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#28254 - 08/16/02 11:00 PM Do we freeze the accounts?
JacF Offline

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Joined: Nov 2001
Posts: 6,719
PA
We just heard on the news that one of our depositors has been charged with securities fraud. He has a personal account and a corporate account here. Can/should we freeze either of these accounts, or do we have to wait for writs, levies, attachments, etc to show up?

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#28255 - 08/17/02 02:08 AM Re: Do we freeze the accounts?
Andy_Z Offline
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Andy_Z
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Posts: 27,503
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Why would you take any type of action without a request from some official empowered to do so? Even if you have a loan, there may not be an event of default justifying such action.
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AndyZ CRCM
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#28256 - 08/17/02 12:50 PM Re: Do we freeze the accounts?
A D Virr Offline
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Joined: Oct 2000
Posts: 398
Derry, NH
I agree with Andy. Also, consider the possibility of civil action from your borrower. I remember a case a couple of years ago where a bank in the Northeast reneged on a loan commitment because of a rumor supposedly spread by a loose lipped FBI agent. The plaintiff as I recall received a huge settlement. While the circumstances are not the same - the principle of the matter is. Don't take unilateral action unless you are ordered to do so or if you are exercising your rights because of default.
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Allan D. Virr, CRCM,CRP
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#28257 - 08/18/02 02:39 AM Re: Do we freeze the accounts?
JacF Offline

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Joined: Nov 2001
Posts: 6,719
PA
That's what I was thinking, too. But it's always good to get a second opinion. Thanks, guys.

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