The invisible chains: recognising economic or financial abuse in mediation

A seemingly amicable mediation session can hold hidden depths of power imbalance and control, especially when economic abuse lurks beneath the surface. As mediators, our ability to decipher subtle behavioural nuances is crucial to ensuring a safe and equitable process for all parties.

This becomes especially crucial when dealing with issues of economic or financial abuse, a form of control and an act of domestic abuse, often veiled in ambiguity and silence.

Economic abuse is a type of abuse that differs from financial mismanagement in its deliberate use of finances and resources to gain power and control in a relationship. Its end goal is to create a sense of dependence, limit opportunities, and perpetuate a cycle of fear and isolation. Unlike other visible forms of abuse, like physical or verbal aggression, economic abuse can often be elusive and tough to uncover. However, with a trauma-informed mediator leading the way, subtle hints and cues can reveal the underlying dynamics at play. As you guide couples through mediation, make sure to keep a watchful eye and stay attuned to these intricate dynamics.

Look for these telltale signs that may indicate the presence of economic abuse:

■ Power imbalances in financial conversations:

• One individual dominates discussions about finances: There is a noticeable pattern of one person consistently guiding the conversation, making all the decisions, and shutting down any inquiries or disagreements. This unequal distribution of control, even if disguised as “expertise,” may indicate an imbalance of power.
• One participant shows a lack of understanding or interest in financial matters: Although directly affected by financial decisions, one party surprisingly lacks knowledge and involvement in shared finances. This behavior may be a deliberate tactic to keep the other person unaware and dependent.
• One individual displays an unusual defensiveness around money: Any mention of finances or suggestions regarding money triggers an excessive defensive or angry response. This individual dictates how much the other earns and how they spend their money.

■ How money is controlled:

• Inequitable split of joint expenses: One party bears a disproportionate share of financial responsibilities while the other enjoys a greater degree of financial freedom. This lopsided distribution can create a power dynamic that fosters dependence and manipulates priorities.
• Unjustified constraints on income or expenditures: One participant exerts strict control over how much the other earns, how they allocate their funds, or even mundane purchases. Such restrictions strip away autonomy and reinforce reliance on the controlling party.
• Financial coercion: Threats like “If you leave, you’ll lose everything” or “You can’t survive without me” are used as means of exerting control and inducing fear through financial means.

 ■ Behavioural patterns indicating dependence and fear:

During discussions about finances, one participant’s behavior reveals signs of anxiety and fear. This can manifest through fidgeting, avoidance, or even tears, suggesting possible emotional manipulation and an underlying fear of consequences. On the other hand, another participant frequently defers to the wishes of the other person, neglecting their own needs and potentially suffering negative financial consequences. This could be a learned behavior stemming from a fear of conflict or retaliation. Additionally, one participant openly expresses a sense of hopelessness about their financial future. They feel trapped and unable to escape their current situation, highlighting the detrimental effects of financial control.

■ What to do next?

Recognising these subtle signs is just the first step. Once identified, it’s crucial to create a safe environment where the victim feels empowered to share their experiences without fear of judgment or reprisal.

Here are some steps you can take as a mediator:

Immediately prioritise safety:

• • • Acknowledge the potential for abuse: Take a moment to have a one-on-one conversation with the person who is experiencing abuse, acknowledging the unequal power dynamics and prioritising their safety. Reassure both parties that any conversation during mediation will be kept confidential and that your top priority is the well-being of everyone involved.
    • Provide individual sessions: If feasible, create separate environments for each party to openly discuss their circumstances and desires without fear of being threatened or punished.
    • Refer to support services (if appropriate): Share details and contacts for organisations such as legal aid, financial advisors, or shelters for victims of domestic violence, stressing the importance of privacy and encouraging them to seek additional assistance.

Shift the focus and communication:

• • • Reframe the power dynamics: Gently but firmly challenge any dominating or controlling behaviour, ensuring both parties have equal opportunities to voice their needs and concerns.
    • Redirect conversations towards empowerment: Move the focus from blame and accusations to constructive problem-solving, enabling the victim to participate actively in finding solutions.
    • Emphasise fairness and transparency: Encourage complete disclosure of financial information, ensuring both parties have access to all relevant details before making decisions.

Set boundaries and limitations:

• • • Address threats and manipulation: Directly confront any language or behaviour that creates fear or coerces decisions, making it clear that such tactics will not be tolerated in the mediation process.
    • Postpone or suspend mediation: If safety is a concern or the power dynamics are hindering progress, it may be best to postpone or suspend the mediation. This will allow the individual to feel more secure and in control before moving forward.
    • Get support from experts: In more intricate cases, enlist the help of legal professionals or financial advisors to ensure the victim receives the necessary assistance and protection during the mediation journey.

■ The section 2B of the Domestic Violence Act 14/21 conundrum when it concerns domestic abuse in children, disabled people and the elderly:

This section provides that a mediator who knows, or believes or suspects on reasonable grounds, that an act of domestic violence has been committed against a child, a person with a disability or an older person, must report such knowledge, belief or suspicion as soon as possible, to a social worker or the South African Police Service. While the reporting duty is quite clear the conundrum extends to the definition of an act of domestic abuse where a child is ‘exposed to domestic violence’ where they (a) see or hear domestic violence (by the parents); or (b) experience the effects of domestic violence (such as non-payment of child maintenance) and the duty to then report the matter. At present there are no clarity in case law regarding the process that needs to be followed by mediators when confronted by issues of economic and financial abuse that affects children indirectly.

Written by Eugene Opperman (B.Proc. LLB.) (LSSA L.E.A.D., ADR Network, FAMAC) , a legal practitioner and accredited mediator. 11 February 2024.