Identifying and Responding to Financial Abuse in Relationships

What happens when every pound you spend is scrutinised? When you’re denied access to your own bank accounts? When working isn’t an option because your partner won’t allow it? These scenarios can be indicative of financial abuse, a deeply damaging and often invisible form of domestic abuse.

While physical and emotional abuse are more readily recognised, financial abuse operates as a powerful tool of control which can diminish a victim’s autonomy and trap them in harmful relationships.

Understanding Financial Abuses

Financial abuse, also referred to as economic abuse, goes beyond mere disagreements about spending. It involves a pattern of behaviour where one partner seeks to control the other’s access to and use of financial resources, ultimately striving to make them financially dependent. This control can manifest in numerous ways.

• An abuser might meticulously monitor their partner’s spending, demanding receipts for every purchase, no matter how small.
• They may control all the money in joint or even individual bank accounts, doling out meagre allowances that barely cover essential expenses.
• Access to credit cards might be denied, or the victim might be prevented from opening their own bank account, further limiting their financial independence.
• In some cases, the abuser might forbid their partner from seeking employment or, if they do work, demand that all earnings be handed over to them. This can extend to coercing a partner into taking out loans or opening accounts against their will, or refusing to contribute to shared household or parenting expenses.

Prevalence in the UK

The prevalence of financial abuse in the UK is alarmingly high, often occurring in the vast majority of domestic abuse cases. Studies indicate that financial abuse is present in as many as 95% to 99% of abusive relationships.

Recent research highlights that one in five women in the UK has experienced economic abuse in the past year, equating to approximately 5.5 million women. Another report suggests that nearly a quarter of women who have endured economic abuse stated that the abuse itself prevented them from leaving the relationship.

Certain demographics are disproportionately affected, with younger women aged 18-24 and women from Black, Asian, and ethnic minority backgrounds being more likely to experience economic abuse.

The Psychological Impact

The impact of financial abuse extends far beyond mere monetary loss. It inflicts deep psychological and emotional scars on its victims. The constant control and deprivation can lead to severe stress, anxiety, and depression. Victims often experience a profound loss of trust, not only in their abuser but also in their own judgment and ability to manage their lives.

Their sense of independence is eroded as they become increasingly reliant on their abuser for even basic necessities. Feelings of shame, embarrassment, and lowered self-esteem are common, even though the abuse is never the victim’s fault.

This can be compounded by the abuser’s manipulative behaviour, which may involve gaslighting, making the victim doubt their own sanity and perceptions. The isolation that often accompanies financial abuse further exacerbates these emotional wounds, as abusers frequently cut off their partners from friends and family who might offer support.

Recognising the Warning Signs

Recognising the early signs of financial abuse is crucial for intervention and seeking help.

Several red flags can indicate that someone is experiencing this form of control:

• A partner who consistently monitors spending, demands detailed accounts of every purchase, or withholds access to bank accounts
• Providing a strict and inadequate “allowance”
• Preventing the other from working or pursuing education, or sabotaging their work opportunities
• Forcing or coercing into taking out loans or credit cards against one’s will
• Accumulating debt in one’s name without consent
• Making significant financial decisions without consultation
• Concealing financial information or refusing to contribute to household expenses
• Stealing money or forging signatures on financial documents
• Pressuring their partner to change their will
• Interfering with work through constant calls or unannounced visits
• Preventing access to transportation needed for work

Legal Protections in the UK

In the UK, the legal system is increasingly recognising and addressing financial abuse. The Domestic Abuse Act 2021 marks a significant step forward by including “economic abuse” in the legal definition of domestic abuse.

This Act defines economic abuse as any behaviour that has a substantial adverse effect on an individual’s ability to acquire, use, or maintain money or other property, or to obtain goods or services.

Additionally, the Financial Abuse Code, developed by UK Finance, provides guidance to financial institutions on how to identify and support victims of financial abuse. The Care Act 2014 also includes financial abuse in its definition of abuse, and the Mental Capacity Act 2005 offers protection for individuals lacking the capacity to make financial decisions.

How Maguire Family Law Can Help

For individuals going through divorce or separation, where financial abuse often comes to light, seeking legal support is paramount. Maguire Family Law’s expertise encompasses a deep understanding of these financial complexities. We can assist clients in defining financial issues and understanding their rights.

During divorce proceedings, our team provides guidance on navigating financial aspects, including complex situations in high-net-worth divorces. We can also help formalise financial agreements, make financial claims, and secure consent orders.

Understanding financial procedures and, in urgent cases, obtaining freezing injunctions are further ways Maguire Family Law can support those affected by financial abuse.

Support Resources Available

Numerous organisations in the UK offer support and resources for individuals experiencing financial abuse:

• Surviving Economic Abuse (SEA) offers a Financial Support Line at 0808 196 8845 for specialist advice.
• The National Domestic Abuse Helpline, run by Refuge and Women’s Aid, can be reached 24/7 at 0808 2000 247.
• For financial guidance, Money Advice Plus, Money Helper, Citizens Advice, and Turn2Us offer valuable services.
• Debt management support is available from National Debtline and StepChange.
• Other helpful organisations include The Money Charity, UK Finance, Hourglass (for elder abuse), Men’s Advice Line, National LGBT+ Domestic Abuse Helpline, and Rights of Women (for legal advice).
• In emergencies, dial 999, and if you cannot speak, dial 999 then 55 for the silent solution.

Taking the First Step

Maguire Family Law stands firmly by the side of individuals affected by all forms of domestic abuse, including the often-overlooked issue of financial abuse. Our team of experienced family law professionals understands the financial complexities that can arise during divorce and separation, particularly when abuse is a factor.

If you are experiencing financial abuse or have concerns about your financial safety within a relationship, we encourage you to reach out to Maguire Family Law for a confidential discussion and to explore your options. Call our team on 01625544650, or fill in our contact form.

References

Experian. (2024, March). 1 in 5 women in the UK have experienced economic abuse – Learn how to spot the signs. https://www.experianplc.com/newsroom/press-releases/2024/1-in-5-women-in-the-uk-have-experienced-economic-abuse–learn-ho 

Women’s Aid. (2019). The economics of abuse: How the national domestic abuse helpline responds to economic abuse. https://www.womensaid.org.uk/wp-content/uploads/2019/12/Economics-of-Abuse-Report-2019.pdf

Ipsos UK. (2024). Uncovering the reality of economic abuse among women in the UK. https://www.ipsos.com/en-uk/uncovering-reality-economic-abuse-among-women-uk

Coughlan, S. (2024, January 30). Women being trapped in relationships due to economic abuse, charity finds. The Independent.
https://www.independent.co.uk/money/women-being-trapped-in-relationships-due-to-economic-abuse-charity-finds-b2653595.html

Surviving Economic Abuse. (2024, January 30). One million women trapped. https://survivingeconomicabuse.org/news/one-million-women-trapped/ 

Domestic Abuse Act 2021, c. 17. https://www.legislation.gov.uk/ukpga/2021/17/contents