Imagine you suddenly find that you can’t make credit card payments, withdraw money or complete online transfers. You carry out a few checks and realise that your bank account has been frozen. Once the initial shock has passed, you pick yourself up and think about what to do next. In this article, myLIFE explains everything you need to know about frozen accounts and the best way to handle the situation.
Would you like your bank to grant you access to the balance on an account that has been fully or partially frozen? Keep calm and bear in mind that the bank wouldn’t have frozen your account without good reason. The first thing to do is find out why the account was frozen so that you and your adviser can work out a solution together. At this point, we should note that this article doesn’t claim to cover account freezing in exhaustive detail and that the information provided is no substitute for a conversation with your adviser or the most appropriate expert in your specific circumstances. Our aim is simply to help you to identify why your account may have been frozen and to suggest a few steps to take to try to resolve the issue. We should also clarify that this article doesn’t cover bank pledges for start-ups or what happens if an account is frozen as a result of fraudulent or criminal activities.
The first person who may have frozen your account is you. Let’s imagine your ID and bank cards are stolen. If you’re worried that someone could use your account without your permission or try to take money out of it, you can contact the bank or your relationship manager directly and ask for your account to be frozen until the situation is resolved. You can even choose to freeze certain transaction types or channels. For example, you can ask your bank to never accept instructions from you sent by fax or email. Lastly, if your account is dormant (i.e. inactive), the bank gradually implements varying types of freeze (after 3, 5, 9 and 15 years).
Another possible scenario is that one of the people with whom you hold a joint account has revoked joint and several liability. This is not a freeze per se, but in practice it does mean that you won’t be able to conduct any operations whatsoever without the signature of your joint holders.
The account may also be frozen on the initiative of the bank itself or of third parties authorised to request the bank to do so in specific circumstances, such as:
Are you looking to have your account unfrozen as quickly as possible? There is only one solution for temporary freezes: identify and fix the root cause. For example, this might mean:
Contact your adviser for help understanding the situation and working out what can be done about it.
As the saying goes, “prevention is better than cure.” If you want to avoid having your account frozen, sometimes all it takes is a few common-sense habits. For example, always keep an eye on your account balance and pay money in regularly to avoid going into the red. To help you do this, myLIFE regularly publishes content designed to explain how to define and stick to your budget.
If someone passes away, unfortunately there’s nothing you can do but take all of the action that’s required of you and then wait it out patiently until all of the conditions have been met and you can access your account.
In other circumstances, it may be possible to anticipate that your account could be frozen or that your assets could be seized, especially if you have outstanding tax or debts to pay. Are you having trouble paying off a debt? Be as transparent as possible with your creditor and try to find an amicable solution before matters get out of hand. For example, you may be able to stagger your repayments if you’re not able to pay the full amount at once.
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