Though awareness is growing, financial abuse is often one of the most overlooked forms of abuse due to its difficulty to spot.
According to the Australian Bureau of Statistics, 16 per cent of women and 7.8 per cent of men will experience financial abuse in their lifetimes, with increased awareness around the issue identifying it as an often unseen and overlooked form of domestic abuse.
Dealing primarily in the financial realm, advisers are better equipped than most professionals to help identify this form of abuse, according to Amanda Casser, CEO and director of Wealth Planning Partners.
“Financial advisers have deep and trusted relationships with clients that go far beyond the numbers,” Cassar told ifa.
“We’re privy to family dynamics, behaviour, and changes in circumstances that others might never see. This gives us a unique opportunity, and possibly a responsibility to recognise when something isn’t quite right.”
While the debate as to where advisers’ responsibilities extend, knowing how to identify the signs of financial abuse is something professionals should keep in mind as part of their ethical and professional obligation to act in their client’s best interest.
“It’s a hidden problem and is happening whether or not clients tell you. Very few will ever disclose it outright, but advisers may see red flags,” Catherine Fitzpatrick, founder and director at Flequity Ventures, told ifa.
“You can observe who answers the questions, who hesitates, who dominates and who defers. You might notice unexplained changes in account access or authorisations.”
She added: “You may witness power dynamics around money. You may also be asked to make plans that inadvertently contribute to control and coercion.”
Cassar also highlighted some behaviours advisers should keep an eye on.
“Other warning signs include clients who seem unusually anxious or confused about their finances, defer decisions to someone else without clear reason, or make sudden, unexplained changes to financial arrangements, such as altered beneficiaries, new joint accounts, or asset transfers,” she said.
“Isolation from family or advisers, restricted access to funds, or a sudden shortage of money despite adequate income can also raise concern.”
She also highlighted that in elderly clients, a common target for financial abuse, signs include frequent changes to powers of attorney and the sudden appearance of a “new friend” with financial influence are telltale red flags.
Fitzpatrick concluded: “You already manage risks to clients’ wealth and wellbeing. Financial abuse is another risk that can destroy both.
“Acting in your client’s best interests includes recognising when someone’s interests are being overridden by another person’s control.”
If you or someone you know is experiencing domestic or family violence, help is available.
Call 1800RESPECT (1800 737 732) — the National Sexual Assault, Domestic and Family Violence Counselling Service — for confidential support, 24 hours a day.
For financial abuse and money-related support, contact Centrelink’s Social Work Services on 132 850, or visit Good Shepherd’s Financial Independence Hub (1800 946 373) for free, specialised assistance.
