Domestic and family violence increases in times of disaster, and services are already reporting an increase in calls for help as a result of COVID-19. Contributing risks include isolation with a violent partner and being cut-off from community supports.
Other factors specifically increase the risks of financial abuse. Financial abuse (also referred to as economic abuse) is a form of family violence which commonly accompanies physical and emotional abuse.
The ability to access superannuation opens up an avenue for an abusive person to coerce, or force, their partner to access their funds when this is not in the person’s best interests. New rules allow people to draw down up to $20,000 of their superannuation over two years. This could cost $50,000 in retirement income, or about a year’s worth, according to Super Consumers Australia, who suggest this should only be done as a last resort.
According to community services which are members of the Economic Abuse Reference Group, the social security system also presents risks, particularly for women. The woman is generally liable for debts incurred for certain payments if their partner doesn’t provide accurate income information, and women are too often coerced into making false claims where the funds are used for another person’s benefit. It is likely that the increase in the numbers of eligible claimants, and the new range of benefits available, will lead to an increase in this form of abuse.
Risks related to family businesses are likely to increase as businesses are under greater stress. One partner may be coerced into signing documents even though they have little involvement or understanding of the business finances. After a relationship breaks down, it’s not uncommon for one partner to have responsibilities as a director, or to have large debts, which they have been unaware of.
Financial stress may also see an increase in other forms of financial abuse that we see in our work, for example drawing down on mortgages without the other partner’s knowledge, withholding money for necessary living expenses and coercing the partner to sign loans.
The increase in online (rather than in-person) shopping, and move away from stores accepting cash, may also allow a perpetrator to have tighter control over the other person’s finances.
We have made significant progress in Australia over the last two or three years to improve government and business awareness of economic abuse, and responses to helping those who are experiencing it.
With the focus on responding to the pandemic, it’s important that community, industry and government continue to be alert to the risks of domestic and family violence, including economic abuse.
Banks, energy, water and telecommunications companies have processes to respond to financial hardship, and also now have processes to help customers who are experiencing financial abuse. People should check their provider’s website, call them and tell them they are experiencing abuse or get help from a free financial counsellor. There are specialist family violence financial counsellors in Victoria and some other states.
If you, or someone you know, is experiencing financial abuse, call 1800 RESPECT or they can contact free financial counselling by calling 1800 007 007.