No one will know and here’s why. Canadian bankruptcy privacy laws
Canadian bankruptcy privacy laws – There is a great fear of most of the people who file bankruptcy that friends or family will find out. In fact, unless you are a prominent person no one will know you filed bankruptcy.
I will never forget a couple who came to see me about bankruptcy a few years ago. I will call them John and Mary Smith. I spend about an hour with them. They decided that they would file bankruptcy as soon as possible. Near the end of the interview I informed them that no one would know that they filed bankruptcy except their creditors. The gentleman smiled at me and said: “Please excuse me for a minute. I’ll be right back.”
He was back in about five minutes. He had a copy of the local paper with him. He laid it out before me and I saw the headline on the 3rd page: “JOHN SMITH WILL FILE PERSONAL BANKRUPTCY IN THE NEXT FEW DAYS.”
I looked up at them in embarrassment. They both had huge grins on their faces. “Not to worry!” they said: “We know how this works.”
In spite of my faux pas I will repeat, unless you are a prominent person no one will know you filed bankruptcy except your creditors.
Canadian bankruptcy privacy laws – The reason no one will know you filed are for the following reasons:
For Summary Administration Bankruptcies (the vast majority of bankruptcies filed) there is no legal notice published in the newspapers;
Except for Alberta a court file is not opened when a person files bankruptcy;
Trustees respect and honour Canadian privacy laws;
Trustees will not inform your employer unless they must in order to stop a wage garnishee.
Trustees are so conscientious of privacy that any mail sent to you does not have the name “trustee” on the return address of the envelope so even your mailman will not know.
Worries about debt keeping you up at night? We understand what you are up against better than anyone.