensive knowledge of governing legislation. They must complete mandatory continuing professional development throughout their career to ensure that they continue to be competent in their profession. In addition, they are investigated by the RCMP before being granted a trustee license to ensure that they possess good character and reputation.

Their education and training plus years of experience in their profession empowers them to make recommendations and take various actions adapted to suit individual needs and requirements, whether for individual debtors or businesses. 

Individual consumers and businesses dealing with a Trustee are protected by the fact that:

  • Trustees are regulated by the federal government under the OSB. 
  • They follow a stringent code of ethics and follow federal standards of practice.
  • They are qualified to give financial advice and services in accordance with federal regulations in the Bankruptcy and Insolvency Act. 
  • They will deal with your creditors directly and mediate any dispute you may have.
  • If you have any complaint about dealing with a LIT, you can file a dispute with the OSB and be assured that charges will be reviewed and dealt with accordingly. 


LITs were formerly called Bankruptcy Trustees or Trustees in Bankruptcy. Unfortunately, that old name led to a widely held misperception that trustees can only provide bankruptcy services. Hence, people went to them for help only as an option of last resort, with the thought that filing bankruptcy is the only choice left for them. 

The new directive from the OSB on April 1, 2016, to change the official name to “Licensed Insolvency Trustees,’’ gave consumers a better understanding of the role of the bankruptcy trustee. The new name clearly describes the numerous functions of the trustee and that they can provide a wide range of debt management solutions to individuals and businesses facing debt problems, including debt consolidation, debt management program or DMP and government-regulated insolvency solutions, such as consumer proposals and bankruptcies

LITs can offer the following services:

  • Consumer proposals
  • Business or personal bankruptcy
  • Proposals for businesses
  • Receivership for creditor accounts
  • Monitoring under the Companies’ Creditors Arrangement Act (CCAA)
  • Budget advice
  • Debt consolidation loan advice
  • Debt reduction advice
  • Debt management solutions

Trustees can help you look for solutions to your debt problems. Contrary to a popular myth, not all who go to a trustee end up going bankrupt. On your first consultation, the trustee will provide a thorough assessment of your finances and look over details such as your total liabilities, income, total assets and monthly expenses. By law, they are required to give you all your debt-relief options, which includes debt consolidation, debt management through a DMP or debt settlement program, and filing a consumer proposal or bankruptcy. They may also provide self-administering solutions that will allow you to take control of your spending, such as help you set up a budget as well as offer suggestions to help you deal with your debts on your own, such as what to say and do when contacting creditors directly to make arrangements for paying off credit cards for example.

By helping you evaluate other debt-relief alternatives, you get a second opinion on which program can be the best solution to your financial problems. That second look is crucial, as it gives you another perspective on how to deal with your debts. You may have gone in thinking you’re going bankrupt, but in the end, you may decide to file a consumer proposal instead or maybe take another less drastic debt reduction service if you find it is a better, more affordable alternative to your financial situation.


Licensed insolvency trustees can provide the full range of options to help you find the most appropriate option to get out of debt. In Canada, they are the only debt professionals permitted by law to administer consumer proposals and bankruptcies. Debt consultants, credit counsellors, accountants, and even bankruptcy lawyers cannot provide this service. 

Consumer proposals and bankruptcies are government-regulated insolvency proceedings that provide you with ways to eliminate your debt. 

In a consumer proposal, a legally binding agreement between you and your creditors allows you to settle all your debts for less than you owe. You only repay a percentage of what you owe in a span of five years in exchange for full debt forgiveness. As much as 70% of your debts can be written off if the trustee manages to make a successful negotiation with your creditors. 

In a personal bankruptcy, debts are eliminated when you get a discharge. The discharge releases you from the legal obligation to repay unsecured debts included in your bankruptcy filing. 

In both legal processes, your trustee deals directly with your creditors on your behalf. That representation is beneficial to you as you no longer have to deal with your creditors throughout the process. When you file a consumer proposal, your trustee will negotiate a settlement agreement and disburse your proposal payments. When you file bankruptcy, your trustee will sell and administer your assets and make arrangements with your creditors. 

As Officers of the Court, trustees will aim to seek a solution that is fair and just for both debtors and creditors. They will look out for you and ensure that you get an affordable resolution to your debt problems while ensuring that creditors are treated fairly in accordance with the provisions of the BIA. 


The role of a Trustee is not limited to just bankruptcies. Their job is to give you all your options, weigh out the cost and consequences of each to point you in the right direction so you can have all the information you need to decide which option is best for you and your family.

At Richard Killen & Associates, you can find a local insolvency trustee in any of our offices located across Toronto & the GTA. If your debt problems are keeping you awake at night, and you have collection agencies calling you, or you’re worried about wage garnishments, call one of our licensed insolvency trustees now at 1-888-545-5365 for a free consultation and find out your options to get debt relief.

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    Since 1992, Richard Killen & Associates, a Licensed Insolvency Trustee, have helped thousands of people resolve their financial problems. With 25 years experience in this industry, our president, Richard Killen, and the rest of our team understand the difficulties that honest people can sometimes find themselves in. This expertise makes it possible to provide you with a service that effectively deals with the issues.

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