What are frozen assets?
submitted by fatima dulcenia dabon

t-diddy

Think of a frozen asset as being opposite of a liquid asset. A liquid asset can be sold, used, given away, etc. A frozen asset cannot be sold or given away because of outstanding debts. The most common reason is that the asset is being used as collateral for the debt.

red

Frozen assets are restricted from being accessed or used. It's usually because of some legal reason. It could be a court orders, unpaid debts, or an investigation.

One example, if someone has a large debt, a court might issue a freeze order to prevent money from being withdrawn or transferred from a bank account.

It's not the same as assets being seized. The money is still left in the bank, but it is not able to be used.

zero

Frozen assets can happen if there’s suspicion of fraudulent activity, money laundering, or some other legal violation. Authorities may freeze assets while they investigate the owner of a bank account. It helps prevent further damage from being done, if the person is in fact guilty of some wrongdoing.

It's meant to protect creditors and other parties until the issue is resolved.

For individuals, it could happen if there's some sort of legal dispute, like inheritance or taxes.

As far as accounting goes, frozen assets are still recorded on the balance sheet, but they can't be used. Once the legal issues are resolved, the freeze is eventually lifted and the assets become fully accessible again.

Shevvy

If a frozen asset can't be used, and a liquid asset can be used, I guess that makes a gaseous asset something that's used too easily, like petty cash.