Sexually transmitted debt: How financial services are fighting financial abuse

There’s been a change in the types of matters coming through the doors of Redfern Legal Centre’s financial abuse service.

Perpetrators can also take control of a company themselves, selling off parts of a business or restricting victims’ ability to earn income.One out of every six women“Because so much of managing our finances are online, financial abuse can happen without physical abuse, and continue after separation.”Often lacking access to or control of their finances, victims are left to choose between violence and poverty.

Financial Rights Legal Centre senior solicitor Erin Mulally says people can be pressured into providing assets as security for a loan. “A person who doesn’t have the means to get a loan might ask their partner to put up their car for example” she says. “Then, when the relationship ends, the victim is the one being chased for the debt.”Glenn says issues are most common with joint products, with perpetrators able to clear out joint bank accounts without consent.

Mulally says utilities companies and telecommunications firms can also be roped in. “Electricity or phone bills can be put in a victim’s name, even though the service is being used by someone else,” she says. Australian Banking Association chief executive Anna Bligh says banking staff can often see financial abuse playing out.Wall from CBA says the bank has about 20,000 interactions a year with victims. One of the most common types of abuse is customers sending threatening and harassing messages through the description field of one or two cent transactions.

Westpac’s head of customer excellence Tiffiny Lewin also says it is a problem she encounters. The bank will usually send a warning to the perpetrator or a letter telling them they were not using the service in line with its terms and conditions. While some companies, including Westpac, have started training design staff to think about how to introduce friction, or empower customers to prevent harm, Glenn says she wants financial safety to be considered when designing all products.

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