Financial abuse is one of the primary ways traffickers enforce control over the people they exploit, and how they profit from that exploitation. Finances are frequently used as means of control by traffickers to prolong exploitation, that is essentially the theft of financial freedom. Therefore, a survivor of human trafficking is a survivor of financial abuse.

Financial abuse can present in many different ways, from controlling how money is spent to evading legal obligations. Survivors of human trafficking most commonly experience forms of financial abuse that intersect with identity theft and fraud. In fact, 53% of respondents in Polaris’ National Survivor Study (NSS) shared that their bank accounts and credit were accessed and used by their traffickers during their exploitation.

As a result of these abuses, survivors are in extremely vulnerable financial circumstances after exiting their trafficking, and can be for many years after their exploitation ends. For example, survivors are twice as likely as the general US population to not have a checking account, and twice as likely to be unable to open a bank account due to identification, personal credit or past debanking from fraudulent activities on their accounts. This lack of access to basic financial tools and services leaves survivors isolated in cycles of vulnerability, which can lead to re-exploitation and even more barriers to stability.

Focus groups conducted with NSS participants also revealed that a majority of services for survivors, including financial access and support services, are concentrated in crisis response (shelter, transportation, law enforcement involvement, for example), typically the first 3-12 months after exit. Few exist to support survivors with their long term access and repair needs, such as credit building and repair. These services are needed to support survivors in sustaining economic stability long-term.

Polaris’s vision is focused on more than momentarily alleviating the economic situation of trafficking survivors, it is focused on long-term stability. That’s why, through collaborative efforts with trusted allies, we are working to establish referral pathways for survivors who encounter barriers to financial inclusion. Together, we are addressing the myriad challenges faced by survivors, building a resource ecosystem that benefits them, and fostering lasting systemic changes. Five innovative examples of efforts to increase access to financial products and services include:

1. The Debt Bondage Repair Act Guide was co-created by anti-trafficking subject matter experts and stakeholders, and provides step-by-step assistance and template documents for “survivors, service providers, government entities, and law enforcement on navigating the DBRA process.”
2. Finance Against Slavery & Trafficking (FAST) Survivor Inclusion Initiative (SII) has brought financial institutions and direct service organizations together to increase access to basic checking and savings accounts. Some institutions also offer products such as debit and credit cards and financial literacy education.
3. Survivor’s Guide to Money: How to Use Money as a Tool After it Was Used Against You as a Weapon is a financial literacy curriculum authored and informed by survivors. This curriculum has seen positive outcomes with survivors who independently go through the workbook, and is also used in residential and peer support groups across the US.
4. Moore Van Allen’s Online Financial Wellness Tool was co-created with Credit.com and is a customizable platform with online learning modules on topics ranging from foundational financial concepts to financial capability and wealth building, specifically designed for survivors of human trafficking.
5. Shyne’s Survivor Business Network provides comprehensive support, valuable resources, and capital for innovative ideas that challenge societal norms and systems by providing survivors with high-level, trauma-informed volunteer coaches to support survivors in wealth-building education opportunities.

There are many ways to get involved with promoting financial inclusion for survivors of trafficking, including supporting organizations that collaborate on this issue, and advocating for inclusive finance policies. Collective action and collaboration is the only way that we can build a more inclusive and equitable financial ecosystem that not only supports survivors of trafficking in gaining stability, but in reaching a stage where they are thriving.

Financial Inclusion: Available and accessible financial products and services. This includes but is not limited to: checking and savings accounts; credit building/repair; mortgages and business loans; building a savings cushion; home, life, and car insurance; remittances to family; paying off debt; personal credit cards and lines of credit; and financial education.

Financial Capability: An individual’s ability to act in one’s best financial interest, no matter their circumstances, to build economic stability.

Economically Thriving: A survivor of human trafficking who is economically thriving is a person who is securely rooted in their community; with sufficient material resources to be able to be in the present without grief, fear, or restraint from the past; and who has what they need to pursue their goals for the future. Economically thriving is having the freedom of unconstrained choices, and possessing the capacity to dream.

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The post Referral Pathways: A Collaborative Strategy for Financial Inclusion first appeared on Polaris.

The post In Harm’s Way: How Systems Fail Human Trafficking Survivors first appeared on Polaris.

This is a common problem for survivors of sex and labor trafficking. Traffickers take out loans in their names, wrack up debt on their credit cards, steal their identities and otherwise commit fraud that can wreak havoc on their victims’ finances for years after they break free. Later, when the survivor attempts to reclaim their lives, while hiding in safehouses or receiving extensive treatment for trafficking and often unable to work, their credit reports are further ruined. In this way, the trafficker keeps the survivor “in financial bondage” for years, even though the survivor is physically free from trafficking.

That’s why the Debt Bondage Repair Act, that became law in 2021, felt like a miracle to Samantha. After years of advocacy by survivors, there was finally going to be a process in place to help her and others like her rebuild their financial futures. Samantha at last saw a future in which she could own her house in her name.

Samantha swung into action, immediately reaching out to the larger consumer credit reporting agencies who create the scores and maintain credit reports to make sure she knew what she had to do. She was met with general confusion and received no answers. Again and again, Samantha found herself spending hours educating staff members at the largest credit reporting agencies about what they are legally required to do.

This was just the beginning but it did not get better from there. Survivors have to make the request to each individual agency and some respond better than others. But overall, the credit reporting agencies – many of which are multi billion dollar businesses – do not appear to have figured out how to provide this legally required service with confidentiality, accuracy, and within the new legal timelines.

Samantha documented every step of the process and her experiences give us insight into the work many survivors are currently undertaking to clear their credit reports. Because Samantha is not alone. Survivors have repeatedly reached out to Polaris to let us know that these new processes are not working as they are supposed to be. Here’s what Samantha experienced.

Document Submission

Samantha had to submit physical copies of her request and accompanying documentation to each of the agencies. To make sure she could track that her information was received, she sent her submissions by certified mail. That process is time consuming and expensive but she did it, creating a spreadsheet to track progress at both the big and small CRAs, and making daily visits to the post office both early in the morning and after work. But the team on the other end at one company, Experian, lost her submissions repeatedly, requiring her to submit the information several more times before the right person in the company received it – despite daily phone calls made by Samantha. Transunion, another major player in the industry, received and processed her mailed documents relatively quickly. However, they later closed Samantha’s online account so she was not able to check to see the status of her credit report.

Even once she reached the actual people who were supposed to see her documents, she was uncomfortable with the process of submission. These were extremely sensitive documents that told a deeply personal story; yet, they were nonetheless bounced around the building to different departments and seen by any number of people who should not have had access to them. Samantha knew that her sensitive trafficking documents were floating around Experian as she received confusing emails and letters from the Experian Fraud Department, the Identity Theft Department, and the general Disputes department over time. None of these departments were the ones who processed human trafficking submissions as she spoke to that department every day (Consumer Affairs). THAT department was lost as to where her private documents were in the building. One department (Fraud) that sent her mail, spoke to her on the phone and insistently told her that there was no such thing as a “Human Trafficking Block Request,” and she exasperatingly pleaded to speak to the manager to educate the multi-billion dollar company once again. Worse, while her personal documents were floating around, the clock was ticking – Experian had gone way past the legal timelines for processing her submission.

Proof of Identity Requirements

The regulations allowed each agency to set their own requirements for proof of identity. They were instructed, however, to allow for flexibility for survivors with different circumstances who may not have access to particular identification documents. Equifax’s requirements were the most cumbersome. In order to prove her identity on the telephone, Samantha had to submit a copy of her driver’s license, passport, signed social security card, a 1099, car insurance, and her W-2. In Samantha’s own words, “I am really established and I don’t see how a survivor in a safe house or in other situations would be able to provide the proof of identity documents they were asking for.”

Burden on Survivor

Above all, the biggest issue with the process so far has been that much of the burden for this process has been put on the survivor. Samantha has navigated this process without the assistance of a lawyer or case manager. Had she not pushed doggedly to make this happen, it simply would not have. As challenging as it has been, Samantha has the resources and determination to see this process through. However, the kinds of obstacles she has faced along the way may prove discouraging to many other survivors.

That said, it is important to add that the process can work, and work well. For example, the consumer reporting agency Innovis had a simple digital upload process in place within the first week that the law was enacted. Samantha submitted all the required documentation, Innovis processed her request in less than 24 hours, and they electronically sent her an updated credit report.

It’s not over by a long shot, but it is a start.

Now it’s time for all the consumer reporting agencies to improve this process by implementing easy to use online document submission systems, simplifying proof of identity requirements, ensuring documents are reaching the correct people, protecting confidentiality, abiding by the required timelines, and communicating with survivors in a timely manner to ease the burden on survivors.

*Please note, in order to protect survivors’ privacy, the name used is not real.

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The post Credit Reporting Agencies are Failing Human Trafficking Survivors first appeared on Polaris.

The post Polaris Letter of Support for the ENABLERS Act first appeared on Polaris.

Thanks to their hard work, the Debt Bondage Repair Act became law at the end of 2021. This new law created a process for survivors of trafficking to block certain damaging things from their credit reports that were a result of their being victimized. After the law was passed, it was up to the Consumer Financial Protection Bureau (CFPB) to make it workable. This meant creating a process for consumer reporting agencies to allow survivors of trafficking to block the information they want to block. This process went into effect on July 25, 2022 and it is workable. That said, it is not entirely easy and additional steps should make it more so in the foreseeable future. To date, here are some of the key takeaways about this process (this information can also be found in a fact sheet that we created):

• The federal government is not involved in the daily process. Instead, survivors will need to submit three types of required information directly to the private companies that manage credit reports. The largest of these “consumer reporting agencies” or “credit reporting companies,” are Experian, TransUnion, and Equifax. There are also specialty consumer reporting agencies that focus on specific areas such as employment screening, tenant screening, check and bank screening, and insurance. Click here for a list of these agencies. The required information to send to each of these individual agencies separately includes:
  • Proof of identity: Consumer reporting agencies will need identifying information to ensure they block information from the correct credit report.
    • Each consumer reporting agency sets their own requirements for proof of identity. Examples that are likely to satisfy the requirements may include: a copy of a driver’s license or another government-issued identification card; a copy of a utility bill, bank statement, or insurance statement.
  • Victim Determination Document(s): The law requires trafficking survivors to submit documentation that shows that a government entity (i.e. a law enforcement agency or a government-led human trafficking task force) or authorized non-governmental service provider has determined that they are a victim of trafficking. This is where the process may still get tricky.
    • Many relevant government entities do not currently issue this kind of documentation and will need to create a new process to do so.
    • Each government agency/task force is responsible for creating its own internal process and policies around authorizing non-governmental service providers and right now, most have not done so.
  • A list of specific information to be blocked from the report: Survivors will be able to self-identify what information on their consumer reports are the result of trafficking. This can include information related to things that occurred during their trafficking situation or after exiting their trafficking situation.
• Consumer reporting agencies must temporarily block the credit information within 4 days of receiving the survivor’s submission and must make a final determination about whether or not to permanently block the information within 25 days. The credit agencies can only deny requests in very limited circumstances if the information reported meets the requirements. More information is available in the fact sheet.
• Survivors will have the opportunity to appeal a consumer reporting agency’s denial and/or revise their submission if needed. Complaints about a specific consumer reporting agency’s implementation of this process can be made at https://www.consumerfinance.gov/complaint/.

While this process is not perfect and may be more challenging for some survivors than others, it is a key step in providing survivors with financial freedom and a path forward.

We have tried to provide answers to some of the common questions that are coming up and have recorded a discussion with a survivor and advocate who are navigating the process to share what is understood so far. However, this process is new and we expect it to continue to evolve over time. We will continue to provide updates as we learn more information.

The post The Credit Repair Process for Survivors: What We Know So Far first appeared on Polaris.

The post Credit Repair Process for Survivors of Human Trafficking first appeared on Polaris.

Now, thanks to Congress, Lana and others in similar positions have a pathway to financial freedom. The new rules, known as the Debt Bondage Repair Act, were included in a larger package of legislation enacted in late 2021. The rule creates a process through which survivors can provide information and have adverse credit information resulting from their trafficking experience removed from their credit report. It’s not perfect and there will still be some survivors who don’t have the evidence they need to move forward, but it is a major leap forward from where things stood before.

What happened to Lana is not unusual in trafficking situations. In 2018, Polaris conducted a survey and focus groups with survivors on their experience with financial institutions before, during, and after their trafficking situation. Of survey respondents, 26 percent reported that their trafficker used or controlled an account in their name and almost all of the focus group participants reported that traffickers kept their own names off of any financial records whatsoever.

Using the identity of their victims is not just a tactic to avoid identification, but to further entangle a victim under a trafficker’s financial control. The use of victim identities by traffickers can have a long lasting and devastating impact. Survivors report leaving their trafficking situation only to discover their credit score has been ruined by their traffickers. Some are left to pay debts their trafficker incurred in their name. Damaged credit histories make it difficult for survivors to find safe housing, get a credit card, and secure loans for things like education or starting their own business. Without stable credit, survivors are vulnerable to re-exploitation.

There is still a great deal of work to be done to ensure survivors of sex and labor trafficking have the tools and support they need to put themselves on solid financial footing and move forward their lives. But this legislation is a key step in that direction that will have a measurable impact on the lives of people who have struggled and fought their way to freedom and deserve the chance to get out from under the mess their traffickers have made of their credit scores.

*Please note, in order to protect survivors’ privacy, the name used is not real.

The post New Legislation Provides Survivors with a Path to Financial Freedom first appeared on Polaris.

Just as importantly, the anti trafficking field has even more concrete evidence that working directly with people with lived experience of trafficking is the single best way to understand the crime in context and reduce vulnerability and victimization.

Scaling up collaboration between trafficking survivors and financial institutions through the Polaris Financial Intelligence Unit, established in partnership with PayPal, could result in more traffickers being held accountable; fewer survivors of trafficking having to testify in order to see their traffickers prosecuted, and more nuanced and effective responses from the financial services industry.

Lundstrom’s records covered a period when she was trafficked by someone she was in a romantic relationship with – a situation often referred to as “Romeo” pimping – as well as a period when she was controlled by a “CEO pimp” – a trafficker type whose operations generally begin with fraudulent job offers that sound lucrative or glamorous.

While the financial institutions could clearly tell from the records that the account holder was in some kind of financial distress, without context, they would not be able to see the full picture of what could have been going on in Lundstrom’s life at the time.

For example, the bank records from her trafficking experiences cross-referenced with Lundstrom’s own journal during that time made it clear that she was earning – but not being allowed to keep – a great deal more money than was being deposited into her account.

The records from when she was romantically involved with her trafficker showed different patterns of money flows than when she experienced trafficking from the CEO pimp, who dispensed funds to Lundstrom in small increments as a means of control. In several instances, for example, the deposit made was for the exact amount necessary to cover certain bills with little leftover that would allow her the freedom to make her own choices.

Another useful pattern Lundstrom noted was whether or not hotel rooms appeared on the trafficked person’s bank records. For example in Las Vegas, hotel rooms are less likely to appear frequently on a trafficked person’s bank statements because sex buyers generally have paid for the rooms.

These context clues are key to helping banks understand the many complexities of trafficking situations and build more targeted and nuanced detection models.

The next step is scaling these efforts to bring together survivor expertise and anti-money laundering professionals and in doing so, expanding the ability of banks and the financial services industry to be part of the anti-trafficking solution.

The post Bringing Survivor Expertise to Anti-Money Laundering Professionals first appeared on Polaris.

That’s the fundamental premise behind the launch of Polaris’s Financial Intelligence Unit, a partnership with PayPal. The Financial Intelligence Unit will equip the one industry all traffickers try to misuse – financial services – with the tools to better understand how traffickers use banks, credit cards, payment processors and the like. This knowledge, shared throughout the industry, will help anti-money laundering professionals better spot likely trafficking activity, and generate more actionable leads for law enforcement. 

There are a number of victim-centered reasons why taking a financial crime approach to trafficking investigations is vital. One of the most significant difficulties in prosecuting trafficking cases has traditionally been their dependence on survivor testimony – an experience that can be terrifying and retraumatizing for many. Financial crime prosecutions do not require the same level of victim participation, relieving the intense pressure placed on survivor witnesses, and in some cases, eliminating it entirely. 

Financial investigations also differentiate in nuanced ways between traffickers and their victims, helping to ensure that the right people are prosecuted.  Even when money laundering or other financial crimes charges are not pursued, financial evidence helps identify assets for forfeiture and restitution to support the individuals harmed.

The anti-money laundering community has sophisticated systems and methods to monitor for various kinds of criminal activity in financial records – and is legally obligated to do so. But just because it is possible to detect trafficking through these transactions, doesn’t mean it is easy. The use of overly broad “red flags” can yield too many false positives, overwhelming investigators and negatively impacting vulnerable communities.  A nuanced understanding of the crime and how the associated financial patterns manifest is needed to ensure that anti-money laundering efforts are both effective and responsible. 

One of the keys is research. This is done in collaboration with the financial services industry and with key stakeholders – including survivor experts. We use data from the U.S. National Human Trafficking Hotline and other sources to study how traffickers operate on a number of fronts – from how new technologies are being misused by traffickers and professional money launderers to how sex and labor traffickers use their victims’ credit and bank accounts to hide their own profits and activities. 

Part of that collaborative effort will be documented and spread through STAT – the acronym for Stand Together Against Trafficking. This online platform will allow the anti-money laundering community to learn from one another, spot trends and understand how trafficking works – and changes – over time. 

This innovative work serves as a model for the ways corporate partners can step up to help fight trafficking in meaningful ways that go far beyond writing checks. PayPal is a true program partner in this effort, as are countless banks and other financial services institutions. 

The potential for impact is enormous. Financial services are used in virtually every trafficking operation. Working with the financial services industry to make trafficking a high-risk, low-profit business venture is the very definition of scalable, long-term change. 

The post Launch of the Polaris Financial Intelligence Unit first appeared on Polaris.

Through this initiative, these organizations, each with a long history and unique knowledge and expertise in combatting human trafficking, are teaming up to find new, innovative ways for the anti-money laundering community to recognize financial transactions that are red flags for human trafficking. 

“Financial institutions have long been powerful partners in the fight against human trafficking,” said Sara Crowe, director of Polaris’s Strategic Initiative on Financial Systems. “Thanks to our partnership with PayPal, anti-money laundering professionals will have more opportunity than ever to share information, identify new techniques to effectively zero-in on those who profit off of the exploitation of others, and provide actionable information to law enforcement.  In doing so, we help bring accountability to those who financially benefit from trafficking and restore freedom to countless thousands of people around the world.”   

The concept of the Financial Intelligence Unit grew out of the findings from Polaris’s seminal report, On-Ramps, Intersections, and Exit Routes, which examined the roles of major private and public-sector systems and industries on the sex and labor trafficking ecosystems. Based on the findings of this report, Polaris concluded that the financial services industry, particularly companies like PayPal with global technology and financial services expertise, were best positioned to help solve the problem of human trafficking by making it more difficult for traffickers to move money.

“PayPal and Polaris coming together is a great example of private and non-profit entities joining forces to achieve a positive social impact that neither party could fully realize on their own,” said Aaron Karczmer, Chief Risk Officer and EVP, Risk, Regulatory, and Protection Services of PayPal. “We look forward to advancing new, innovative approaches to combating human trafficking with partners like Polaris, who, like PayPal, strive to create meaningful change on this important issue.”

Leaders in the anti-human trafficking field applauded the announcement. “Human trafficking exists for one simple reason: Profit,” said Luis C. deBaca, who served as  Ambassador-at-Large to Monitor and Combat Trafficking in Persons and as Director of the U.S. Department of Justice’s Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking. “As a former prosecutor, I know all too well just how difficult it is to hold people and businesses accountable for modern slavery. Working with financial institutions to understand how traffickers use their services has the potential to dramatically shift the trafficking equation, making exploitation more risky and therefore less profitable. That’s the kind of systems-level work that will make it possible to end this crime once and for all.”

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People can be connected to help or report a tip of suspected human trafficking by calling the U.S. National Human Trafficking Hotline at 1-888-373-7888, texting “BeFree” (233733), or chatting at www.humantraffickinghotline.org.

About PayPal: PayPal has remained at the forefront of the digital payment revolution for more than 20 years. By leveraging technology to make financial services and commerce more convenient, affordable, and secure, the PayPal platform is empowering 300 million consumers and merchants in more than 200 markets to join and thrive in the global economy. For more information, visit paypal.com.

About Polaris: Polaris works to dismantle the systems that make sex and labor trafficking possible and profitable in North America. For more than a decade, Polaris has provides real-time response to victims and survivors through the U.S. National Human Trafficking Hotline and harnessing what we learn from that experience to help inform, design and implement scaleable, long-term, solutions that leverage the insight of survivors and hold all actors in the human trafficking ecosystem accountable. Learn more at www.polarisproject.org.

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