Regulations, such as the Payment Services Regulations, are in place to protect customers when banks act negligently or fraudulently. Those who have been affected as a result of negligent or substandard service, which resulted in financial loss, could be entitled to compensation.

At Annecto Legal, we recognise that suing a bank can be overwhelming. We are committed to helping you access the legal support you need, including funding options and connections to expert solicitors who specialise in professional negligence claims.

How to sue a bank for negligence or fraud: The claims process

If you believe you have a valid claim against your bank, it is crucial to act promptly. Banks and building societies are required by law to have a written complaints process which tells customers how to make a complaint. You should be able to find details in banks and building society branches or on their website.

The next step is to make a submission to the Financial Ombudsman Service (FOS). The FOS is an independent body established by the government to handle complaints against banks and other financial institutions. This service provides an impartial and cost-effective way to resolve disputes without the need for court action.

The FOS follows an inquisitorial approach, meaning it actively investigates complaints by gathering information from both parties before making a decision. To strengthen your case, it is essential to submit a well-prepared and detailed complaint, supported by relevant documentation and evidence. Seeking advice from a specialist legal adviser before submitting your claim can help to ensure accuracy, increasing the chances of a favourable outcome.

Before litigation, it is often recommended to consider alternative dispute resolution methods, such as mediation or arbitration, to resolve the dispute outside of court. This can be a faster and less expensive option than going to trial.

If you are dissatisfied with the FOS’s decision or prefer to take a more direct legal route, you may initiate court proceedings against the bank. Unlike the FOS process, court cases are adversarial, meaning both parties present their arguments before a judge, who will determine the outcome based on the evidence. The general time limit for banking negligence and fraud claims is within six years of the incident.

Given the complexity of financial disputes and the legal requirements involved, obtaining expert legal advice is highly recommended. It is also important to be aware of the costs and risks of pursuing litigation throught the courts, and it may only be wise to do so in instances where significant financial loss has been caused by the bank. A professional negligence solicitor can assess the strength of your case, guide you through the legal process, and help you take legal action against a bank.

Litigation funding for banking negligence and fraud claims

If you are thinking about how to sue a bank for negligence or fraud, it is essential to explore all available options. Various litigation funding methods can help to reduce financial risk when pursuing a claim. It is important to assess the suitability and accessibility of alternative funding solutions to ensure the most effective approach for your case.

Third party funding

One funding method that is commonly used for professional negligence claims is third party funding. Third party funding acts as a form of non recourse financing for litigation. Third party litigation providers take on the financial risk of litigation so that clients can pursue a claim without having to worry about the legal fees associated with it.

In return for taking the risk, the litigation funder will typically seek a share of the proceeds in the region of a fifth to a third of any damages recovered. This means that you keep up to 80% of the award whilst have taken none of the risk. If the claim is unsuccessful, the funder will lose their investment.

Damages based agreement

A damages based agreement (DBA), also known as a contingency fee agreement, is a type of arrangement made between a client and a solicitor in which the solicitor agrees to fund their case and share the risk of litigation. In return, the solicitor will be paid a percentage sum of the damages recovered as long as the client’s case is successful.

DBAs provide that, instead of being paid on a conventional hourly rate, the solicitor’s legal fees are only payable in the event that the case is successful. Therefore, these types of arrangements allow clients the opportunity to pursue a case without having to worry about the solicitors’ fees associated with it. In some circumstances, however, fees for counsel and other disbursements may still be payable by the client.

ATE insurance

After the event (ATE) legal expenses insurance is taken out after the event that has led to a dispute has taken place to protect you in the case of your claim being unsuccessful. ATE insurance can protect you from paying for experts and barristers, as well as your opponent’s legal costs, should your claim not be successful.

However, ATE insurance is not free, and it is important to remember that if your case is successful, you may have to use some of your award to pay the cost of the insurance premium, which will be included in the terms and conditions.

Litigation funding methods may seem complex, but they are simply risk management tools designed to support claimants in banking litigation. When used effectively, these funding options can significantly strengthen a case. The notion that banks cannot be held accountable is a misconception – when presented with a well-prepared, properly funded, and strategically managed claim, banks can be successfully challenged and brought to justice.

Who can Annecto Legal assist?

Annecto Legal regularly helps customers and business clients of banks get the legal funding they need for negligence disputes in cases where there is a loss in excess of £100,000. We regularly assist with banking disputes involving: 

• Failure to refund unauthorised transactions
• Mis-selling of financial products
• Breach of duty
• Insurance
• Investments
• Deceptive fees and charges
• Wrongful repossession
• Will and trusts
• Tax advice

How can Annecto Legal assist?

When considering how to sue a bank for negligence or fraud, do not be dissuaded simply because your opponent has superior resources. Seeking expert legal advice can help you build a strong case and maximise your chances of success.

At Annecto Legal, we have extensive experience in funding claims against banks and access to a network of legal specialists. Annecto Legal do not handle the legal claim: We pass your enquiry onto a firm of solicitors who can assist and provide advice on how to sue a bank for negligence or fraud. If you have already done this then we can assist with funding and insurance for your case.

Annecto Legal are authorised and regulated by the Financial Conduct Authority. We are not a firm of solicitors nor a claims management company. We do not receive payments for passing enquiries onto firms of solicitors.

The firms we may pass you onto are independent firms and not linked with Annecto Legal in any way. If you proceed to make a claim, we can assist by providing funding or legal expenses insurance for your case if you have lost more than £100,000 due to banking fraud or negligence.