Introduction to Financial Abuse
Domestic abuse is very common in intimate relationships—in Minnesota, approximately 1 in 3 women and 1 in 4 men report experiencing intimate partner violence or stalking during their lifetimes, and real numbers are likely much higher.[1] Domestic abuse statistics are often underreported, partly because victims and survivors of abuse may decline to define their negative intimate experiences as “abuse.” Often, when we think of domestic abuse, we think of physical abuse, but domestic abuse encompasses a wide range of behaviors by which one partner exerts power and control over the other.
An extremely common, but often overlooked, form of domestic abuse is financial abuse. Financial abuse occurs in approximately 99% of abusive relationships and is commonly seen in conjunction with other forms of domestic abuse.[2] There are many forms of financial abuse, but some examples include:[3]
- Your partner expects you to deposit your paychecks into a joint account, but doesn’t allow you to access the account, view the balance, or withdraw funds
- Your partner gives you a spending allowance or closely tracks your spending
- Your partner refuses to work or otherwise contribute to joint household expenses
- Your partner opens financial accounts in your name without your permission
- Your partner prevents you from working, limits your work hours, or sabotages your job
Abusers manipulate finances as a form of coercive control: by controlling their partner’s money or ability to work, an abuser aims to ensure their partner lacks the financial security to leave the relationship.[4] It is extremely difficult to leave an abusive relationship, and victims of financial abuse often experience additional obstacles because they lack the resources—whether assets, credit history, or work history—to support themselves independently of their abuser.
How does financial abuse factor into a divorce?
Attorneys and judges consider parties’ relative financial positions when determining awards of child support, spousal maintenance, and property settlements, and making other decisions in divorce proceedings. It is therefore extremely important to find a divorce attorney who understands your financial situation—especially if you have experienced financial abuse. Victims/survivors of financial abuse are often placed in vulnerable financial positions (due to having a low income, gaps in work history, or bad credit, for example) and abusers may attempt to exploit this to achieve favorable outcomes in the divorce. If you have experienced financial abuse, it is important to inform your attorney so they can take proper steps to secure your financial future.
At Lake Harriet Law, we use forensic accounting techniques to gather evidence of financial abuse during the marriage. Evidence that your spouse controlled or manipulated marital finances can counteract your spouse’s attempts to use your vulnerable financial position against you. We can also use motions to the court to help you secure funding for necessary expenses (such as food, rent or mortgage payments, and attorney’s fees) throughout the divorce proceedings, even if your spouse controls your financial accounts.
Minnesota law and financial abuse
Minnesota laws surrounding domestic abuse are unfortunately limited in nature, and therefore fail to protect many survivors of abuse. Minnesota Statute § 518B.01 limits its definition of domestic abuse to physical abuse, imminent threats of physical abuse, terroristic threats, sexual abuse, and interference with an emergency call. As a result, Minnesotans have extremely limited legal recourse if they have experienced financial and emotional abuse, although these forms of abuse are present in the vast majority of abusive relationships.[5]
Minnesota does provide limited recourse to victims/survivors of financial abuse through the State Attorney General’s Office: victims of financial abuse can request a security freeze on their credit reports, to prevent their abusers from negatively impacting their credit, or request a new Social Security Number to prevent identity fraud.[6] However, Minnesota needs updated domestic abuse legislation to adequately address the threats faced by victims/survivors of financial abuse. As other states, such as California, begin to expand their statutory definitions of domestic abuse to encompass financial abuse and coerced debt, we hope to see the Minnesota legislature follow suit.[7] In the meantime, Lake Harriet Law continues to employ creative methods to ensure the best possible financial outcomes for our clients.
At Lake Harriet Law, we work diligently for each client to obtain the best possible settlement. If you are considering a divorce, contact our team to begin designing a legal strategy to protect your future.
Randall A. Smith – Managing Attorney 612-750-4843
Sydney Koehler – Student Attorney 612-223-8925
Daphne Karofsky – Student Attorney 612-223-8925
[1] https://ncadv.sitewrench.com/statistics
[2] https://www.vfmn.org/financial-abuse
[3] https://www.thehotline.org/resources/what-is-financial-abuse/
[4] https://dfpi.ca.gov/2022/10/04/financial-abuse-is-domestic-abuse/
[5] Financial abuse is present in approximately 99% of abusive relationships, according to Violence Free Minnesota. Emotional abuse was present in 95% of calls to the National Domestic Violence Hotline in 2020. https://www.thehotline.org/wp-content/uploads/media/2021/06/Hotline-EOY-Impact-Report-2020.pdf [6] https://www.ag.state.mn.us/consumer/Publications/DomesticAbuse.asp [7] California Senate Bill 975. https://legiscan.com/CA/text/SB975/id/2609157