Financial Abuse

19 March 2025 in Family and Divorce Law | 5 min read | skip to FAQs

This article explores financial abuse within a domestic relationship and the legal remedies that are available to address such abuse. We also discuss the issue of coercive control.

What is Financial Abuse?

Financial abuse is a form of domestic abuse. It occurs when one partner exerts control over the financial resources of the couple or either partner, which limits the ability of the effected partner to earn, spend or manage money. This can include providing an unreasonably small allowance, preventing their ability to work outside the home or have a separate or access to a shared bank account. It can also involve taking out loans or building up debts in the other person’s name. This can often create a cycle of dependency, which ultimately undermines the victim’s autonomy and security. In Australia, this can significantly affect and be addressed in family law proceeding such as divorce, property settlements and spousal maintenance.

What is Coercive Control?

Coercive control can involve financial abuse. Coercive control involves a pattern of abusive behaviour that creates fear and restricts a person’s freedom and independence. This type of abuse is most often seen in intimate partner dynamics and sometimes continues post-separation.

Coercive control occurs when ‘someone repeatedly hurts, scares or isolates another person to control them’. There are many examples of this behaviour including violence, threatening, limiting freedom, harassing, monitoring and stalking, shaming, social isolation, sexual abuse and emotional abuse. Coercive control can also involve financial abuse. Some victims may not immediately recognise the subtle signs of coercive control. Some of the signs of coercive control include the following:

1. Preventing an individual from seeing friends and family by controlling their social interactions, e.g. taking away their phones
2. Preventing access to resources and support systems
3. Using technology to track or monitor a persons movements
4. Controlling all household finances and preventing an individual from working or accessing their own money
5. Emotional abuse such as belittling or humiliating the individual on a constant basis, e.g. sharing private information or making jokes that harm their dignity
6. Forcing an individual to engage in sexual activities or using sexual activities as a means of control
7. Dictating what the victim can wear, eat or how they should behave.

In an attempt to address the above issues, the NSW Government recently passed the the Crimes Legislation Amendment (Coercive Control) Act in November 2022. This change to the Crimes Act 1990 (NSW) criminalised coercive control in NSW from 1 July 2024. It aims to identify domestic violence early to assist victims of domestic violence through early intervention. The offence of Coercive Control (called abusive behaviour towards current or former intimate partner) carries a maximum penalty of up to seven years imprisonment. For further information, please see our dedicated article on coercive control.

The Signs of Financial Abuse

Section 4AB of the Family Law Act 1975 (Cth) defines family violence to include,

“g) unreasonably denying the family member the financial autonomy that he or she would otherwise have had;

h) unreasonably withholding financial support needed to meet the reasonable living expenses of the family member …”. 

This is a broad definition that protects any family member from a wide range of financial abuse. Recognising financial abuse can be challenging, particularly when the victim is in an intimate relationship. Some common behaviours that may indicate financial abuse include:

1. Monitoring or dictating how either partner’s or shared money (together this can be considered as household money) is spent;
2. Forcing an individual to make financial commitments or sign contracts;
3. Preventing access to bank accounts;
4. Preventing access to financial information such as bank statements or tax returns;
5. Incurring debts in the victim’s name without consent;
6. Preventing access to resources and support systems; and
7. Hindering or preventing the victim from finding suitable employment.

What Can The Court Do?

Part VIII of the Family Law Act 1975 (Cth) provides the court with several options to assist victims of financial abuse, including:

1. Courts can issue injunctions to prevent a partner from selling or otherwise mishandling shared assets;
2. Courts can order spousal maintenance be paid where there are cases of immediate financial need, such as a party requiring money to be paid while legal matters are resolved; and
3. The Court may adjust property settlements to reflect the impact of financial abuse on the victim’s financial standing.

As set out above the Court’s powers are far reaching and broad. For instance, section 79 of the Family Law Act 1975 (Cth) provides that the Court may alter the property interests of each party and such property includes real estate and bank accounts. Court orders such as these can be sought to address and remedy financial abuse.

Financial Abuse recognised as Family Violence in 2025

The Family Law Act Amendments (FLAA) in 2024 legislated significant amendments to the Family Law Act 1975 (Cth) (the Act) which commenced on 10th June 2025. For more information on this topic please see our dedicated article, Family Law Changes in 2025.

Schedule 1 of The FLAA has introduced a definition for economic or financial abuse in s4 of the Act. Behaviour that may constitute economic or financial abuse is set out in s4AB(2), and is briefly summarised below:

1. Unreasonably denying the family member financial autonomy;
2. Unreasonably withholding financial support needed to meet the reasonable living expenses of a family member or the family member’s child;
3. Coercing a family member (by threats or abuse) to give or seek money or other items as a dowry; or
4. Hiding or falsely denying things done in connection with the practice of a dowry.

New Definition of Financial Abuse as Family Violence affects Property Settlement Orders

S19 of Schedule 1 of the FLAA has introduced amendments that requires the Court to consider the effects of family violence when making property settlement orders. Specifically, “the effect of any family violence, to which one party to the marriage has subjected or exposed the other party”. This is considered under considerations relating to contributions, formerly known as contributions factors.

Family violence must therefore be considered when making orders regarding maintenance, alteration to property interests, parenting orders and superannuation splitting orders.

In relation to property settlements, financial abuse was previously not recognised as family violence. The amendment now addresses the power imbalance and exploitations that may occur through economic and financial abuse and will now be considered in any Court order relating to property settlement.

How Can BSM Sydney Lawyers assist you?

If you believe you are experiencing financial abuse, you should seek professional legal advice. Brander Smith McKnight’s family lawyers Sydney have the legal expertise, compassion, empathy and professionalism to assist and advocate for your best interests. Our family legal team will ensure that you get a fair and equitable outcome. BSM Sydney lawyers have expertise in family and divorce law and are up to date with the most recent changes and legislative amendments. Our legal team will protect your rights. BSM Lawyers Sydney provide a free, no obligation, 20-minute consultation.

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BSM Lawyer Sydney has conveniently located offices in Sydney CBD, Sutherland, Parramatta, Shellharbour and Wollongong.