What is an 'Account Freeze'

An account freeze is an action taken by a bank or brokerage that prevents any transactions from occurring in the account. Typically, any open transactions will be cancelled, and checks presented on a frozen account will not be honored.

Account freezes can be initiated by either the account holder or a third party.

BREAKING DOWN 'Account Freeze'

An account may be frozen by government or regulatory authorities because of suspicious activity, suspected criminal activity, civil actions or liens filed against the account. Furthermore, a bank or brokerage account may be frozen when the account holder dies. Once the appropriate documentation is presented, a new account will be opened in the beneficiary's name with access to the assets.

RELATED TERMS
  1. Frozen Account

    A frozen account is an account to which no withdrawals or purchases ...
  2. Account Activity

    A banking term that refers to any activity that creates a debit ...
  3. Account Hold

    Deposits that are delayed before being credited to an account, ...
  4. Credit Freeze

    A credit freeze, also called “security freeze,” is a freeze on ...
  5. Future Dating

    Crediting a bank account to which the funds will be made available ...
  6. Accounting Event

    A transaction or change recognized on the financial statements ...
Related Articles
  1. Investing

    A Guide to Bank Accounts

    Find out which type of bank account suits your specific needs.
  2. Trading

    Pick the Right Brokerage Account for Options Trading

    Follow these steps to pick the right options brokerage account depending on your trading needs and style of trading.
  3. Personal Finance

    What is an Account Balance?

    An account balance represents the total amount of money in a financial account at any given moment.
  4. Small Business

    Best Checking Accounts For Small Businesses

    What you need to know to choose the best checking account for your small business – and where to look.
  5. Investing

    Opening Your First Brokerage Account

    Learn what steps you should take before you open your first brokerage account.
  6. Investing

    Money Market Accounts vs. Savings Accounts

    An interest-bearing account that pays a higher interest rate than a savings account and gives the account holder limited check-writing ability.
  7. Personal Finance

    Handling High-Yield Savings Accounts

    Is this the savings route for you? Read on to find out what these accounts have to offer.
  8. Personal Finance

    Accountant: Job Description & Average Salary

    Discover what the job description of an accountant entails, along with education and training, salary and skills necessary for success.
  9. Retirement

    America's Frozen Pension Dilemma

    Unfortunately, there are several factors that have eroded the presence of pension plans in America, and workers need to be prepared to replace that expected income for their retirement years. ...
RELATED FAQS
  1. If a person's account is frozen, which of the following activities is allowed ... ...

    The correct answer is a A frozen account does not mean that the person can not trade, it means that transactions must be ... Read Answer >>
  2. How do you calculate payback period using Excel?

    Understand the various fees that can be assessed on a personal or business checking account, and learn methods to avoid being ... Read Answer >>
Hot Definitions
  1. Retirement Planning

    Retirement planning is the process of determining retirement income goals and the actions and decisions necessary to achieve ...
  2. Drawdown

    The peak-to-trough decline during a specific record period of an investment, fund or commodity. A drawdown is usually quoted ...
  3. Inverse Transaction

    A transaction that can cancel out a forward contract that has the same value date.
  4. Redemption

    The return of an investor's principal in a fixed income security, such as a preferred stock or bond; or the sale of units ...
  5. Solvency

    The ability of a company to meet its long-term financial obligations. Solvency is essential to staying in business, but a ...
  6. Dilution

    A reduction in the ownership percentage of a share of stock caused by the issuance of new stock. Dilution can also occur ...
Trading Center