Frozen Account Law and Legal Definition
An account to which no withdrawal or purchase can be charged is a frozen account. A frozen account shows an account holder’s liability to pay an amount. A creditor can freeze a debtor’s account up to twice the debt. Usually, banks provide notice of freezing to the account holder.
An account is frozen when:
When a person dies, the deceased’s account is frozen until a new lawful owner appears. When there is a dispute regarding the amount in an account, usually the account is frozen until resolution of the legal action.
