This article was contributed by George Grumbar, Head of Customer Affairs, Revolut
When friends and loved ones make bewildering financial decisions, we frequently assume it’s because they have been “blinded by love”. Financial abuse is rarely discussed and the Netflix true-crime documentary Bad Vegan shows how victims of such abuse are often misunderstood.
Financial abuse can and does occur without physical violence. Those trapped in a financially abusive relationship may not show bruises on their arms or faces. They may not even be miserable or unhappy. But their decisions defy common sense and it can be frustrating as a friend to witness this. If you’ve not seen Bad Vegan, be warned that there are some spoilers in the next paragraph.
Financial Abuse In Bad Vegan
Bad Vegan details the fall from grace of restaurateur Sarma Melngailis, once hailed as the “princess of raw veganism”. In an attempt to recover from a breakup, Melngailis adopted a dog and from there, was introduced to Shane Fox who claimed he could turn her and her beloved pup immortal. Shane Fox, whose real name is Anthony Strangis, subjected Melngailis to much mental and emotional abuse. At one point in their relationship, Melngailis shared how she felt she had “no choice” but to go along with a series of “cosmic endurance tests” which involved her transferring hundreds of thousands of dollars to Strangis so she could “prove that she was worthy of staying by his side for eternity.”
As I followed the series, I found myself picking up my jaw from the floor several times. It got me thinking how it’s much easier to write people off for being “crazy”, “silly”, or “naive” when they fail to get their financial affairs in order. We all have to do a better job at spotting if a loved one is in a financially abusive relationship.
Financial Abuse Is Unfortunately More Common Than We Think
The thing is, financial abuse is more prevalent than we think. In a 2017 study, almost 70% of millennial women said they’ve suffered financial abuse by a romantic partner. The same study shows that almost 50% of men said they’ve experienced financial abuse
So, how can we tell if a friend or a family member could be trapped in a financially abusive relationship?
#1 Their Spending Behaviour Changes Inexplicably
If your usually-prudent friend starts taking out loans or instalment plans for expensive items but you don’t actually see them using the stuff, it could be a sign they are being bullied or guilt-tripped into buying these items for someone else.
“How on earth did his friend manage to empty his bank accounts?”
#2 They Borrow Money Constantly, Usually Because They Want To Help Their Partners
They make excuses like, “He just needs a little help to tide him over” or “She’s really not expecting me to help but I want to”. Your friend feels obliged to go out on a limb for their partner, often putting their credibility at risk.
“Her boyfriend makes her borrow money from her colleagues. Unbelievable!”
#3 They Don’t Have Access To Their Own Finances And Have No Idea What Happens To Their Money
They hand their salaries over to their partner or allow their spouse or children to control their bank accounts. They can’t pay for basic essentials but are faced with an ever-growing number of loans and credit card bills.
“How could she just hand over her entire salary to her husband?”
What Should You Do If You Suspect That Your Friend Is Being Financially Abused?
Be acutely aware that they may not even think they are in a financially abusive relationship. Set up a time to talk and share your concerns. It is difficult for someone to talk about abuse and so remember to be patient and empathetic. If your friend gets defensive or does not agree with you, let them know you’ll be there if they ever need help.
Help your friend regain as much control of their finances as possible. Whether it’s visiting a bank to close their existing accounts, cancelling supplementary cards, or seeking help with a divorce lawyer, the key is to act swiftly. If the bulk of their money is stuck in a joint account, it is best to find out if the bank has a policy of allowing either account holder to freeze or place a hold on the account until further notice.
Take Control Of Your Own Finances
Having the confidence and the knowledge to manage your own money is most certainly the first step in making sure you never compromise yourself financially. Always have visibility of your accounts, portfolios, credit lines, and avoid setting up joint accounts or giving a partner a supplementary card too early in the relationship. If you must have someone complete an online purchase on your behalf, consider using a one-time use debit card, like Revolut’s Virtual Disposable card, so they will not be able to perform other transactions without your knowledge.
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