Economic Financial Abuse: The Invisible Chain
Posted on 22nd May 2024 at 13:20
Economic financial abuse is a sinister and often overlooked form of abuse where one partner controls the other's access to financial resources, stripping away their independence and self-worth. Unlike physical abuse, the scars of financial abuse are not visible, but the damage is profound. The long-lasting effects on credit scores really can change your life but there is also the emotional trauma this can leave someone with. Absolutely Devastating.
What is Economic Financial Abuse?
Economic financial abuse involves a range of behaviors designed to control a person’s ability to acquire, use, and maintain financial resources. This can include controlling finances, restricting access to money, preventing a partner from working, or stealing their money. The goal is clear: to make the victim financially dependent and powerless.
The Stark Reality
Statistics paint a grim picture. According to the National Network to End Domestic Violence (NNEDV), up to 99% of domestic violence cases include some form of financial abuse. This abuse is a major reason why victims stay in or return to abusive relationships. Financial insecurity is a powerful tool of control.
The impact is staggering:
The average financial abuse victim lost £4,000 pre Covid and £27,000 post Covid, using at least 9 different creditors.
2.3 million adults aged 16 to 74 experienced domestic abuse which is approximately 16% of adults in the UK.
Aviva’s research said men were more likely to admit being victims than women.
Nearly 50% of financial abuse victims have debts put in their name by the abuser, ruining their credit scores.
Victims often lose thousands annually in lost wages due to work sabotage by their abuser, based on a study by the Institute for Women's Policy Research.
Recognising the Signs
Financial abuse can be subtle, making it essential to recognise the signs:
Control over finances: abusers often take full control of all financial matters, including bank accounts, credit cards, and investments. Victims may be given an "allowance" and must account for every penny spent.
Preventing employment: abusers may sabotage their partner’s job prospects by refusing to let them work, interfering with their job, or creating situations that force them to leave work.
Restricting access to money: this includes not allowing the victim access to their own bank accounts or forcing them to ask for money.
Accumulating debt in the victim’s name: abusers may take out credit cards, loans, or other financial commitments in the victim’s name, ruining their credit score and financial reputation.
Stealing or forcing financial decisions: this can involve stealing the victim’s money, forcing them to sign financial documents, or manipulating them into financial decisions that are detrimental.
The Devastating Impact
The consequences of financial abuse are long-lasting. Victims often face ruined credit scores, mountains of debt, and a lack of job skills or employment history. This financial instability can trap victims in abusive relationships and make it incredibly difficult for them to rebuild their lives even after they leave.
We heard from a very inspiring financial abuse survivor Rosie Lyon at a local event with WSP Solicitors. Her case was so awful to hear about and the length of time it took to recover from this and rebuild her life. Rosie survived this like an absolute trooper and is now making such a positive contribution to her workplace and the world by using all of this trauma by becoming a vulnerability specialist. Not only this, she’s also the winner of the Young Banker of the Year Worldwide 2021.
She has been working in the banking industry for nearly 8 years, and is passionate about creating a fairer and financial future for survivors of domestic abuse. Rosie is also a public speaker, a volunteer, and a mentor for women in the banking industry. She was truly inspiring and a pleasure to meet, just proving there is light at the end of the tunnel for financial abuse victims.
Taking Action
If you or someone you know is experiencing financial abuse, there are steps to take:
Reach out for help: contact local domestic violence shelters, hotlines, or financial abuse resources. They can provide immediate assistance and long-term support.
Secure important documents: gather and secure essential documents such as identification, financial records, and legal papers.
Open a separate bank account: if safe to do so, open a bank account in your name to start saving money independently.
Build a support network: connect with trusted friends, family, or support groups who can offer emotional and practical support.
Local support groups include:
Economic financial abuse is such an emotive subject and many people suffer in silence or don’t even know this is happening to them.
At PBT Accountancy, we really get to know our clients and their financial habits and we are always on the lookout for red flags.
We have also signed up to the Financial Vulnerability Charter. By committing to the Charter, we are committing to use our best endeavours to provide you with a service that recognises your unique circumstances and delivers the same outcomes that you would expect if you were not in vulnerable circumstances.
Recognising the signs and understanding the profound impact it has, we can better support victims and work towards eradicating this form of abuse. If you or someone you know is in this situation, remember that help is available, and taking the first step towards financial independence is possible.
Why not let us help you?
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