New UK law aims to end financial abuse in relationships. Can it work?

by Emma Batha | @emmabatha | Thomson Reuters Foundation
Thursday, 29 April 2021 15:15 GMT

ARCHIVE PHOTO: A man holds money behind his back. Photo taken 2016. REUTERS/Jon Nazca

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One in five British women experience economic abuse, a long-hidden form of domestic abuse recognised for the first time in new legislation

LONDON, April 29 (Thomson Reuters Foundation) - Does your partner take your pay, pinch the kids' pocket money or rack up debts in your name? People usually think of domestic abuse as physical violence, but sweeping new legislation in Britain makes clear it also includes economic abuse.

The Domestic Abuse Bill 2020, which entered into law on Thursday, aims to expand protections for victims and clamp down on abusers.

About 2.4 million people, mostly women, experience domestic abuse every year, according to the UK government.

Many are victims of economic abuse, which often happens in conjunction with physical, sexual or emotional abuse.

Economic abuse can stop someone leaving a dangerous relationship or prevent them rebuilding their lives post-separation.

Some victims are left with debts of tens of thousands of pounds.

Economic abuse has become more prevalent during the COVID-19 pandemic, according to domestic abuse charity Refuge.

What is economic abuse?

Economic abuse is a form of controlling behaviour with often devastating consequences.

It not only includes limiting someone's access to money, but also things like food, clothing, a mobile phone, transport and housing.

Economic abuse is often insidious, gradually increasing over time, and can continue or escalate after separation.

"It's a form of abuse that can continue for decades after a survivor leaves - it's a last invisible chain to an abuser," said Nicola Sharp-Jeffs, CEO of the charity Surviving Economic Abuse (SEA).

Victims may be left unable to buy food for their children, struggling with debt, saddled with poor credit ratings, and in some cases homeless.

How prevalent is economic abuse?

One in five women and one in seven men have experienced economic abuse from a current or former partner, according to a 2015 report by the Co-op Bank and Refuge.

More than 80% of victims reported having suffered other forms of abuse.

About a third said they had not told anyone about the economic abuse. Only 15% had told their bank.

Some women were fearful they would not be believed if they reported it or felt embarrassed and humiliated, while others were scared of their partner's response.

The study also suggested economic abuse was more prevalent among men in same-sex relationships than lesbians.

What difference will the new law make?

Campaigners say the law's recognition of financial abuse as a form of domestic abuse is very important for tackling the long-hidden issue, and greater awareness could even help save lives.

For example, if a victim of violence does not have access to cash they may not be able to escape their abuser, putting them at further risk of harm, or even being killed.

Even if they do manage to leave, lack of money could force them to return to a dangerous relationship.

Campaigners say economic abuse can be an early warning sign, often occurring at the start of a relationship that may become progressively more controlling and violent.

The law does not stipulate specific penalties for economic abuse, but the maximum penalty for controlling or coercive behaviour, which includes economic abuse, is five years in prison.

What are banks and financial institutions doing about it?

Leading British banks and building societies have signed up to a code of practice launched in 2018 requiring them to train staff how to spot financial abuse and encourage victims to seek help.

Many banks now have information and advice about financial abuse on their websites.

Some have been working with domestic abuse charities, including SEA, Safe Lives and Refuge, to improve support for victims, for example by helping them open new accounts that cannot be found by their abuser.

Lloyds Bank established a specialist domestic and financial abuse team last year.

NatWest has appointed a financial abuse specialist and set up a secure online form for reporting financial abuse.

The Co-Op is calling for the creation of a "credit rating repair" system to help survivors get their lives back on track.

Charities have also trained police forces on economic abuse, and set up a financial helpline to empower survivors to regain control of their finances.

But they said the pandemic had made it harder for victims who needed to talk face-to-face with their bank due to restricted services during lockdowns.

What about other countries?

Most states in Australia and some in the United States recognise economic abuse as a form of domestic abuse in law.

Tasmania has criminalised economic abuse as a stand alone offence.

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(Reporting by Emma Batha @emmabatha; Editing by Tom Finn. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, which covers the lives of people around the world who struggle to live freely or fairly. Visit http://news.trust.org)