diff --git a/README.md b/README.md
index 041f135b..4bda3939 100644
--- a/README.md
+++ b/README.md
@@ -38,7 +38,7 @@ fn cancel(env: Env, caller: Address) -> Result<(), Error>
 fn pause(env: Env, caller: Address) -> Result<(), Error>
 fn resume(env: Env, caller: Address) -> Result<(), Error>
 fn top_up(env: Env, caller: Address, amount: i128) -> Result<(), Error>
-fn clawback(env: Env, caller: Address) -> Result<i128, Error>
+fn clawback(env: Env, caller: Address) -> Result<i128, Error> // rejected while paused; resume() first
 
 // Extend end_time by extra_time_seconds, pulling the exact rate-implied deposit from the sender
 fn extend_duration(env: Env, caller: Address, extra_time_seconds: u64) -> Result<(), Error>
diff --git a/contracts/stream/src/lib.rs b/contracts/stream/src/lib.rs
index 4264d8c4..06a29df9 100644
--- a/contracts/stream/src/lib.rs
+++ b/contracts/stream/src/lib.rs
@@ -498,6 +498,10 @@ impl DripStream {
     }
 
     /// Sender reclaims unstreamed tokens (only if clawback was enabled).
+    ///
+    /// A paused stream must be resumed before clawback is allowed; otherwise the
+    /// sender could freeze accrual and immediately drain the remaining principal
+    /// while the recipient is effectively blocked from earning any more funds.
     pub fn clawback(env: Env, caller: Address) -> Result<i128, Error> {
         state::with_guard(&env, |env| Self::_clawback(env, &caller))
     }
@@ -507,6 +511,9 @@ impl DripStream {
 
         let info = state::load(env);
         state::assert_not_cancelled(&info)?;
+        if info.is_paused() {
+            return Err(Error::NotPaused);
+        }
         if !info.is_clawback_enabled() {
             return Err(Error::ClawbackDisabled);
         }
diff --git a/docs/security.md b/docs/security.md
index 007e7488..3a5c860f 100644
--- a/docs/security.md
+++ b/docs/security.md
@@ -84,7 +84,7 @@ A malicious sender pausing a stream indefinitely, blocking further accrual for t
 
 A sender with `clawback_enabled = true` can call `clawback()` to reclaim all unstreamed tokens at any time, effectively starving the recipient of future payments. Recipients should verify `clawback_enabled` before accepting a stream.
 
-**Mitigation:** The app should display a prominent warning when `clawback_enabled = true`. Consider requiring recipient acknowledgement before stream activation.
+**Mitigation:** The app should display a prominent warning when `clawback_enabled = true`. Additionally, the protocol blocks `clawback()` while a stream is paused; the sender must `resume()` before reclaiming any unstreamed balance. Consider requiring recipient acknowledgement before stream activation.
 
 ---
 
diff --git a/tests/stream_clawback.rs b/tests/stream_clawback.rs
index fa73fc15..47cbf797 100644
--- a/tests/stream_clawback.rs
+++ b/tests/stream_clawback.rs
@@ -168,25 +168,18 @@ fn clawback_on_cancelled_stream_is_rejected() {
 // ── Paused stream clawback ───────────────────────────────────────────────────
 
 #[test]
-fn clawback_while_paused_uses_paused_timestamp() {
+fn clawback_while_paused_is_rejected() {
     let env = base_env();
     let sender = Address::generate(&env);
     let recipient = Address::generate(&env);
 
-    let (client, token_addr) =
-        deploy_stream_with_clawback(&env, &sender, &recipient, 1_000, 3_600, true);
-    let tok = token::Client::new(&env, &token_addr);
+    let (client, _) = deploy_stream_with_clawback(&env, &sender, &recipient, 1_000, 3_600, true);
 
-    advance(&env, 300); // 300_000 streamed at pause point
+    advance(&env, 300);
     client.pause(&sender);
-    advance(&env, 500); // paused — no additional accrual
 
-    // Owed = 300_000; unstreamed = 3_300_000
-    let sender_before = tok.balance(&sender);
-    let reclaimed = client.clawback(&sender);
-
-    assert_eq!(reclaimed, 3_300_000);
-    assert_eq!(tok.balance(&sender) - sender_before, 3_300_000);
+    let result = client.try_clawback(&sender);
+    assert_eq!(result, Err(Ok(Error::NotPaused)));
 }
 
 // ── Clawback enabled view function ───────────────────────────────────────────