Cases of complex fraud present significant hurdles in criminal offence proceedings. Fraud inherently operates in secrecy and deception, increasing the difficulty of substantiating a claim. Moreover, there is always the risk that a fraudster will dissipate assets. However, some businesses or individuals may lack the financial means required for this process, potentially causing difficulties.

Given that complex fraud can incur substantial expenses, it is vital to be well-informed about funding options to guarantee a cost-effective approach to fraud claims. At Annecto Legal, we  recently assisted an insolvency practitioner in securing litigation funding for a complex fraud and professional negligence case valued at over £11m.

How Annecto Legal assisted on a complex fraud case

An insolvency practitioner recently approached Annecto Legal in relation to a possible fraud or professional fraud action. This client was extremely limited in terms of funds available to them in administration. Therefore, it was essential to secure litigation funding for their case as soon as possible.

However, it was still early in the process, and it was not yet clear which cases would be pursued or whether the defendants had the assets available to either settle the claims or satisfy any judgement made against them.

Annecto Legal was able to ensure that expenditure was kept to a minimum and targeted specifically to exactly what funders would require in order to make an investment and fund the claim.

We were also able to suggest investigators who would be able to work on a contingency fee basis. This then allowed the asset position to be clarified for no additional expenses.

The case has now secured funding and insurance, with the combined costs of both cases totalling between 10% and 20%, which was significantly lower than the insolvency practitioner’s expectations.

Funding complex fraud litigation

If you are pursuing complex fraud litigation, legal costs can escalate quickly. Therefore, it is crucial that you are aware of the funding options that are available to you. Funding this type of case can be intricate and will often depend on the circumstances of the case. Listed below are some of the options for funding fraud litigation.

• Conditional fee agreements– Conditional fee agreements (CFAs), also known as ‘no win, no fee agreements’, are a type of funding arrangement that allows individuals to pursue litigation without paying legal fees upfront. Under a no win no fee basis, the law firm agrees to take on the case and only charges a fee if the case is successful. If the case is unsuccessful, the client does not have to pay these legal fees. 
• Contingency fee agreement – Some fraud litigation solicitors may offer to take on a case on a contingency fee basis. This means that they will only charge a fee if they are successful in securing a financial settlement or damages. The fee payable to the solicitor is usually a percentage of the amount recovered. If the case is unsuccessful, the law firm will not charge a fee.
• After the event insurance – After the event (ATE) insurance is a type of insurance that can provide cover for legal costs in the event that a case is unsuccessful. This option can be particularly useful in cases where the outcome is uncertain, and the costs of losing a case could be significant. ATE insurance is often used in conjunction with conditional fee agreements.
• Third party litigation funding– In some cases, third party litigation funders may be willing to provide funding for a case in exchange for a percentage of any financial settlement or damages awarded. This option can be attractive for individuals who cannot afford to pay for legal fees themselves but have a strong case.

How can Annecto Legal assist?

At Annecto Legal, our professional advisors assist clients in finding the right legal guidance and funding for complex fraud cases. Having specialist fraud solicitors and being fully funded gives you that strength and forces your opponent to the negotiating table.

If you wish to speak to an advisor about making and funding a complex fraud case, please contact us today. We can help find you the right representation, as well as managing your financial risks and sourcing funding for your legal fees.

Unfortunately, because of the high costs of legal actions in the UK, we only assist in disputes in which the financial value of the claim is over £250,000, at the absolute minimum. We would like to be able to help on other claims, but we just don’t have access to any products that can assist on smaller matters.