Legal Question in Bankruptcy in Nevada

Assignment for the Benefit of Creditors

An assignment for benefit of creditors has nothing to do with Bankruptcy. It is simply a way to try to pay a debt with something other than cash. For example, if a business has accounts receivable, they could assign these accounts receivable to a creditor, giving the creditor the right to collect the money owed.

If the business later filed Bankruptcy, the Trustee could take steps to invalidate the assignment for benefit of creditors, especially if it appeared that one creditor was been given a preferential advantage in being paid.