Banks should make more thorough checks on new loans, all holders of joint insurance policies should be notified of changes and the tax office should take control of child support payments under sweeping changes proposed to protect domestic violence victims from financial abuse.

A landmark examination of financial abuse and how Australia’s systems respond has made 61 recommendations where a cross-party committee unanimously wants the sector and the Federal Government to act.

The committee said it was “astounded” at the scale of financial abuse and deeply concerned that products continued to be manipulated by perpetrators. It has been estimated to directly cost victims $5.7 billion a year plus a further broader economic toll of $5.2b. This includes almost $2b in unpaid child support.

“Financial abuse is not just heartbreaking, it is dangerous,” committee chair Deborah O’Neill said. “Government and financial institutions need to treat it like what it is — an immediate threat to life and safety.”

Financial abuse is a common form of domestic and family violence and can include controlling someone’s access to money or ability to work, racking up debt in their name, damaging someone’s property, refusing to pay child support or mortgage payments, or deliberately delaying settlements after a relationship breakdown.

The problem is pervasive across the whole sector: banks, insurance, buy now pay later, superannuation, car loans, mortgages and child support.

An estimated 1.6 million women (one in six) and 745,000 men (one in 13) have experienced economic abuse by a partner.

Labor MP Zaneta Mascarenhas, who pushed for the inquiry, said the committee had uncovered issues it did not anticipate.

“We’ve seen how systems and financial products are weaponised to inflict harm — harm that prevents victim-survivors from recovering and moving forward,” she said.

“Superannuation, credit and debit products, mortgage arrangements: all of these can be turned into tools of abuse.

“This must stop, and we all have a role to play.”