Frozen Account Definition

An account which cannot be accessed by withdrawals or deposits is said to be "frozen". Frozen accounts still have a balance and may still accrue interest or penalties, but the balance cannot be utilized. This usually occurs when the account holder fails to make scheduled payments or by some type of legal proceeding against the account holder. For example, during fraud investigations it is possible that the courts would order the suspect’s accounts to be frozen pending the outcome of the legal investigation.