Financial abuse is a form of domestic abuse that perhaps doesn’t receive as much attention as it should. This is unfortunate considering it’s much more prevalent than you might initially realise.
According to research from Experian, 1 in 5 women in the UK have experienced some form of financial abuse at some point in their lives.
This demonstrates that there’s a need for greater awareness of the signs of financial abuse, especially if you’re working in professional services. In fact, you might be in a unique position to identify the signs of financial abuse and provide practical support to vulnerable clients – continue reading to find out how.
Financial abuse occurs when an abuser takes control of a victim’s finances
Legally recognised under the Domestic Abuse Act and classified by the police as a form of coercive and controlling behaviour, financial abuse occurs when one person takes control of another’s finances.
This often leaves the victim without access to their money or control over their financial decisions.
It might manifest as a partner preventing the other from working, withholding their funds, or dictating how they spend their money. It could involve a perpetrator:
- Stopping the victim from going to work, college, or university
- Causing another to lose out on benefits
- Taking control of bank accounts
- Giving a partner an “allowance” to spend
- Prohibiting them from going to work
- Taking out loans or credit in another person’s name
- Controlling their access to vital things such as food, clothing, and transport.
In more severe cases, victims might be left isolated, lacking confidence, and feeling trapped in an abusive relationship due to their dependence on the abuser for financial support.
Worryingly, financial abuse doesn’t always occur between cohabiting partners. It can continue long after separation, or even begin long after a relationship has ended.
Signs that could indicate financial abuse is occurring
As a professional, you might be one of the few people in a position to recognise the early signs of financial abuse. While the red flags aren’t always obvious, some might indicate a deeper issue.
Moreover, the charity Surviving Economic Abuse reports that it can occur alongside other forms of domestic abuse, including physical or psychological control, making it especially dangerous.
Some of the warning signs to look out for include:
- An individual remaining silent during meetings while their partner speaks for them
- Significant debts in a client’s name that they don’t fully understand
- A person appearing fearful, withdrawn, or uncomfortable discussing their finances
- Signs of success or financial independence seem to irritate their partner
- Requesting changes to a will or financial plan under pressure
- Seeming unfamiliar with transactions or financial decisions carried out in their name.
It’s vital to note that some of these signs might simply indicate a lack of confidence, so it’s worth avoiding rushing to any conclusions.
Despite this, it’s still wise to remain vigilant to any patterns of negative behaviour and potential vulnerabilities in your clients.
5 practical ways you can help clients who might be experiencing financial abuse
If you’re concerned about a client’s wellbeing and suspect they’re a victim of financial abuse, it’s essential to approach the situation with care.
That said, the steps you take could significantly help them regain control over their wealth and secure their financial independence.
1. Express your concern privately
If you have concerns, you might want to try speaking to your client privately. It’s crucial not to ask too many deep questions at first, as this could make them uncomfortable or put them on the defensive.
Instead, you might want to express that you’re available to help them and that they don’t have to face any issues alone.
2. Encourage them to seek external support
There are several helplines and support services available that could give your client the assistance they need to escape financial abuse. Some helpful resources include:
- The National Domestic Abuse Helpline (England) – This is a 24-hour confidential service run by Refuge that your clients can contact on 0808 2000 247, or online.
- Women’s Aid online – Clients can also speak directly with a support worker from Women’s Aid between 10 am and 6 pm, seven days a week.
- Local services – Many regions will have local and dedicated domestic abuse services. You could encourage them to search through this directory, which allows clients to search for services by location.
These resources could help your clients take the first steps towards their financial independence.
3. Explore online resources
You may also want to direct your vulnerable clients to online platforms – such as Surviving Economic Abuse – which are incredibly helpful.
They offer extensive information and resources for victims of financial abuse while providing a directory of support services across the UK.
4. Consider contacting the police
If you strongly suspect criminal activity, such as theft, fraud, or coercion, it might be appropriate to involve the police.
Just make sure you handle this with caution, especially if your client hasn’t yet disclosed the full extent of their situation, as you may only make things worse.
5. Continue offering long-term support
No matter what happens, continuing to assist your client over the long term can be an incredible source of relief for them.
For instance, you could offer to answer questions without delay or oversee their financial affairs.
This could give them peace of mind that their financial future is being looked after by a professional who understands their needs.
Get in touch
If you have vulnerable clients who would benefit from assistance, we can give you the assistance needed to support them.
Please email us at mail@delaunaywealth.com or call 0345 505 3500 to find out more.
Please note
This article is for general information only and does not constitute advice. The information is aimed at retail clients only.
The Financial Conduct Authority does not regulate estate planning, cashflow planning, tax planning, trusts, Lasting Powers of Attorney, or will writing.
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