How to Protect Money After a Lawsuit

What Happens After Getting a Judgment Against You?

When one party to a lawsuit is awarded a money judgment against the other party in Florida, the presiding judge is not going to write a check to the prevailing party. In some cases, the losing party voluntarily pays the judgment. In other instances, the losing party is either unable or unwilling to pay. In those those cases, the prevailing party—the judgment creditormust take steps to collect the money from the judgment debtor. The lawsuit loser—the debtor—tries to resist payment and make it difficult for the winner to collect the judgment. Judgment debtors need legal advice about how they may protect money after losing a lawsuit.

The first thing to understand is what legal tools a creditor will likely use to collect money.


One of the first tools a judgment creditor uses to collect money from a judgment debtor (or someone that has lost a lawsuit) is called a financial account garnishment. Almost all states enable a judgment creditor to serve a writ of garnishment on your banking institution or your stockbroker without giving prior notice to the debtor account owner. Upon receipt of the garnishment writ, the bank will freeze all the debtor’s bank accounts.

The bank has a time period provided by law to file with the applicable court a response stating what accounts the debtor owns, or shares ownership in, and how much money was in each account on the day the garnishment was served. Most states exempt money from certain, and the garnishment statutes also give the debtor a chance to state a claim of exemption or other legal defenses to the garnishment. For example, money deposited from social security is exempt from garnishment, and many states exempt retirement plan proceeds held in bank accounts.

Frozen Funds

How to protect money after a lawsuit in FloridaUpon receipt of a garnishment writ, most banks will freeze any and all accounts where the judgment debtor is owner or co-owner. Even if the debtor has possible defenses or exemptions, all his accounts remain frozen while he asserts his defenses in court proceedings. After a bank garnishment, a debtor may find himself with no available money to pay living expenses or even pay his own attorneys.

Bank garnishments often deprive judgment debtors’ access to a substantial amount of their liquid assets without notice.

How Does a Creditor Know Where You Have Money?

Florida law provides creditors certain tools to discover where a debtor may maintain bank accounts and other financial accounts. These tools include inspection of the debtor’s tax records, financial records, and the debtor’s own testimony under oath. There also are services that search national banking records to discover a debtor’s banking history.

Hiding Money from Garnishment

Hiding money is never a good asset protection strategy. A creditor has several methods of forcing you to answer questions under oath about your accounts, your cash, and any source of money that you have for support. A creditor may simply ask you to identify all your financial accounts wherever located or identify any person or company with possession of your assets. If you answer questions untruthfully or provide incomplete answers you may be committing perjury. Not only do false and misleading descriptions under oath expose you to additional sanctions or criminal liability, your evasive answers will undermine your credibility in subsequent court proceedings.

Offshore Accounts

Many attorneys advise clients to protect their liquid money from possible bank garnishments by opening offshore bank accounts that are not subject to U.S. garnishment statutes and writs. U.S. citizens no longer can open accounts in their individual name become of international anti-terrorism rules. Offshore accounts can only be established through newly formed asset protection entities such as offshore trusts or offshore limited liability companies set up through attorneys.

These offshore arrangements have disadvantages. First, offshore entities and banking is complicated and expensive, and control over these entities and their bank accounts must be relinquished to offshore trustees and managers to be effective asset protection. Transfer of funds to offshore entities are subject to attack as fraudulent conveyances under the fraudulent transfer statutes and laws enacted in every state.

Fortunately, there may still be effective ways to protect bank accounts from garnishment. For example, there are bank accounts in the U.S. that cannot be garnished in most cases. These banks shield you from garnishment without the expense and complications of offshore banking.

What to Do Next

We help individuals and businesses develop and implement a customized asset protection plan to protect your wealth from creditor collection.
Contact us to get started through our contact page or by calling our office at (407) 444-0404.
Alper Law
How to Protect Money After a Lawsuit
August 2, 2016