Power and Purse Strings

A lack of economic awareness or control over one’s finances can have long-term impacts. We look at the link between intimate partner violence and money in the third article of our series for Financial Literacy Month.

At the start of her marriage, Margaret Williams (a pseudonym) was perfectly OK letting her husband take the lead and do all the planning around their finances and work lives.

“He told me it was best for the family if I raised the kids and worked part time doing admin tasks for his company,” Williams said. “And so, basically what happened was that I wasn’t gaining any marketable skills. He saw to everything regarding the finances. I didn’t find out till later that all the things he did were advantageous to him.”

By “later” she means when her husband’s physical and mental abuse had pushed her to a breaking point — and she was thinking of leaving the marriage.

“When everything escalated, he threatened to take all his money out of the joint account,” she says. “Since he was the only one officially working, that was all of our money.

“And that’s exactly what happened after I ended the marriage,” Williams adds. “I was left with nothing.”

But emptying the joint account wasn’t the end of the economic abuse. After the divorce, her ex-husband not only refused to pay all the court-ordered child support, he also damaged her credit history and left her with little choice but to rack up debt on a family member’s line of credit.

Coercive control
Unfortunately, such stories are all too common. While people often think of intimate partner violence (IPV) in physical, sexual, and emotional terms, economic abuse also occurs in an estimated 99 per cent of IPV cases.

Economic abuse can make it especially difficult for the person being targeted to leave their situation. It’s also a significant barrier to a survivor’s recovery and positive mental health outcomes.

“If you don’t have the financial resources to obtain mental health services, your recovery is going to take much longer than it otherwise would,” says Dr. Kristina Nikolova, whose research at the University of Windsor focuses on economic abuse. Yet, despite its damaging effects, supporting those who are subjected to it is an often neglected issue in Canada.

“We have good shelters, good food banks, emergency support systems, and crisis lines,” says Meseret Haileyesus, CEO and founder of the Canadian Center for Women’s Empowerment (CCFWE). “But survivors also need a strong economic empowerment program.” To meet this need, the CCFWE offers several resources, including financial literacy workshops and checklists for financial abuse survivors, and also advocates for systemic change — which starts by raising awareness.

“This form of violence has not really been defined properly in Canada,” notes Haileyesus, “When it is, it’s usually divided into three parts, starting with economic control: deliberately restricting access to bank accounts, communication, and transportation but also to work, education, and training.”

The second part is economic exploitation, which may involve physical destruction (e.g., houses, cars) or destroying a partner’s finances by gambling, overspending, or drawing out expensive custody and divorce proceedings. “With economic exploitation, the perpetrator might rack up debt in the name of the victim,” says Nikolova. “Technically, we do have fraud legislation for this, but in an intimate relationship it’s very hard to prove whose debt it actually is.”

The third part is employment sabotage, a deliberate pattern of keeping victims from working by withholding transportation, confining them, or stalking them at work. According to Nikolova, because employers are often unaware of economic abuse, they tend to blame absenteeism or poor performance on the victim, even though it can stem directly from IPV.

Meseret Haileyesus

“In Ontario, workplaces are supposed to have guidance and safety protocols for dealing with domestic violence, but people rarely receive that training,” she says. “As a result, it often isn’t recognized unless somebody shows up screaming and yelling and wielding a weapon. That’s the only form in which the victim might actually get some leeway and not lose her job because of the abuse.”

Other researchers in the field and people with lived experience of economic abuse suggest that employers, in a sense, collude with the abuser, even if unwittingly. Throughout her separation and divorce, Williams says her experience led her to believe that the courts have little understanding of economic abuse, which makes it easy for abusers to exploit the system.

“I always expected that, when things went south, the law and the courts would protect the well-being of children,” she says. “I believed that but had no idea that this is absolutely not the reality whatsoever. I’m really sad to say that this isn’t the society I would hope for my kids to have one day.”

Systemic change
Although Canada’s Divorce Act was revised in 2021 to acknowledge the role financial abuse plays in gender inequity, the overarching system needs an overhaul to make any significant difference. For example, Williams says that family responsibility offices are toothless when it comes to enforcing child-support payments — at least in her province.

There’s also significant room for improvement when it comes to people’s awareness of economic abuse, from housing to health care. According to the CCFWE, roughly two-thirds of social and health-care workers have no training in screening for economic abuse, which is why the organization has launched a screening tool for service providers.

But the biggest impact would probably come from the financial industry, since it’s where the vast majority of economic abuse occurs. “In Australia and the United Kingdom, programs are now set up in banks to help victims of economic abuse,” says Haileyesus, referring to recent initiatives that make it easier for survivors to access credit and private personal bank accounts.

Earlier this year, one British bank changed its app to allow users to mute the messages that accompany money transfers, so they can avoid seeing any threats abusers might send with alimony or child support payments. While that may sound like a minor change, compared with repairing damaged credit, it’s an instructive example of the many systemic gaps and oversights that allow economic abuse to continue, even after a relationship has ended.

Unfortunately, banks in Canada still have a lot to learn in this area. “Simply put,” Haileyesus says, “due to a lack of awareness and a lack of policy, our banking system is not designed to help these victims.” Earlier this fall, the CCFWE launched a national scorecard on economic abuse that included policy recommendations targeting the financial sector. 

For Nikolova, these gaps have immediate real-world repercussions on survivors that hinder recovery and positive mental health outcomes. According to her research, this is especially so for Indigenous and African, Caribbean, and Black women, who typically suffer greater discrimination from the legal, health-care, and financial systems. “We now measure financial stress as one of the assessments with survivors to see how that’s impacting them, and we have found that it’s very highly correlated with things like anxiety, depression, and worsening PTSD symptoms,” she says. “We are seeing that even five or 10 years after a relationship has ended, women who have experienced economic abuse are still at a lower socio-economic status than their peers.”

Williams continues to deal with her ex-husband’s put-downs and ongoing financial abuse several years after being apart. “He always says I’ll never make it on my own, which certainly isn’t the case,” she says. “It’s almost like the abuse continues and adds insult to prior injury, so you’re not able to just focus on healing and getting your life back in order, which is hard since I’m trying so hard to be in rebuild mode.”

Despite these challenges, Williams is confident that her newfound commitment to independence — something she wants to model for her kids — will make it possible for her to recover from the economic abuse. It’s that hope that gets her through the daily struggle of balancing work, parenting, retraining for a new career, and dealing with the courts.

Further reading: The Day I Decided to Leave: The Catalyst

Resource: Support services from across Canada from the Canadian Women’s Foundation.