Directive No. 3

Duties of the Bankrupt to Deliver Credit Cards to the Trustee

Issued:  December 7, 1992

Purpose

The purpose of this Directive is to establish procedures dealing with credit cards.

Background

1. Paragraph 158 (a.1) of the Bankruptcy and Insolvency Act states:
   "A bankrupt shall…, in such circumstances as are specified in directives of the Superintendent, deliver to the trustee, for cancellation, all credit cards issued to and in the possession or control of the bankrupt".

   Policy

2. The trustee shall, as soon as possible, require that the bankrupt deliver to the trustee, for cancellation, all credit cards issued to him/her and in his/her possession or control, except for those cards mentioned in item no. 5 of this Directive, notwithstanding that there may not be any amount outstanding to the issuer of the credit cards.
3. The trustee, after taking delivery of the credit cards referred to in item no. 2 of this Directive, shall immediately cut them up, to prevent further unauthorized use.
4. The trustee shall, as soon as possible, return to the issuer the destroyed credit cards accompanied by a notice of bankruptcy.
5. The bankrupt is not obligated to deliver to the trustee, for cancellation, a credit card in his/her possession and control, where:
   • the credit card was issued to a third party (e.g., employer, spouse, friend, parent); and
   • the trustee has confirmation that the issuer or the third party has authorized the bankrupt to continue to possess and use the card.

The Superintendent of Bankruptcy
George F. Redling

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