How to Spot and Stop Financial Abuse in Australia

Financial abuse is an insidious form of control that is less noticeable than physical abuse, but every bit as damaging. In Australia, financial abuse is a growing concern, and it can happen in various relationships — between intimate partners, family members, or even within workplaces.

Whether you or someone you know is a victim, it’s important to know that financial abuse can be stopped, and support is available. And, just as importantly, you need to be willing to step in and do your part to help when you see it.

What is Financial Abuse?

Financial abuse occurs when someone uses their access to money as a means of exerting power and control over another person. It often involves tactics like restricting another person’s access to money, coercing financial decisions, and exploiting the victim’s resources.

Though it’s not always visible, the abuse can manifest in various ways, such as preventing someone from working, controlling their income, or forcing them to take on debt.

Examples of Financial Abuse:

• Controlling finances: One partner controls all the finances, including access to bank accounts, credit cards, or savings. 

• Coercing financial decisions: Forcing or pressuring someone into making financial decisions that benefit the abuser (e.g., taking out loans, signing contracts). 

• Withholding money: Denying a person access to money, even for basic needs such as food or transportation. 

• Misuse of funds: Stealing from the victim or mismanaging their finances without their consent.

Creating financial dependence: Making the victim reliant on the abuser for financial support or making it impossible for them to become financially independent.

Signs of Financial Abuse

Spotting financial abuse early is critical to stopping it before it causes lasting harm. While the signs may vary depending on the nature of the abuse, some common red flags include:

1. Lack of Control Over Personal Finances

If a person doesn’t have control over their own income or assets, this could be a sign of financial abuse. They may:

• Not have access to their bank account, even if they are the primary earner.
• Be required to ask for money for even basic needs or large purchases.
• Not be able to make financial decisions, even regarding their own earnings or savings.

2. Frequent Financial Hardship

Someone who is experiencing financial abuse may constantly face financial struggles despite earning an income. This could involve:

• Being regularly asked for money or being forced to cover the abuser’s expenses.
• Inability to pay bills or a sudden increase in debt without a clear explanation.
• Sudden and unexplained financial loss, like missing savings or money from joint accounts.

3. Pressure to Sign Financial Documents

An abuser may push their victim into signing documents without fully understanding the consequences. This could include:

• Signing loans or contracts that the victim doesn’t want or need.
• Taking out credit or loans in the victim’s name without their consent.
• Agreeing to financial arrangements under duress or threat.

4. Isolation from Financial Independence

Abusers often try to isolate their victims, making it difficult for them to earn their own income or access financial resources. This might look like:

• Preventing the victim from working, or limiting their ability to do so by controlling childcare, transport, or opportunities.
• Pressuring the victim to quit their job, or limiting their employment prospects.
• Keeping the victim isolated from family and friends, who may offer financial support or advice.

5. Blame and Guilt Over Financial Problems

Financial abusers often use guilt and shame as tools of manipulation. The victim might feel:

• Blamed for any financial problems, even if they are not at fault.
• Pressured to make up for any financial mistakes, even when they are caused by the abuser’s actions.

Isolated from others because the abuser makes them feel responsible for the situation.

How to Stop Financial Abuse

Stopping financial abuse can be difficult, but it’s important to take action to regain control over your life and finances. Here are some steps to take:

1. Recognise the Abuse and Seek Help

The first step in stopping financial abuse is recognising that it is happening. If you or someone you know is showing signs of financial abuse, the next step is to reach out for support:

• Talk to a trusted friend or family member: Confide in someone you trust who can offer advice and emotional support.
• Seek professional help: Consider speaking to a financial counsellor, domestic violence support group, or legal professional. In Australia, services such as MoneyCare and Financial Counselling Australia can provide advice on how to navigate financial abuse.
• Contact helplines: If you feel unsafe, don’t hesitate to contact domestic violence helplines, such as 1800RESPECT (1800 737 732), for confidential support.

2. Gain Control Over Your Finances

If possible, begin to regain control over your finances. Some practical steps may include:

• Open a separate bank account: If you don’t already have one, open an account that is solely in your name. Ensure that it’s not accessible to the abuser.
• Start saving small amounts: Even if it’s just a small amount, start setting aside money for emergencies.
• Keep financial records: Document your finances, including income, debts, and savings, so you have a clear picture of your financial situation.

3. Establish a Safety Plan

If the financial abuse is part of a larger pattern of domestic violence, it’s important to have a safety plan. This can include:

• Securing a safe place to go in case of emergency, whether it’s a friend’s house or a shelter.
• Having access to emergency funds or a credit card that the abuser cannot access.
• Protecting important documents like identification, bank statements, and legal papers. Keep these in a safe, secure location.

4. Legal Protections in Australia

In Australia, there are legal protections available for victims of financial abuse, especially in the context of domestic violence. These can include:

• Domestic Violence Orders (DVOs): A court order can restrict the abuser’s access to financial resources or prevent them from controlling the victim’s finances.
• Seeking compensation or restitution: In some cases, victims of financial abuse may be able to recover lost funds or assets through legal action.
• Support from financial counsellors: Financial counsellors can help you navigate debts or reclaim assets that were misappropriated.

5. Create Boundaries Around Financial Requests

If the abuser is continually asking for money, creating clear boundaries is important:

• Politely but firmly refuse to lend money or take on unreasonable financial obligations.
• Set limits on any financial assistance you may offer, making sure it doesn’t compromise your financial well-being.
• Don’t feel guilty for setting boundaries — it’s important to protect your financial security.

In short, recognising the signs of financial abuse and taking steps to regain control over your finances is crucial for your independence and well-being. If you or someone you know is experiencing financial abuse, remember that help is available, and please don’t hesitate to make use of the professionals, legal protections, and support services that are available to you. If you need help, contact your local professionals – for example, your local financial planning services – and get the process started as soon as possible.

Important information – Oracle Advisory Group makes no representation or warranties as to the accuracy or completeness of any statement in it including, without limitation, any forecasts. The information in this document is general information only and is not based on the objectives, financial situation or needs of any particular investor. An investor should, before making any investment decisions, consider the appropriateness of the information in this document, and seek their own professional advice. Past performance is not a reliable indicator of future performance. The information provided in the document is current as the time of publication.