‘My ex-husband left me £58,000 in debt’: Lloyds Bank launches new tool to help prevent economic abuse and support victims
- In total, victims of economic abuse are forced into millions of pounds of debt
- Nearly half are left with priority debts – meaning they could lose their home
- A victim says she racked up £58k of debt supporting her abusive husband
- Only one in four victims get their debt written off as a ‘gesture of goodwill’
Lloyds Banking Group is launching a new tool that will help to identify economic abuse, verify evidence of coerced debt and prevent such incidences from escalating further.
The Economic Abuse Evidence Form has been developed together with Surviving Economic Abuse, a charity trying to tackle the problem.
It comes as three in five domestic abuse victims have been forced into debt by their partners, according to data from SEA.
The average debt per domestic abuse victim is £4,600 with a typical person being indebted to an average of five creditors.
Money control: According to Surviving Economic Abuse 60% of domestic abuse victims have been forced into debt (picture posed by models)
The EAEF is a document that can be filled out by a debt or money adviser on behalf of a customer to inform financial institutions that their client is a victim of economic abuse.
The charity adds that as the UK faces a winter of social restrictions it’s become more critical to open up new safe spaces within which victims can disclose abuse and be offered help.
Last year, SEA supported and advised Lloyds Banking Group on the launch of its Financial and Domestic and Abuse Team. It also provided training to staff members on how to spot the signs.
As part of the partnership, SEA’s banking specialist Jenn Glinski has been seconded to the Lloyds Banking Group specialist Financial and Domestic Abuse Team.
The collaboration means that SEA’s expertise can be drawn upon to help with vulnerable customers and staff that are victims of economic abuse.
The collaboration comes two years on from the launch of the Financial Abuse Code of Practice by UK Finance.
The code is a framework for helping the banking sector recognise and support victims of abuse and many banks and building societies have signed up to it.
I held down three jobs to support my husband’s lavish lifestyle and racked up £58k of debt
Sophie Lewis* says the abuse started when she met her ex-husband. They were meant to contribute to the joint account equally, but she soon found herself as the only contributor.
She says: ‘He was setting up direct debits through the joint account and refusing to put any money in.
‘When I went back to work, he refused to contribute to any costs of our daughter for childcare and he said it was me that had to pay if I want to go back to work.
‘Over time it got a lot worse as we had three children and I was paying for all of them and I was literally putting my entire wage into the joint bills account.
Her husband would also mentally abuse her and get physically violent. She says: ‘He would smash things up and I’d have to replace the broken items. I had to take a night job to cover the costs. Once he logged onto our account and splurged £800 in one night.
‘He worked and had a good income. I left him and in 2004 and at the time he was earning £50,000 a year. He would spend all his money on high end items. He’d become obsessed with new hobbies and want the best quality of everything.’
She had to pay of £58,000 worth of debt after she left her husband. Sophie advises other victims to reach out for help.
She says: ‘A lot of people don’t know that you don’t have to go to a refuge immediately. Support workers can meet you in your office so you can discuss the leaving options safely.
‘Also, speak to your financial institution as there is a lot of work going on about this kind of thing and many do have measures in place to address this sort of thing as do Citizen’s Advice.’
*Not her real name
It means many institutions are now committed to inform victims of domestic abuse about assets and liabilities in their name.
Fiona Cannon, group sustainable business director said: ‘Domestic and economic abuse is a key business issue for us.
‘Surviving Economic Abuse have been instrumental in the creation and training of our dedicated specialist support team which launched at the end of last year.’
What is economic abuse?
Dr Nicola Sharp-Jeffs, founder and chief executive of SEA highlights that economic abuse can take four different forms.
Abusers will typically prevent access to economic resources and control spending.
Dr Shap-Jeffs explains: ‘This might include efforts to work or study, insisting victims’ wages are paid into the perpetrator’s bank account, preventing a victim from claiming welfare benefits, or denying their partner access to any personal or joint bank accounts.’
Abusers could also refuse to contribute to the cost of running the household or bringing up children (and spend money on themselves only) or will exploit the victim’s economic resources, using coercion or fraud to run the victim into huge debt in the victim’s name.
Dr Nicola Sharp-Jeffs, founder and CEO of Surviving Economic Abuse. The organisation has collaborated with the Lloyds Banking Group to create a tool which identifies economic abuse
The majority of victims of economic abuse are women.
Dr Sharp-Jeffs says victims are left millions of pounds in debt that threatens their livelihood.
She says: ‘In total, victims are left to foot the bill of £23.5million in coerced debt each year.
Ultimately consumer law must be reformed so that coerced debt is recognised, victims can seek redress, and perpetrators are held accountable
Dr Nicola Sharp-Jeffs – SEA founder
‘Furthermore, 44 per cent were left with priority debts – meaning they were at risk of losing their home or having utilities cut off.’
Most financial institutions still, however, hold victims of abuse accountable for their own debt.
Dr Sharp-Jeffs says some institutions write off the debt as a gesture of goodwill but that this practice is inconsistent.
She adds: ‘One in four cases are successful. The EAEF is a start but SEA is calling for the financial services sector to adopt a consistent policy position on coerced debt.
‘Ultimately consumer law must be reformed so that coerced debt is recognised, victims can seek redress, and perpetrators are held accountable.’
SEA believes that banks can play a crucial role in identifying debt derived from economic abuse, potentially stopping it from escalating, and assisting the victim-survivor in rebuilding their lives.
What can you do?
There is support available for those worried about their safety and economic situation. SEA says there are some immediate steps you can take.
It advises taking any one of these actions if it is safe to do so:
1. If you are in immediate danger, call 999.
2. Call the National Domestic Violence Helpline on 0808 2000 247. It is a confidential, 24-hour service run by Refuge. There is a helpline for men as well called Respect, which can be contacted on 0808 8010 327.
3. Contact your local domestic abuse service. This can be found on the Women’s Aid website: womensaid.org.uk
4. Get expert money advice from the Financial Support Line for Victims of Domestic Abuse (created in partnership with SEA and Money Advice Plus) on 01323 635 987.
5. Organisations such as StepChange and National Debtline also have qualified advisors trained to offer specialist debt advice.