It’s not a good idea. They have access to your site, and if they have done their job properly and it is well promoted, should be earning you revenue through sales or referals, and at least be placed in front of your customers eyevalls. If you try to screw your web designer, bad things like this can happen.
Designers: ALWAYS take a minimum 33% upfront, long before you ever fire up Photoshop or write a single line of HTML. If you are a professional, then you are worth it. That is how the business works. Collect the remainder of the fees upon delivery.