Forms of aggression
1) The behavior of your wife's co-worker, though certainly a form of aggression, is often, mistakenly lumped in with what has become the default term at hand, 'passive aggressive'. I could have easily left it at that, it is doubtful that many would challenge this ascription. However, I feel that the term, as it applies in this case, overlooks the insidious nature of this predatory, personality. This behavior is a form of 'covert aggression'.
See the difference:
Covert aggression – when the aggressor attempts to conceal aggressive behavior and nefarious intent to increase the odds of gaining advantage over a target.
Passive aggression – when the aggressor fails to do, resists doing, or refuses to do something as a way of frustrating a target.
Why?
I loitered for a minute as I read the the question, after that, the consensual response, and then moved to the next question, nodding in agreement. Something irked me, possibly a note of frustration; a familiar encounter I once had; not sure, but it compelled me to return, and reconsider. Once I had realized my mistake, it shamed me a little.
The research on spontaneous inferences (Krull 1993, Krull & Dill 1996, Uleman 1987), employed a state machine to represent the analytical thought processes of aggressive personality types; motives, and the predictability of altering behavior (General Aggression Model). Also, super dry reading, save for the scant, salient points.
The Point?
The passive aggressive retreats, into a defensive posture. They are reactionary, motivated by perceived injustice, stemming from a low self esteem. They will attempt to sabotage, in order to frustrate their target.
The covert aggressive is a bully; intelligent and calculative, this is cognitive affect, and arousal, which drives the underlying appraisal and decision processes, with intent.
2)'Turning the other cheek', overtures of goodwill, and delicate affirmations, can, and often do, satisfy the justice demands of a passive aggressive.
However, be cautious with a covert aggressive. They will interpret these as exposed weaknesses, and exploit them in order to sate a narcissistic appetite.
Anderson, Craig A., Bushman, Brad J. Human Aggression, Department of Psychology, Iowa State University. Annu. Rev. Psychol. 2002. 53:27–51
Simon, George K. Dr. In Sheep's Clothing: Understanding and Dealing with Manipulative People. April 1, 2010
Best Answer
You can certainly use the verb to cheat in this context, but you want to avoid the phrasal verb to cheat on [a person], which specifically implies (generally sexual) infidelity within a romantic relationship.
The structure you're probably looking for is X cheated Y out of [his money].
I'm not sure what it would mean to cheat someone of their feelings. If you're confused about how to continue the sentence after the verb, you could always say something like: X cheated Y, causing him to lose a good deal of money.