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Can Creditors take Money Directly Out of My Account?
Under Canadian law, the money in your bank account(s) is considered an asset. Once a bankruptcy or a consumer proposal has been filed, creditors no longer have direct access to debit your bank account. Having said this, most trustees believe that you should open an account in a bank you have not done business with previously before you declare bankruptcy. This is because human and computer errors do happen and you might find that a creditor has been able to debit money from your account, even though this is not supposed to happen.
Also, any money that is deemed to be surplus to your living needs (the Court uses a formula that takes size of family, cost of living, etc. into account) will need to be surrendered to the trustee for distribution to creditors.
IN THIS SECTION
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