Abuse can take a number of different forms, and it is not always easy to spot. One very common way that a partner might abuse you is through economic abuse. This blog looks at what economic abuse is, and what you can do about it.
What is Economic Abuse?
Economic abuse is defined as behaviour that denies a person economic or financial autonomy according to the Family Violence Protection Act (2008) Vic. It is the threatened or actual behaviour that is coercive, deceptive or unreasonably controlling of another person’s financial independence (or that person’s child) without that person’s consent. It should be said that this definition is currently under review.
Economic abuse often occurs in conjunction with other kinds of physical or emotional abuse. This could include being left with substantial liability and debt, or being excluded from employment.
Economic Abuse may include:
- controlling a partner’s credit cards, bank account and access to money
- withholding, or threatening to withhold, the financial support necessary to meet a person’s reasonable living expenses if that person is dependent on them for financial support to meet those living expenses.
- stopping someone from holding a job or going to school as a means of controlling their ability to be financially independent.
- forcing a partner to incur debts in their name or ruin their credit rating
- changing joint mortgages or bank details without one partner’s consent
For many people in situations of domestic violence, economic abuse can be used as a way to force them to stay in a physically abusive relationship.
Perpetrators can make their victims choose between staying in an abusive relationship or facing financial ruin or homelessness. Frighteningly, as many as 95% of victims of domestic abuse or family violence state that they have also been subjected to economic abuse.
Victims face a huge uphill battle to gain independence even after leaving a situation of economic abuse. They may have little to no ability to earn money independently, and can start from a position of large debt and poor credit.
Economic abuse is unfortunately common in modern relationships, and may become even more prominent when financial interactions happen mostly online. As a family lawyer, I often see clients who have experienced this before their separation, but it also may occur after the couple separates as well. This can be a type of control that an abusive partner is reluctant to let go of.
After a couple separates, perpetrators of economic abuse may continue their control by structuring their finances to minimise child support payments or they may report or estimate a lower income, withdraw money from joint mortgage accounts without their partner’s knowledge, or incur large debts such as traffic and parking fines, even cutting off household utilities without warning.
Economic Abuse is More Common for People with CALD Backgrounds
In Australia, economic abuse can be compounded by race, disability, age and gender. For example, women from Culturally and Linguistically Diverse (CALD) backgrounds may face economic abuse through social isolation, control of immigration status, difficulty in reporting abuse or seeking support, being coerced into signing loan documents, or being prevented from learning English.
Economic Abuse is Rarely Acknowledged
Economic abuse is a prevalent, but rarely recognised form of abuse. Partners, particularly women, are usually in worse off positions financially after leaving an abusive home.
The pandemic has made things harder again for women especially to be financially independent.
A larger number of women work in casual industries and the industries that have faced the most lockdown layoffs, such as retail and hospitality. In addition, more women needed to reduce their working hours to take on the responsibility of homeschooling.
What we would like to see changed
As a family lawyer, I would like to see a number of changes to the way economic abuse is considered in the courts, and to how victims are supported moving forward.
Recommendations to ensure survivors are economically empowered following the breakdown of an abusive relationship are essential to effectively combat all forms of family violence.
Other recommendations include:
- Developing the capacity of professionals such as police, financial services and credit providers such as banks, and utility providers or Centrelink to deal more effectively with economic abuse and help support and educate the people affected;
- Making family violence a ground to apply for financial hardship; and
- Developing an awareness campaign for consumers and credit providers so that they are aware of their rights and responsibilities in regards to family violence.
What can I do if I am being economically abused?
If you are being economically abused, you need to take steps to gain an understanding and control of your financial independence. If you are living with a physically abusive partner and you want to leave, you should start preparing some financial steps as quickly as you can, including:
- Avoid using your credit and debit cards as an abuser can use these to track your whereabouts
- Keep your personal and financial records in a safe place, and leave copies with someone you can trust.
- Keep copies of passwords, keys, extra money and emergency phone numbers in a safe place.
- If you use the internet to explore domestic violence issues or research on how to get out, be careful to hide your search history
- As soon as you can, start to take a financial inventory of what you’re entitled to financially, listing assets and liabilities.
- Start to gather copies of your family’s important records and documents.
- Start to work out what it would cost you to leave the relationship, and try to put aside some of your own money in a safe place.
Economic Abuse after Separation
If you are being financially or economically abused following the breakdown of a relationship one of the first things you can do is secure your bank accounts and limit the redraw function on any joint loan or mortgage accounts.
It is important that you seek legal advice as soon as possible to ensure that the assets of the relationship are secure, and that your legal rights are protected from any other financially abusive behaviour.
If you believe that you are being economically abused by a current or former partner, I may be able to help. Contact me to find out more.