Meaning
A court injunction restrains a third party from dealing with assets that belong to a defendant but are held in another name. This proxy freezing order targets assets controlled by nominees, family members, or shell companies that have no independent business purpose. It prevents the evasion of justice through the use of sophisticated offshore structures.
Asset Control
The order relies on the principle that the defendant has the ultimate power to direct the disposal of the property. Even if the legal title sits with a proxy, the proxy freezing order stops any transfer if the defendant is the de facto owner. This covers bank accounts, real estate, and shares held through fiduciary arrangements.
Procedural Threshold
Claimants must provide evidence that the third party is acting as a mere agent or tool of the defendant. The court requires a good arguable case that the assets are effectively the property of the main wrongdoer. This prevents the injunction from unfairly interfering with the legitimate business of independent parties.
Enforcement Reach
Banks and professional service providers are served with the order to ensure compliance across different jurisdictions. Because a proxy freezing order binds the third party directly, it stops the movement of capital at the source. This is a vital tool in cross border asset recovery and fraud litigation..
