Financial Abuse

by | Oct 8, 2019 | Newsletters

October is National Domestic Violence Awareness Month.  Financial Abuse occurs in 99% of all domestic violence cases* and is a form of abuse that can sometimes be difficult to diagnose.  When people think of domestic abuse, they typically think of physical abuse where you can see the physical signs that something is happening.  However, other forms of abuse, such as financial and emotional abuse, are not as obvious.  Financial abuse is the silent form of domestic violence and is one of the most powerful forms of abuse and most difficult to escape.  Seven out of eight victims of financial abuse go back to the abuser because of this. **  Financial abuse doesn’t just have to be between a couple, it can occur with caretakers and seniors or with legal guardians.  Financial abuse occurs among all different ethnicities, ages, and economic backgrounds.

What is financial abuse? Financial Abuse is the act of blocking or controlling access to financial assets to ensure the victim is dependent on the abuser. The abuser can be a domestic partner, a caretaker, guardian, or present in any situation where one is in control of someone.  The goal of the abuser is for the victim to become completely financially dependent, to where they do not have the means to make it on their own.  In many cases, it comes across as being loving or endearing because that person is saying they will help you and take care of the finances to relieve you of the burden.  This leaves the victim trusting this person and unaware that the abuser is using their power to hide money, spend or gamble it away, or rack up debt in the victim’s name.

There are also forms of financial abuse that are more violent, such as going to the victim’s place of work and causing them to lose their job, forbidding them to work, or forcing them to work long hours or be the breadwinner while the abuser does not contribute financially to the relationship.  Other forms of financial abuse include giving someone an allowance or withholding money, refusing to pay for basic needs for the family, not allowing the victim to see bank accounts, ruining the victim’s credit, or forcing the victim to write bad checks or sign a false tax return.  Financial abuse can often take years to recover from in terms of rebuilding savings and credit.  Some victims may need to file for bankruptcy just to start over.

Financial abuse can have long lasting effects that make it very difficult for a victim to leave an unhealthy situation because, for example, they are not left with enough money to break free and get out on their own.  Coupled with poor credit, this can make it that much harder to start over. Raising awareness and educating people on the signs is important, especially when approximately 78% of Americans do not recognize financial abuse as a form of domestic violence.  There are many services that can help victims**, and the first step is figuring out this is happening.  Sometimes the victim doesn’t realize it’s happening until they try to leave an abusive relationship and find their accounts drained.  Stay involved in your finances, if someone is upset that you are asking questions or want to be involved there may be a larger problem.  Make sure to have all your account user names and passwords and check them regularly.

Hiring a trusted financial professional as a fiduciary also adds checks and balances.  As an advisor, we can see if there is a sudden change in the investment behavior of one of our clients, if they are suddenly writing large checks to a family member regularly, or one of the parties is slowly draining the account over time.  When we call to talk to a client that may be elderly, are they afraid to say something on the phone for fear their caregiver may harm them?  We need to be aware that this is an issue so that we can see the signs and help our client’s before it goes too far.

If you or someone you know are a victim, below are links to some resources that you can contact for help.

*https://centerforfinancialsecurity.files.wordpress.com/2015/04/adams2011.pdf

**https://money.usnews.com/money/blogs/my-money/2011/04/26/how-to-stop-domestic-financial-abuse

https://www.huffpost.com/entry/7-ways-to-help-victims-of-financial-abuse-break-free_b_59e751d3e4b0153c4c3ec41e?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAABmP1dIt6D20gPNXlLml6rDfT5paoV8GJ-WHRJpCzTLHsXnWTU8TQXxwkgEhphFgLNsdCMqGFEfsR5ORgZqaQNXqRMUmgxj0QM0uY65_Uk-3liHgou0zB6P9cD7YzNZXUkIwCwswPSPBMR2k3DzrJAVuYNA-3PpNLZ1vt89nPxJz

https://www.verywellmind.com/financial-abuse-4155224

For help:

www.nnedv.org

https://www.womenslaw.org/about-abuse/forms-abuse/financial-abuse/all?gclid=EAIaIQobChMI_oi1lMG_4wIVhYbACh2P0Q8wEAAYAiAAEgIW0fD_BwE#node-27115

National Domestic Violence Hotline 1-800-799-SAFE

 

Kristin Sweis

Join the Spotlight Asset Group Newsletter

Financial Abuse

by | Oct 8, 2019 | Newsletters

October is National Domestic Violence Awareness Month.  Financial Abuse occurs in 99% of all domestic violence cases* and is a form of abuse that can sometimes be difficult to diagnose.  When people think of domestic abuse, they typically think of physical abuse where you can see the physical signs that something is happening.  However, other forms of abuse, such as financial and emotional abuse, are not as obvious.  Financial abuse is the silent form of domestic violence and is one of the most powerful forms of abuse and most difficult to escape.  Seven out of eight victims of financial abuse go back to the abuser because of this. **  Financial abuse doesn’t just have to be between a couple, it can occur with caretakers and seniors or with legal guardians.  Financial abuse occurs among all different ethnicities, ages, and economic backgrounds.

What is financial abuse? Financial Abuse is the act of blocking or controlling access to financial assets to ensure the victim is dependent on the abuser. The abuser can be a domestic partner, a caretaker, guardian, or present in any situation where one is in control of someone.  The goal of the abuser is for the victim to become completely financially dependent, to where they do not have the means to make it on their own.  In many cases, it comes across as being loving or endearing because that person is saying they will help you and take care of the finances to relieve you of the burden.  This leaves the victim trusting this person and unaware that the abuser is using their power to hide money, spend or gamble it away, or rack up debt in the victim’s name.

There are also forms of financial abuse that are more violent, such as going to the victim’s place of work and causing them to lose their job, forbidding them to work, or forcing them to work long hours or be the breadwinner while the abuser does not contribute financially to the relationship.  Other forms of financial abuse include giving someone an allowance or withholding money, refusing to pay for basic needs for the family, not allowing the victim to see bank accounts, ruining the victim’s credit, or forcing the victim to write bad checks or sign a false tax return.  Financial abuse can often take years to recover from in terms of rebuilding savings and credit.  Some victims may need to file for bankruptcy just to start over.

Financial abuse can have long lasting effects that make it very difficult for a victim to leave an unhealthy situation because, for example, they are not left with enough money to break free and get out on their own.  Coupled with poor credit, this can make it that much harder to start over. Raising awareness and educating people on the signs is important, especially when approximately 78% of Americans do not recognize financial abuse as a form of domestic violence.  There are many services that can help victims**, and the first step is figuring out this is happening.  Sometimes the victim doesn’t realize it’s happening until they try to leave an abusive relationship and find their accounts drained.  Stay involved in your finances, if someone is upset that you are asking questions or want to be involved there may be a larger problem.  Make sure to have all your account user names and passwords and check them regularly.

Hiring a trusted financial professional as a fiduciary also adds checks and balances.  As an advisor, we can see if there is a sudden change in the investment behavior of one of our clients, if they are suddenly writing large checks to a family member regularly, or one of the parties is slowly draining the account over time.  When we call to talk to a client that may be elderly, are they afraid to say something on the phone for fear their caregiver may harm them?  We need to be aware that this is an issue so that we can see the signs and help our client’s before it goes too far.

If you or someone you know are a victim, below are links to some resources that you can contact for help.

*https://centerforfinancialsecurity.files.wordpress.com/2015/04/adams2011.pdf

**https://money.usnews.com/money/blogs/my-money/2011/04/26/how-to-stop-domestic-financial-abuse

https://www.huffpost.com/entry/7-ways-to-help-victims-of-financial-abuse-break-free_b_59e751d3e4b0153c4c3ec41e?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAABmP1dIt6D20gPNXlLml6rDfT5paoV8GJ-WHRJpCzTLHsXnWTU8TQXxwkgEhphFgLNsdCMqGFEfsR5ORgZqaQNXqRMUmgxj0QM0uY65_Uk-3liHgou0zB6P9cD7YzNZXUkIwCwswPSPBMR2k3DzrJAVuYNA-3PpNLZ1vt89nPxJz

https://www.verywellmind.com/financial-abuse-4155224

For help:

www.nnedv.org

https://www.womenslaw.org/about-abuse/forms-abuse/financial-abuse/all?gclid=EAIaIQobChMI_oi1lMG_4wIVhYbACh2P0Q8wEAAYAiAAEgIW0fD_BwE#node-27115

National Domestic Violence Hotline 1-800-799-SAFE