10 red flags that someone you know may be suffering financial abuse

A report released at the start of 2023 by Aviva makes for worrying reading, as it reveals that two in five Britons claim to have suffered economic or financial abuse. Furthermore, 39% of victims suffered abuse at the hands of a spouse or partner, making this type of financial abuse the highest proportion of all.

In 21% of cases the perpetrator was a friend, and in 14% of cases the culprit was an employer. While these findings are disturbing enough, 61% of victims also said their plight had been made worse due to the cost-of-living crisis.

Aviva also found that while men were more likely to report financial abuse, women were more likely to suffer it, suggesting that 47% of women could have suffered financial abuse. While the number of victims may be high, the amount of people who sought help is sadly much lower.

Just 23% of victims sought support from their bank, and only 13% spoke to the police about their situation. This is understandable when you consider that the victim might be frightened of the perpetrator, or wrongly believe they wouldn’t be able to cope if they had to look after their own finances.

Against this backdrop, you may be wondering how to spot when someone you know is suffering abuse. Learn 10 signs that might indicate that a friend, work colleague or family member is a victim. Before you do though, let’s consider what financial abuse is.

Financial abuse typically involves “coercive control” of your wealth

Financial abuse is the mistreatment of someone via their wealth, and typically involves coercive control. This could include controlling their cash, investments or property, and may take the form of theft, fraud or pressure to make certain decisions.

It is legally recognised as a form of domestic abuse that can involve a spouse, partner or even an ex-partner’s money or finances.

This could include:

• Using the victim’s credit cards without permission
• Making contractual obligations using the victim’s name
• Gambling with the victim’s money.

As a result, the victim’s freedom of choice could be significantly reduced as their money effectively stops being their own. This means that they’re less likely to enjoy it and spend it as they would want on items such as clothing, food or socialising with friends.

10 signs that someone you know or love is being financially abused

While financial abuse is extremely upsetting and stressful for victims, it might be more difficult for others around them to spot. With this in mind, let’s now look at 10 signs that someone you know might be suffering economic abuse.

• Someone becomes intentionally vague or evasive over their finances and refuses to answer questions or concerns that you raise.
• A lack of understanding about elements of their wealth that you believe to be out of character.
• If someone you know uncharacteristically starts to express concern about their money, investments or other assets.
• As financial abuse may be systematic of wider abuse, look out for any physical signs of harm. This may also include someone you know becoming isolated from their family or friends.
• Another tell-tale sign could be a large number of unpaid bills when someone else is meant to be handling payments on their behalf.
• When signatures on documents no longer resemble previous signatures.
• As abusers want to control the victim’s wealth, their name may be added to financial accounts. If a name appears on financial accounts or documents when you feel they shouldn’t, this may be a red flag.
• Changes in spending behaviour, which may include suddenly spending large amounts, or stopping spending all together.
• Any unexplained transfer of assets to another person, even if this is a spouse or partner.
• An unexpected change to a will, or the creation of a Power of Attorney (POA) may also be a sign of abuse. Care should be taken here as creating a POA can also be the sign of good financial planning.

Also, be aware that when someone experiences a big life change, including bereavement, job loss, sudden relocation, serious illness, injury or another significant life change. This could make them more vulnerable.

Help is at hand if your suspicions are correct

One particularly alarming finding by Aviva was how widespread economic abuse is in the UK and how, particularly for women, abuse by so called “loved ones” can last several years. While changes in someone’s behaviour, spending habits or wishes does not automatically mean that they’re suffering financial abuse, it may be sensible to speak to them about your concerns.

If it transpires that your suspicions are correct, there is help available to them. If it’s an emergency, you could call the police on 999, or if it’s not an emergency, you can call 101 to report the abuse.

Alternatively, they could also contact Action Fraud by visiting their website or calling 0300 123 2040, or speak to Money Advice Plus or Surviving Economic Abuse, both of which provide support for those effected by financial abuse.

Get in touch

A financial planner can also help prevent financial abuse as they can highlight or question irregular decisions that might reveal it. If you know someone you feel would benefit from a conversation with us here at HarperLees Financial Planning, we would be happy to help.

Please email info@harperlees.co.uk or call 01277 350560.

Please note

This blog is for general information only and does not constitute advice. It should not be seen as a substitute for financial advice as everyone’s situation will be different.

Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change. The information is aimed at retail clients only.