Financial Abuse: What is it and how to spot the warning signs

Financial AbuseFinancial abuse may not be something you have ever considered or thought you would be at risk for. Sadly it is a common tactic used to gain power and control in a relationship and it is worthwhile to consider how in control of your finances and earning capacity you really are.

Women are already at a disadvantage when it comes to income earning. We have greatly reduced salaries to deal with, with the full-time gender pay gap sitting at 17.3%. This equates to a difference of approximately $277.70 per week which is a staggering difference for just being a woman. 

Like all forms of abuse, financial abuse is achieved by subtle and slight manipulation over time. It may appear to be concern or caring with a partner encouraging the woman to work less or give over control of her finances to make life easier for her.

Common strategies used include:

  • Forbidding the victim to work
  • Withholding money
  • Not including the victim in financial decisions
  • Hiding assets

For the full list refer to this article by NNEDV

Financial abuse is all about control and having full autonomy over everything involving money.

Whilst having control over your own money is something I advocate highly, this is the exact opposite. It is when someone else is attempting to take over control of your finances.

Victims of this crime are just that – victims. It can be difficult for them to recognise what is going on and break free of their abuser.

ribj6wvwc38-scott-webbHere are some examples of Financial Abuse:

  1. Mary has lived with her husband John for 20 years, they have 3 children together and John is a successful banker. Mary has never needed to work and has devoted her life to the children and home. John controls all the bank accounts and gives Mary a small “housekeeping” fund each week. When Mary asks about how much money they have saved, John tells her not to worry about it and that she doesn’t have a head for finances to understand the details anyway. When she insists he gets angry and silences her with shouting.
  2. Tammy has been with her boyfriend Dan for 2 years. Dan has been in and out of work, never holding a job longer than a few weeks. Tammy has a blossoming career as a conveyancer. Dan convinces Tammy to take out a loan for him so he can purchase his dream car. He also regularly uses her credit card to fund his online shopping without asking her permission. When the repayments are due Dan has no money to pay them and Tammy is spending most of her wage on his impulse purchases.
  3. Ellen is in her 70s and has 4 children however only 1 lives nearby and it has fallen to her daughter in law, Kerry to take care of her. Despite being of very sound mind Ellen is frail physically and intimidated by Kerry. Kerry convinces her to sell off some of her assets to invest in schemes that supposably will make her rich, but they never do. Kerry has also taken over Ellen’s bank accounts and is pushing to be appointed enduring power of attorney. She regularly withdraws money from Ellen’s bank accounts declaring she is using it for Ellen’s daily needs but is in fact using it for her own purchases.

So, what can you do if someone you know is a victim of financial abuse:

  • Firstly, if you suspect someone is a victim let them know you are there to support them any way they need.
  • Offer to help them access services such as 1800 RESPECT They may not be ready right now to accept your help but make sure they know that your door is open to them.
  • If you believe they are in immediate danger ensure you contact the police straight away

Financial abuse is often accompanied by other forms of abuse but even on its own it is a serious issue. It is vital as a community that we create a culture that says abuse in all its forms is not ok and that responding is everyone’s business.

For more information on financial abuse visit ASIC

Grace Mugabe Financially Empowered

Leave a Reply

Your email address will not be published. Required fields are marked *