‘Devastating’: Could you spot these symptoms of financial abuse?

Financial coercive control is an incredibly manipulative form of abuse that strips people of their financial independence, dignity and security. As a financial adviser, I see the impacts firsthand, especially – but not exclusively – among women and the elderly.

Financial abuse involves controlling a person’s access to or use of money to make them dependent, powerless or fearful. Sometimes it starts subtly, with one partner handling all household finances, or an adult child helping an elderly parent with online banking.

Women and the elderly are common targets of financial abuse.Credit: Getty.

Many people will recognise themselves in the above scenarios – but sometimes this evolves into complete financial reliance and domination.

In some cases, it is about not being provided with enough money to purchase food and essentials, in others it might be having income payments paid into a partner’s bank account.

The alarm bells ring for financial advisers if a client seems unaware of how their money is spent, is unable to explain large withdrawals or debt accumulation or is unable to access their own bank accounts.

The Commonwealth Bank of Australia estimates that financial abuse costs victims $5.7 billion annually. Yet too often the abuse remains hidden – and victims may not even realise they are being abused, especially if it is by a close family member.

Rebuilding after abuse is often an uphill battle. Victims may face a loss of confidence, legal hurdles and in the worst-case scenario, financial ruin.

ASIC and the Financial Advice Association of Australia provide guidance for financial advisers, but the real power lies with the long-standing relationships we build with clients – we are uniquely placed to identify red flags and help clients reclaim their financial independence.

One case I encountered involved a woman whose husband had always managed the family’s finances. After their separation, she was stunned to learn she had no assets in her name and mounting debts she’d never seen.

Another involved an elderly mother whose son persuaded her to invest her superannuation into his failing business. With no funds left and having “gifted” the money, she became ineligible for Centrelink support.

These examples highlight the devastating ripple effects of financial control – loss of savings, loss of support and loss of trust.

Eleanor Lau, family & relationship law specialist at Lander & Rogers Lawyers, says amendments to Australia’s Family Law Act which come into effect on June 10, 2025 could be a critical turning point.

For the first time, the law will explicitly recognise financial abuse as a form of family violence. This includes actions such as denying financial autonomy, sabotaging employment, forcing someone to take on debt, or withholding money needed for basic living expenses.

These changes will shape court decisions in custody disputes and property settlements, making financial abuse a mandatory consideration. Legislation is just one piece of the puzzle. Lau says legal professionals must be able to screen for financial coercion during family law proceedings.

Asking clients simple yet revealing questions — such as whether they had access to their own income, were prevented from working, or had debts incurred in their name — can uncover hidden abuse.

Reviewing bank statements and credit reports and using subpoenas where necessary can help build a case when victims themselves can’t provide evidence.

How to protect yourself

For those seeking protection from financial coercive control, there are a few essential first steps: have a separate bank account, secure your personal identification documents so no one else has access to them, and make sure you have an understanding of your household finances.

If you are still in a relationship with the abuser, be cautious about how you try to document financial abuse and obtain copies of financial records without escalating your risk - your physical safety is always priority, ahead of seeking evidence of financial abuse.

Rebuilding after abuse is often an uphill battle. Victims may face a loss of confidence, legal hurdles and in the worst-case scenario, financial ruin. Many struggle to re-enter the workforce or even access government support due to the financial damage caused.

Working with a lawyer who is a family violence specialist and has a strong understanding of financial abuse can be helpful.

When it comes to domestic and family violence it’s important to have an understanding of the different formats abuse can take. Financial coercive control is a devastating form of manipulation that can leave victims trapped and invisible.

If you or someone you know is experiencing financial abuse, support is available. Contact 1800RESPECT (1800 737 732) for 24/7 confidential advice.

Grace Bacon is the Director of RSM Financial Services Australia (AFSL 238 282), advising clients on wealth management, retirement planning and succession planning.

• Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making financial decisions.

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