CPLR 5222 Restraining Notice and Bank Levy in New York

Restraining Notice vs. Bank Levy — Two Different Steps

A restraining notice and a bank levy are not the same thing, though creditors frequently confuse them. They are two separate steps in a specific sequence, and you need both.

A CPLR 5222 restraining notice freezes the debtor's bank account. Money cannot be withdrawn, transferred, or spent while the restraint is in effect. But it does not transfer any money to you. It just holds the funds in place.

A CPLR 5232 property execution (the bank levy) is what actually directs the bank to hand over the frozen funds to the enforcement officer, who then pays you after deducting statutory fees.

Think of it as a two-punch sequence: the restraining notice pins the money down, and the property execution takes it.

How to Serve a Restraining Notice

The restraining notice is issued by the court clerk (for self-represented creditors) or by an attorney. It is served on the bank — not on the debtor, at least not initially.

When serving a restraining notice on a financial institution holding a natural person's account, you must include two copies of the CPLR 5222-a Exemption Notice and Exemption Claim Form. This is not optional. A restraining notice served without these forms is defective, and the bank may reject it.

Once the bank receives the restraint:

1. The bank freezes all funds in the debtor's accounts that exceed the EIPA protected floor
2. Within two business days, the bank mails the Exemption Notice and Claim Form to the debtor
3. The debtor has 20 days from mailing to return an exemption claim asserting that the frozen funds are protected
4. If the debtor files a claim, you have 8 days to file a court motion objecting to it
5. If you do not object within 8 days, the bank releases the funds back to the debtor

A restraining notice served on a bank remains effective for one year or until the judgment is satisfied, whichever comes first. Served directly on the debtor (which restricts the debtor from transferring assets), it lasts two years.

The EIPA Floor — Minimum Balance Protection

The bank does not freeze everything. New York's Exempt Income Protection Act automatically shields a minimum balance:

• Downstate (NYC, Long Island, Westchester): $4,080 (240 × $17.00 minimum wage)
• Upstate: $3,840 (240 × $16.00 minimum wage)

If the debtor's account balance is at or below this floor, the bank returns the restraining notice marked "unsatisfied" and does nothing. The account stays untouched.

Accounts receiving direct-deposited government benefits (Social Security, SSI, VA, unemployment) have an additional automatic exemption of up to $3,425 regardless of the total balance.

Executing the Levy

After serving the restraining notice and waiting out the 20-day exemption claim period (assuming no valid claim is filed), the next step is serving a CPLR 5232 property execution through the enforcement officer.

The enforcement officer — a City Marshal in NYC or the County Sheriff elsewhere — serves the execution on the bank. The bank then turns over the frozen, non-exempt funds to the officer. The officer deducts statutory fees (5% poundage under CPLR 8012, plus advance deposits and mileage) and remits the balance to you.

If the bank refuses to comply, or if a dispute arises over account ownership (joint accounts are common), you may need to file a formal turnover proceeding under CPLR 5225 or 5227 — a summary court motion ordering the bank to release the funds.

Common Mistakes That Kill the Levy

Serving the restraining notice without the EIPA exemption forms. The bank rejects it outright.

Not acting promptly after the exemption process. The restraining notice does not collect money — it only restrains the funds for up to one year. Arrange the property execution promptly after the exemption claim process so the frozen, non-exempt funds can be turned over.

Targeting the wrong bank branch. Restraining notices must be served at the branch where the debtor holds accounts. Sending it to corporate headquarters or a random branch may not reach the right department.

Forgetting about joint accounts. If the debtor shares the account with a non-debtor, the non-debtor's funds may be improperly frozen. This invites a turnover proceeding and potential court sanctions.

Our New York Judgment Collection Guide covers the full restraint-to-levy sequence with forms, officer intake checklists, and a timeline tracking the exemption claim deadlines.

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