What does it mean to freeze assets?

Accounting Dec 17, 2020

Expert Solution

Freezing assets means that there is a court order that prevents assets from being disposed of or withdrawn until a legal matter is tied up. If a company has their assets frozen, they will be unable to withdraw cash from accounts and legally prevented from putting up stock, land, or equipment for sale without the court's permission.

Enterprises usually have their assets frozen when there is a concern that they are engaged in illegal activity, and this prevents those under suspicion from taking money and running away.

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