Canadian banks have a role to play in preventing domestic violence

An abusive ex weaponized e-transfers before killing Angie Sweeney. Banks can do more to protect domestic-violence victims in the short and long term. (Pexels Photo)

By Policy Options

After breaking up with her abusive boyfriend, Angie Sweeney blocked him from all her social media and messaging accounts. She couldn’t stop him from sending countless e-transfer payments to deliver threats and intimidations through the optional message field.    

Her ex-partner killed Sweeney just a few days later. That same night he drove to another former partner’s home, where he injured her and killed their three children before turning the gun on himself. The shootings left the small community of Sault Ste. Marie, Ont., in shock and with many questions on how the violence could have been prevented.    

Many victim-survivors with similar experiences came forward after the news broke. They spoke of difficulties when reaching out to banks for help, often being told nothing could be done. The CBC contacted all of Canada’s major banks for a follow-up story in April. None responded directly but deferred to the Canadian Bankers Association (CBA). 

E-transfers as a means of abuse    

The Canadian Center for Women’s Empowerment (CCFWE), together with Women’s Shelters Canada, wrote an open letter to major banks, Interac and the bankers association demanding action on this prevalent problem. The organizations pointed to the United Kingdom and Australia, where financial institutions have implemented successful ways to prevent e-transfers as a means of abuse.  

The Commonwealth Bank of Australia has developed an AI-generated message tracking system that detects offensive language in e-transfers. Since 2020, the bank has blocked around 400,000 messages annually. The project has proved so successful that the bank has offered its technology for free to any financial institution in the world.   

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U.K.-based Starling Bank took a different approach. It implemented a “hide reference” feature that allows users to black out messages from specific senders while still receiving the transfer.  

Both methods have been effective and, adapted to the Canadian context, offer tangible solutions for financial institutions in this country.  

In response to the open letter, the Canadian Bankers Association and Interac have said they will address the issue of e-transfers in the context of domestic violence. This is a welcome commitment, but advocates want to see action. 

Broader challenges with the financial sector  

While media attention has focused particularly on e-transfers, it is only one problem that abuse victims and survivors face with banks.  

Victim-survivors see financial institutions as one of the least helpful service providers, a CCFWE 2021 study found. Based on consultations with victims, survivors and social services, three main challenges were identified:  

1. Weaponizing of financial products: Continued control and threats – such as through e-transfers – as part of post-separation abuse have severe effects on the mental health of survivors. The exploitation of financial products can also have profound financial ramifications for them. For instance, with increased digitalization, abusers can open a credit card in a victim’s name without their knowledge or consent and build up debt that the victim is held accountable for. Current legislation in Ontario to address coerced debt only applies to survivors of human trafficking. Without a legal framework or resources for legal aid, domestic-abuse survivors are often forced to take on the financial burden of their abuse.
2. Absence of trauma-informed services and knowledge of financial abuse: Without proper support, victim-survivors can be retraumatized and feel alone and misunderstood. A lack of understanding about the issue can have serious implications for women’s safety. Victim-survivors have reported that financial institutions, despite being informed of domestic abuse, shared personal information like new addresses or phone numbers with a former partner still listed as a joint account holder. This can jeopardize the physical safety of survivors and their children.
3. Lack of access to financial services and products: Missing identification documents or low credit scores as a direct consequence of abuse often prevent survivors from opening a bank account or applying for loans. After fleeing violence with little to no money, survivors often can’t obtain even small amounts in advance to get back on their feet. Benefits take time to arrive and require a bank account. Without access to traditional financial services, many survivors turn to predatory lenders. This leaves them vulnerable to further exploitation and debt, and perpetuates the cycle of poverty and violence.  

Tangible solutions for Canadian banks  

Economic insecurity is one of the main reasons why women stay in abusive relationships or are forced to return to them. They literally cannot afford to leave. 

The Canadian Center for Women’s Empowerment is urging provincial and territorial governments to make the economic safety and security of survivors a priority as they implement the National Action Plan to End Gender-Based Violence.    

But it is not solely a governmental responsibility. The private sector, particularly the financial sector, also has a part. In Australia, a parliamentary inquiry is examining the role of banking institutions in the context of domestic violence and their duty in preventing financial abuse.   

In consultations with victims and survivors in Canada, the CCFWE learned that banking staff are often the first contacts for victims to share concerns about potential financial abuse, even before talking to family or friends. Especially in Black, Indigenous and people of colour (BIPOC) populations, taboos around money often hinder victims from openly talking about being  abused. Financial institutions are in a unique position to detect and prevent further financial abuse. 

Addressing the daunting task of making financial services more equitable and inclusive for survivor clients can seem overwhelming. But there are small, tangible steps financial institutions can undertake. Staff training programs or modifying product features to enhance security and autonomy for vulnerable clients can contribute to meaningful progress.   

The CCFWE last fall released a report highlighting successful initiatives in the U.K., Australia and Canada. Also included are a dozen recommendations for Canadian financial institutions to provide tangible solutions in the short, medium and long term. These include:  

• Accepting alternative documents for identification.  

• Bringing in front-line staff training and client communication material. 

• Developing abusive transaction monitoring of e-transfers and a “hidden reference” feature to detect abuse. 

• Enhancing online credit-card application verification. 

• Offering specialized assistance for survivors in certain bank branches that employ trauma-informed staff. 

• Establishing the ability to flag economic abuse in joint accounts. 

• Designing branches as “safe spaces” for victim-survivors. 

Significant legislative reforms are crucial for any substantial change in how banks approach clients who have suffered abuse. But financial institutions need to do their part by initiating more tangible measures while gradually working toward larger policy changes. That way, the financial sector can play a pivotal role in safeguarding the economic well-being and independence of domestic-violence survivors. 

This article first appeared on Policy Options and is republished here under a Creative Commons license.