EXPLAINER: In New Zealand, Canada, Australia and the UK, Friday is Economic Injury Awareness Day.
This is the third time the event has taken place in Canada, but this is a first for New Zealand, so the term âeconomic damageâ needs to be explained.
And so does the insidious complicity of the finance and business sector.
Economic abuse is an unrecognized form of domestic violence, says Nicola Eccleton, head of social inclusion at Good Shepherd, and economic harm is the result of that abuse.
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* Family violence and animal abuse: he killed his partner’s cat to control her
* “I can always reach you”: bank payment references used to send thousands of abusive messages
* Money should not be a barrier to accessing help in cases of violence
Economic violence tends to be classified as a form of psychological violence and is classified in the Family Violence Act 2018 as psychological violence.
A recent study from the University of Auckland suggested that it is on the rise, perhaps because people who abuse their partners may view it as a low-risk abuse option, as it is rarely prosecuted or recognized. .
But economic abuse has its own characteristics of harm, which is why Good Shepherd, a charity that exists to support women, including with free and low-cost ‘good’ loans, is calling for making it a crime. in its own right. .
Kathryn George / Stuff
Domestic violence is not always a scene in Once Were Warriors. Most often, these are men controlling the women, sometimes without any physical violence. (Video first published in September 2020)
What is economic abuse?
Economic abuse is “the weapon of money” by a controlling intimate partner, says Ayesha Scott, a researcher at AUT.
This can involve a lot of abusive behavior; denying the victim access to accounts, information and decision-making rights, severely limiting their purchasing choices and making them accountable for every penny spent.
And it’s abuse that can continue even after a victim escapes from a relationship, if they’ve been forced into debt for their partners, like buying a car.
Victimization Continues After Abuse Ends
Natalie Vincent, managing director of social lender NgÄ TÄngata Finance, says not a week goes by without a woman forced into debt seeking help from her organization.
This week was no different.
âHe forced her to take on debt on his behalf. Now he’s passed her, and she has debt collectors chasing her. We hear that all the time. It’s horrible, âshe said.
Lenders know this is happening and sometimes, when faced with evidence of economic exploitation, they write off or reduce debt, she says.
It’s not just the lower level lenders. It is also a bank debt. And consumer debt, says Vincent.
âIt happens with buy now, pay later. It’s registered in his name, but he’s busy accumulating all the debts, âshe said.
“This has been going on for years. Women take car loans for adult partners, adult sons all the time, and these people disappear and are left with debt.”
Unintentional props to crime
Banks and other businesses like power companies are starting to realize how they unwittingly become props for abuse.
âWe’ve seen it with transaction abuse,â Scott explains. where abusive messages were sent in the reference field on bank payments.
Banks hadn’t looked at what people wrote in the text section during a transaction, she said.
âWhen they looked, they were horrified,â Scott says.
Abusers, including those who harassed former partners, used online banking services to continue harassing their victims.
Last year, ASB amended its terms and conditions to “make it clear that it is unacceptable to use the services of ASB to harm, harass, abuse, intimidate or encourage physical or mental harm or violence”.
Bank of New Zealand and Westpac have pledged to “take the bank away” from the attackers.
For Scott, this sudden awakening reveals how easy it is for companies to unwittingly facilitate economic abuse.
“We’re looking to say, ‘Wait, this isn’t fair’ and ‘hang in there, the organizations and institutions in our financial system, whether they are telecommunications companies or power companies, have a role to play here, âshe said. .
Is the finance and business sector also actively complicit?
Certain policies of banks, other lenders, and power companies facilitate economic abuse.
If a man has a bad credit history, his partner may be the only one who can open a Power account.
He enjoys the benefits of power, but if the bill is not paid, it is she who is sued for the debt.
Lenders do not always diligently check that there are no secret beneficiaries of their loans, as in the case of a loan to buy a car for a coercive partner.
Joint loans are also âjoint and severalâ, which means that lenders, including banks, can sue only one of the borrowers for the money.
Too often they go after the woman, Eccleton says.
She’s often the easiest to find, she says. She is often more invested in the payment, if she is responsible for the children. She needs energy to stay on. She needs a good credit rating if she is to have any hope of getting a decent rental.
âIt’s easy for the lender to keep up with who’s paying. There is no real incentive for them to go and chase the other person. It’s a very easy outcome for the lender, âshe said.
Change the rules
Activists are starting to think about how things need to change.
Should the power companies save the two adults in a relationship on the electric bill and split the debt evenly, should we make a runner?
Should lenders dig deeper for possible economic abuse before granting loans?
Should we create new laws on the equitable sharing of loans after the end of a relationship between co-borrowers, in particular by not penalizing one of the co-borrowers when the other refuses to pay?
Eccleton gives the example of a joint loan that she saw recently.
âThere is a car loan in place. He no longer reimburses. The lender has said there is nothing he can do … the penalties pile up until he pays them. This affects his credit rating. She already has a protection order in place and the lender doesn’t have to suspend those penalties, which I find amazing, âshe says.
Dame Diana Crossan, president of Good Shepherd, says there is still a lack of understanding and awareness of the issue, which has resulted in poor identification, protections and support systems.
âTherefore, economic harm is a form of abuse largely ignored in Aotearoa, although it affects all socio-economic groups, locations, sexual orientations and cultural backgrounds. “
Crossan, a retired former commissioner, began her career as a probation officer.
She sees economic harm and abuse as the third major societal step in combating abusive relationships.
âIt took a long time for physical violence in a relationship to be considered a crime. When I started out as a probation officer, police policy was not to interfere with a “servant,” she says.
âWe then moved on to psychological abuse. It took a long time for people to understand how well people can control psychological abuse. “
Should economic abuse be a stand-alone crime?
This is worth considering, especially because it would then be necessary to discuss sanctions.
One of them could be to give the courts the power to reallocate debts, so that the harm caused by economic abuse does not continue to plague the life of the victim-survivor.
âThere has to be a conversation about what happens if this relationship ends, and that’s not something that’s happening right now,â Eccleton said.
âYou should absolutely be able to reallocate the debt. The continuing impact on someone’s ability to dominate the other with violence, who will then spend the next five years paying off the debt, âshe said.