California’s Freeze and Seize Law – Penal Code 186.11 PC
Understanding California’s Freeze and Seize Law – Penal Code 186.11 PC
California’s “Freeze and Seize” law, outlined in Penal Code 186.11, allows prosecutors to freeze a defendant’s assets before trial in major white collar crime cases. The law applies when someone is charged with multiple felony offenses involving fraud or embezzlement and the total alleged loss exceeds $100,000.
In other words, if you are charged and later convicted of two or more related felonies involving significant financial loss, the law imposes an automatic sentencing enhancement. This means additional prison time and the government’s authority to seize your assets to pay court fines and restitution to victims.
Courts can issue restraining orders early in the case—before any conviction—to prevent assets from being hidden, transferred, or depleted. Prosecutors often use these freeze orders in high-dollar fraud investigations to preserve funds for eventual recovery.
Who Does California’s Freeze and Seize Law Apply To?
Penal Code 186.11 PC provides a sentencing enhancement and asset preservation mechanism in cases involving large-scale financial fraud or embezzlement. To trigger this law, a person must:
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Be convicted of two or more related felony offenses in a single case;
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The offenses must involve fraud or embezzlement as a material element; and
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The conduct must result in a financial loss of more than $100,000.
The statute refers to these cases as involving a “pattern of related felony conduct,” meaning the crimes share a common purpose, method, or victim, or are otherwise connected by specific facts. These cases are not isolated acts but part of a broader fraudulent scheme.
Additional Sentencing Enhancements Under PC 186.11
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For losses exceeding $500,000: An additional 2, 3, or 5 years in state prison.
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For losses between $100,000 and $500,000: Additional prison time may apply under Penal Code 12022.6, which provides enhancements for high-value economic crimes.
This enhancement is in addition to the punishment for the underlying offenses and may only be imposed once per criminal proceeding.
Asset Freezes and Pretrial Restraining Orders
Under Penal Code 186.11, prosecutors may seek court orders to freeze a defendant’s assets before trial when the charges involve fraud or embezzlement with alleged losses exceeding $100,000. These pretrial restraining orders are designed to preserve property for the payment of restitution and fines if a conviction occurs.
The court may freeze or place restrictions on the following types of property:
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Real estate holdings
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Bank accounts and financial assets
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Investment portfolios
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Vehicles and other titled assets
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Business equipment or ownership interests
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Property transferred to third parties (unless transferred in a bona fide sale)
Importantly, these restraining orders may be issued based solely on probable cause and do not require a conviction. The prosecuting agency may request additional measures, such as the appointment of a court-approved receiver to manage the assets or operate a business to prevent asset dissipation during the proceedings.
How California Freeze and Seize Orders Are Filed and Enforced
To initiate a Freeze and Seize action, the prosecution must file a formal petition with the criminal division of the superior court. This petition outlines the felony charges, the alleged financial loss, and identifies the specific assets the state seeks to restrain before trial.
The process generally follows these steps:
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Filing of Petition: The prosecuting agency submits a petition requesting protective orders over specific assets.
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Notice to Interested Parties: Individuals or entities with a potential legal interest in the affected property must be notified, either by personal service or registered mail.
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Pretrial Hearing: A court hearing may be held to determine whether the restraining order or asset freeze should remain in effect pending the outcome of the case.
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Evidentiary Standard: The court may rely on sworn declarations, hearsay, or other evidence to assess the risk that assets may be hidden, transferred, or dissipated.
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Lis Pendens Filing: To preserve real property, a lis pendens may be recorded with the county recorder, placing a legal hold on real estate transactions.
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Bank Disclosures: Financial institutions may be compelled to disclose account numbers, balances, and transaction history to identify assets linked to the defendant.
This process can begin shortly after charges are filed—well before any conviction—and is focused on ensuring that restitution and fines can be recovered if the case results in a guilty verdict.
What Happens to Frozen Assets After a White Collar Conviction?
If the defendant is convicted of two or more related felonies involving fraud or embezzlement, and the court has issued a pretrial freeze order under Penal Code 186.11, the court may proceed to enforce the seizure of assets to satisfy financial penalties and restitution.
Upon conviction, the court may:
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Order Liquidation of Property: Assets that were frozen pretrial may be sold or liquidated to cover fines and restitution.
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Appoint a Receiver: A court-appointed receiver may be tasked with managing and distributing the seized assets.
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Impose Restitution as a Condition of Probation: The court may require restitution payments to victims as a formal condition of probation. In some cases, probation can be extended up to 10 years to ensure full payment.
The funds recovered through liquidation are distributed in a specific order of priority:
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Payment of Receiver’s Fees and Administrative Costs
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Satisfaction of Valid Liens or Secured Interests
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Restitution to Victims of the Fraud or Embezzlement
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Payment of Court-Imposed Fines
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Remaining Funds to the Restitution Fund or Insurance Fund (as applicable)
If the total value of assets is not enough to satisfy all obligations, the court must equitably distribute the remaining proceeds—but by law, no less than 70% must be allocated to victim restitution.
How to Challenge a Freeze and Seize Order in California
Yes. California law allows defendants or third parties with a legal interest in frozen assets to challenge a freeze order. These proceedings serve as an important safeguard against overreach and ensure that property is not unjustly restrained.
A defendant or interested party may:
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File a Verified Claim of Interest: Anyone asserting a legal right to the frozen property can file a verified claim with the court explaining the nature and amount of their interest.
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Request a Hearing: Upon filing a claim, the court must hold a hearing—typically within 10 days—to determine whether the freeze should remain in effect or be modified.
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Seek Release of Funds: The court may release a portion of the frozen assets to cover the defendant’s reasonable legal fees or necessary living expenses.
When reviewing challenges, the court considers several factors, including:
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Whether there is a risk that the assets will be dissipated or hidden.
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Whether maintaining the freeze is necessary to preserve restitution or fine payments.
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Whether releasing funds is appropriate in the interest of justice, particularly to ensure access to legal representation and basic living needs.
Charged with Fraud or Embezzlement in California? Speak with a Los Angeles Criminal Defense Attorney Today
If you’re facing fraud, embezzlement, or other white collar crime charges in California involving alleged losses over $100,000, the consequences can extend far beyond prison time. Under Penal Code 186.11, prosecutors may freeze your assets before trial, seize your property after conviction, and pursue extended prison terms and steep financial penalties.
Attorney Hashemi is a Los Angeles criminal defense attorney with over 20 years of experience defending clients in high-stakes financial crime cases—including those involving asset freezes and restitution demands. He understands how prosecutors use California’s Freeze and Seize Law and knows how to fight back: whether by challenging restraining orders, negotiating charge reductions, or protecting your right to legal funds and due process.
If you’ve been charged in Los Angeles or are under investigation in connection with a financial crime, don’t wait for your assets to be frozen or forfeited. Get legal advice now.
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