Restraining Notices and Bank Levies

Freezing a debtor's bank account is one of the most effective ways to collect a judgment in New York. Money in a bank cannot be hidden the way other assets can, and a frozen account often brings the debtor to the table quickly. Call 212-233-1233 to put a restraining notice to work on your judgment.

The Restraining Notice

Under CPLR 5222, a judgment creditor can serve a restraining notice on a bank holding the debtor's funds. Once served, the bank must freeze the debtor's account up to twice the amount of the judgment. The debtor cannot withdraw or transfer the restrained funds. A restraining notice can also be served directly on the debtor, prohibiting the debtor from disposing of property.

The Levy and Seizure

A restraining notice freezes the money, but a levy is what actually moves it to you. We direct a New York City marshal or a county sheriff to levy on the frozen account by serving an execution on the bank. The bank then turns the funds over to the marshal, who remits them to you after deducting the statutory fee. The marshal's poundage fee, typically five percent, is added to what is collected from the debtor.

Finding the Right Bank

To restrain an account you generally need to know where the debtor banks. We identify the debtor's bank through information subpoenas and review of the debtor's prior payments to you, such as checks the debtor wrote in the past. A check the debtor once sent you can reveal exactly where to serve the restraint.

Exemptions

New York law protects certain funds from seizure, including specified amounts of statutorily exempt money such as Social Security, unemployment, and other public benefits, and a baseline amount of wages already deposited. We take these exemptions into account so the levy is effective and proper, and we respond to any exemption claim the debtor raises.

Acting Quickly and Repeatedly

Bank balances fluctuate. A restraint served the day after payroll or a large deposit captures far more than one served when the account is empty. Timing matters, and a restraining notice can be served more than once as new funds come in. We use the debtor's payment patterns to choose the right moment.

To freeze and collect a debtor's bank account, call 212-233-1233 or email [email protected].