What is Financial Abuse?
Financial abuse is used by abusers to maintain power over their victims by concealing information to bank accounts and credit cards, limiting or denying the victim access to the family finances, controlling the victim’s access to money by doling out money for specific purchases such as groceries, or gasoline only, allegedly providing her with what she “needs”. By maintaining control over the family finances, the victim’s escape route out of the relationship is closed off, trapping the victim in the relationship with no way out.
Financial abuse can take the form of forbidding the victim to work. Other forms of financial abuse include stalking or sabotaging the victim at work causing the victim to lose their job. In one case, the victim worked for a plastic surgeon and her physical appearance was important. Physical abuse prior to an important business meeting or client meeting causing the victim to stay home and miss important meetings can cause loss of a job. Oftentimes, the victims must turn over her paycheck to her abuser. Giving the victim an allowance is a form of financial abuse with no access to bank accounts or credit cards. In the divorce process, an abuser can drag it out by hiding or failing to disclose assets.
Stealing the victim’s identity, forcing her to work in a family business without pay, refusing to pay bills and ruining the victim’s credit score, forcing her to turn over public benefits and then threatening to turn her in for “cheating or misuse of public benefits” are all forms of financial abuse.
How Can You Secure Your Financial Future?
Contact your local domestic violence hotline or program
Obtain a copy of your credit report and take steps to improve it
Open a private PO box
Find Employment and consider training you may need to become employed
Utilize Financial Counseling Services-look for nonprofit organizations
Manage Debt
Build a Support Network
These are but a few suggestions. Most important is to look for nonprofit organizations that offer free or low-cost financial counseling to survivors of domestic violence.
Financial Abuse is the Main Barrier to Getting Out of an Abusive Relationship
A study by the Centers for Financial Security found that financial abuse occurs in 99% of domestic violence cases. It is less commonly understood than other forms of abuse and yet it is one of the most powerful methods of keeping a victim trapped in an abusive relationship and one of the top reasons a victim returns to the abuser. For her, it comes down to the choice between poverty and homelessness or abuse.
Digital Financial Abuse
Digital financial abuse can be perpetrated by misusing online banking, finance apps to maintain power over a victim. Abusers use “fintech” as a tactic of abuse by sending excessive unprompted requests for funds, monitoring spending through a shared account, changing passwords to deny access or benefits, using online lenders to apply for credit in the victims name.
Actual cases
In one case, K.E. had no access to credit cards or a bank account. She had two children, one of whom had special needs. She was not allowed to work. Her husband left cash on the counter for her for daily living expenses. If she had been “good” to him “sexually”, the cash amount left was increased. If she needed to buy a dress, she had to go to the store, try on the dress, send him a picture of the dress on her and if he liked it, he paid for it by credit card.
In another case, O.N., receives a cash allowance each month. Her husband has accounts and a business and property valued at somewhere over $25,000,000. She has no access to any of the money. She has no knowledge as to where or what the money is. She only has her allowance. She is unable to plan her future or to even consider being financially independent because she has never had other than an allowance in twenty years of marriage. Repeatedly her husband tries to convince her to stay married to him.
H. J., and her husband deposited their pay into the same joint bank account. The husband took the money and used it to invest in specious crypto currencies to which she had no access. When the divorce action commenced, the husband claimed to have little to no crypto investments.
In W.R., the husband controlled all of the finances. The Wife only had access to a credit card in the husband’s control. Once the husband was served with the divorce papers, he cut off the wife, in violation of New York’s Automatic Orders, requiring legal intervention for the wife to gain access to same.
In H.E., after the parties’ wedding the husband had the wife sign the backs of all of the checks and instead of depositing them into a joint account, deposited the checks into an account in his name alone. The wife had no access to the money, only to what the husband would give her. She was limited by the husband as to what groceries she was allowed to buy. In order to go grocery shopping, the wife would receive a credit card that day from the husband. If the wife charged anything on the credit card the husband received an alert on his phone and would call the wife for a detailed account of exactly what she bought. If she bought herself an extra snack from the supermarket, or any other small item he did not approve of, he would get upset with her and yell at her to stop wasting “his money.”
P.J.’s husband destroyed her credit during the marriage, taking out debt in her name. The presumption was that this was marital debt, though she had no knowledge of the charges. She had to engage in costly financial discovery to rebut the presumption and show marital waste.
Educate Yourself Financially
Without financial independence, there is no independence. Look for financial education services online or in your community. They do exist.