Financial abuse in a child/parent relationship Link
Parental financial abuse is a common form of child abuse. This is a complex issue where the parent uses money as a weapon to take advantage of a minor. This can be done by stealing a child’s money or by using their personal information for economic gain. It is important to know the warning signs so you can help prevent or stop the abuse. Sometimes parents will use a child’s information to apply for credit cards, take out loans, or to make big purchases they cannot afford. This leaves the child with damaged credit and severe debt before they even hit adulthood. This can leave the victim in a constant poverty struggle once they get older. Credit scores are looked at by employers, landlords, and banks. This can make it difficult for them to get a loan for college, a mortgage on a house, or a loan for a car. Financial abuse can cause lifelong damage to a child’s future.
Financial abuse can be hard to identify because it is invisible compared to physical abuse. Children most likely won’t know they have been financially abused until it is too late, and the damage is done. Some parents do not realize the negative consequences of exploiting their child’s money. Since it is hard for a child to know what is going on, it is important for adults close to the children to be aware of red flags for financial abuse. This form of abuse may be happening if a child has a credit report, receives credit or bank information in their name, a parent consistently takes the child’s gifted/earned money and never allows them to have access to it, a parent demands all money given to the child to be placed in the parent’s name, or if the child is punished for spending their own money.
If financial abuse is suspected, there are a few steps you can take. First, have a conversation with the parents if it is safe to do so. Some parents do not think through the consequences of these actions. Educating them can help put a stop to this abusive behavior. You can also obtain a credit report using the child’s name to see if there is any damage. This will also act as proof in any legal matters. The next step would be to contact the lenders to cancel and come up with a payment plan.
By: Rachel Salmon
Oct. 2022
Reference: What is financial child abuse? (n.d.). ENDCAN. Retrieved October 10, 2022, from
https://endcan.org/2021/10/21/3-forms-of-financial-child-abuse/
FAQs
Parental financial abuse is a common form of child abuse. This is a complex issue where the parent uses money as a weapon to take advantage of a minor. This can be done by stealing a child's money or by using their personal information for economic gain.
What are the behaviors of financial abuse? ›
Financial abuse can be when someone:
cashes in your pension or other cheques without your permission. adds their name to your account. pressures you to change your will in a way you're not comfortable with. has offered to buy shopping or pay bills with your money, but takes it, and doesn't use the money how you agreed.
What are the psychological effects of financial abuse? ›
This manipulation, primarily rooted in control over another's economic resources, can have far-reaching consequences for victims. What Is Financial Abuse? Emotional impacts: Victims might feel trapped, humiliated, and powerless. This stress can lead to anxiety, depression, and other mental health challenges.
What to do if someone is being financially exploited? ›
Here are some steps to consider taking:
- Talk to the older person. ...
- Gather more information or evidence as to what is occurring. ...
- Contact the older person's financial institution. ...
- Contact your local Adult Protective Services (APS) office. ...
- Contact law enforcement.
Economic and financial abuse involves someone controlling your ability to get, use or keep your money or economic resources. People who use coercive control might use economic and financial abuse as part of their abusive behaviour.
What are the red flags of financial abuse? ›
Giving away money, transferring assets to people, unusual spending behavior, checks being written to cash or the unexplained disappearance of cash or property are warning signs that something isn't right.
What are the symptoms of financial abuse in children? ›
confusion, distress or fear when financial anomalies are discussed. person expresses worries about theft, threats, coercion, or disappearance of possessions. unusual concern by abuser that too much money is being spent on the care of the person.
How is financial abuse proven? ›
Gather as much evidence as possible.
You need hard evidence to prove that the suspect exploited the senior financially. This could include bank statements, copies of processed checks, or copies of legal documents.
How do you fight financial abuse? ›
If you are concerned that you or someone you know is being financially abused, contact 1800 RESPECT (1800 737 732) for support and assistance.
What are examples of financial exploitation? ›
(e) Financial exploitation. - The improper use of an adult's funds, property or resources by another individual including, but not limited to, fraud, false pretenses, embezzlement, conspiracy, forgery, falsifying records, coercion, property transfers or denying them access to their wealth.
Parental financial abuse is a common form of child abuse. This is a complex issue where the parent uses money as a weapon to take advantage of a minor.
What is a financial bully? ›
It is characterized by attempts to control, use, or manage your financial resources. The abuser may take your money, control your ability to earn money, or create debt in your name, among other things.
What is the most common form of abuse in children? ›
Neglect is the most common form of child abuse. Physical abuse may include beating, shaking, burning, and biting. The threshold for defining corporal punishment as abuse is unclear.
What are examples of financial behavior? ›
So, what is behavioral finance? It's an economic theory that explains often irrational financial behavior, such as overspending on credit cards or panic selling during a market downturn. People often make financial decisions based on emotions rather than rationality.
What are the physical indicators of financial abuse? ›
unfamiliar, new or forged signatures on cheques and documents. the older person is unable to access bank accounts or statements themselves. large, unexplained withdrawals from bank accounts. sudden transfer of assets at a time when the older person may no longer be competent to manage their own affairs.
Which of the following indicates financial abuse? ›
Financial abuse includes: having money or other property stolen. being defrauded or scammed. having money, property, possessions or benefits misused.
What are the behavioral issues in finance? ›
Some common behavioral financial aspects include loss aversion, consensus bias, and familiarity tendencies. The efficient market theory which states all equities are priced fairly based on all available public information is often debunked for not incorporating irrational emotional behavior.
