The British legal system is lagging behind when it comes to protecting victims from economic abuse, which can affect a ‘surprising’ number of UHNW women, according to prominent family lawyers.
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One in five women in the UK have experienced economic abuse – defined as any behaviour that has a substantial adverse effect on an individual’s ability to acquire or use money, property, goods, or services – at the hands of a partner in the past year, figures show.
It is one of the ways coercive and controlling behaviour is perpetrated in abusive relationships, with 95 per cent of domestic abuse victims experiencing economic abuse, according to Surviving Economic Abuse.
The topic is the subject of a new report from the Domestic Abuse Committee that puts forward proposals on how best to address economic abuse in financial remedy proceedings.
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Leading voices from the Spear’s network explained it is perhaps ‘surprising’ to learn that UHNW women can find themselves particularly vulnerable.
‘It’s a surprise to many that these multi, multi millionaires could be experiencing economic abuse, but the lifestyle very much lends itself to this,’ said Ceri Griffiths, a Spear’s Top Recommended adviser who specialises in supporting women divorcing from wealthy partners.
Griffiths highlighted 10 main manifestations of economic abuse in UHNW relationships. They include work inhibition, property ownership deception, controlled charitable donations, denial of access to financial information, investment ignorance, credit card dependency (where access can be cut off without warning), and cash control (where an individual is left without liquid funds for personal or emergency use).
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All of these coercive control tactics are underscored by a power imbalance, with one spouse having control over the matrimonial assets.
These behaviours can emerge during the course of a relationship, explained Hunters Law partner Olivia Piercy, a Spear’s Top Recommended family lawyer whose Master’s degree focused on gender violence.
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She continued: ‘Wealthier people are often preyed upon. I have seen very wealthy women enter relationships with financial independence; by the end of the marriage, they don’t know which of their assets remain and they don’t have access to them.
‘Something else I see time and time again is that the wife’s pre-acquired wealth and inheritance becomes joint money, whereas the husband’s inheritance and pre-acquired assets remain as separate, and the law protects that… allowing his assets to be ring-fenced.’
Economic abuse does not necessarily end with separation, with 25 per cent of female victims reporting that they continued to experience abuse after leaving their partner.
‘Post-separation abuse can be just as bad, or worse, as the abuse that happens during the course of the relationship,’ Piercy told Spear’s. ‘It just finds new channels.’
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Finances and child arrangements are the main channel of post-separation abuse, with perpetrators hiding assets, failing to provide financial disclosure, and cutting off financial support. This can cause the victim to fall under extreme financial pressure, unable to afford lawyers or advisers.
UHNWs are particularly vulnerable during financial remedies proceeding because, in Piercy’s words, ‘people who have a lot of money are very clever with their money’.
‘They can wrap it all up in trusts. They put it in companies abroad, which disappear into companies, into other companies,’ she says. If an individual doesn’t have access to a team of legal and financial experts, they are extremely vulnerable to continued abuse.
Instead of protecting people from economic abuse of this sort, Piercy believes the legal system is ‘facilitating it’ and not protecting victims from ongoing, post-separation economic abuse.
Both Piercy and Griffiths are part of the Domestic Abuse Committee, a multi-disciplinary working party — led by Resolution — which aims to stop the facilitation of economic abuse.
The report, which surveyed more than 500 family law and domestic abuse experts, contains a list of proposals that seek to adjust the legal system in practical ways.
Griffiths revealed that one specific proposal asked for a ‘change of how clients have access to funds for their divorces,’ avoiding the currently difficult legal process of victims requesting funds from their abuser. ‘If you haven’t got access to money, you haven’t got access to fair legal proceedings,’ she added.
