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Professional negligence claims against financial advisors

Financial advisors play a crucial role in helping individuals and businesses make informed decisions about their financial matters. Clients trust their financial advisors to act with expertise, diligence, and utmost care in providing sound advice and recommendations.

However, there are instances when these advisors fail to meet the required duty of care, leading to significant financial losses for their clients. In such situations, clients may have the option to pursue a legal remedy through professional negligence claims.

At Annecto Legal, we connect clients with the right professional negligence solicitors, as well as securing litigation funding for your case. Our service is designed to ensure that any business or individual that has suffered a financial loss as a result of professional negligence has the best possible opportunity to find redress.

Unfortunately, due to the high costs of legal actions in the UK, we only assist in disputes which are valued at over £250,000, at the absolute minimum. We would like to be able to help on other claims, but we simply do not have access to any products that can assist on smaller matters.

What is professional negligence by a financial advisor?

Professional negligence by a financial advisor, also known as financial advisor malpractice, occurs when a financial advisor fails to meet the expected standard of care and competence in providing services to their clients, resulting in financial harm or losses to the client. This failure can be due to actions, omissions, or financial mis-selling by the advisor during the course of their professional relationship with the client.

Examples of professional negligence by a financial advisor may include:

  • Providing incorrect or misleading financial advice that leads to substantial losses for the client.
  • Failing to disclose potential risks associated with investments or financial products.
  • Engaging in fraudulent activities, such as misappropriating client funds or unauthorised trading.
  • Failing to monitor or manage a client’s investments appropriately.
  • Violating regulatory or ethical standards in the financial industry.

The Pre-Action Protocol for professional negligence claims encourages early communication and the resolution of disputes before formal proceedings are initiated. If a client believes they have been a victim of professional negligence by a financial advisor, it is crucial to seek expert legal advice promptly to assess the viability of a claim and explore potential remedies.

Time limits for professional negligence claims against financial advisors

The general limitation period for professional negligence claims in the UK is six years from the date the cause of action arose. In the context of financial advisors, this typically means from the date the alleged negligent act or omission occurred.

If the financial advisor’s negligence involved fraud or deliberate concealment, the limitation period may be extended. In such cases, the claimant may have six years from the date they discovered (or should have discovered) the fraud or concealment to bring a claim.

It is essential to note that time limits for professional negligence claims can be complex and vary based on the specific circumstances of each case. Therefore, it is crucial to consult with a qualified legal professional for the most current and accurate advice regarding time limits for professional negligence claims against financial advisors in the UK.

Funding professional negligence claims against financial advisors

If you are pursuing a professional negligence case, legal costs can escalate quickly. Therefore, it is essential that you are aware of the funding options that are available to you. Funding a professional negligence claim against a financial advisor can be a complex process and will depend on the individual circumstances of the case. Listed below are some of the options for funding a professional negligence case.

  • 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 a claim 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 professional negligence solicitors may offer to take on a professional negligence case on a contingency fee basis, which 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, and 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 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 professional negligence case in exchange for a share of any financial settlement or damages awarded. This option can be attractive for individual who cannot afford to pay for legal fees themselves but have a strong case.

How can Annecto Legal assist?

At Annecto Legal, we assist claimants in finding solicitors who specialise in professional negligence claims against financial advisers. We can also help you find funding for pursuing a professional negligence case.

With the right legal team, it is possible to put in place the appropriate litigation funding and insurance to take the case through court proceedings, if necessary. Of course, the preference is always to find a suitable settlement in a reasonable time frame, but the best way to achieve this is to negotiate from a position of strength. Having the best professional negligence lawyers and being fully funded gives you that strength and forces your opponent to the negotiating table.

Annecto Legal helps clients realise the value of their professional negligence cases. We work closely with litigation funders, insurers and professional negligence solicitors that seek alternatives to the traditional hourly rate funding model.

If you are in the process of suing a financial advisor or believe your financial adviser has been negligent and want to find out whether you’ve got a claim, please contact Annecto Legal today. We can help find you the right representation, as well as managing your financial risks and sourcing funding for your legal fees.

Get in touch

* Annecto Legal can only assist on case where the loss is in excess of £100,000, with the exception of data breach claims. If you need assistance on a claim worth over £100,000, please get in touch using our form or the details below:

Registered Office

Annecto Legal Ltd, 106 Kennedy Building, Murray Street, Manchester , M4 6HS


0800 612 6587


Contact us directly