Assignment for the Benefit of Creditors

An Assignment for the Benefit of Creditors (ABC) is a legal process where a financially troubled individual or business voluntarily transfers their assets to a trusted third party, known as an assignee. This assignee manages the assets and distributes the proceeds to creditors to settle debts, often outside of bankruptcy court. The goal is to achieve a fair resolution for creditors while allowing the debtor to avoid the complexities and public nature of bankruptcy proceedings. It’s a way to handle debt responsibly and efficiently, promoting a smoother transition for the debtor and potential recovery for creditors.