You might have been affected by a financial institution selling you an unsuitable product. You might feel they were negligent and want to seek legal restitution – knowing how to sue a bank is important and stops it from feeling like an intimidating and risky task.

To start off with, if you have just lost a significant amount of money or even gone bankrupt as a result of a banking deal, the last thing you want to do is hire an expensive lawyer that you have to pay by the hour – especially as banking litigation court cases can become drawn out affairs which lead to exorbitant legal fees.

Here’s how to sue a bank for negligence without putting yourself at unnecessary risk:How to sue a bank

How to sue a bank step 1: Partner with a third-party funder

If you make use of a third party funder you can avoid the financial risks related to your lawsuit. The funder will pay for everything related to the court case, in return for a percentage of the damages if your case is successful.

However, should your case fail, the funder bears all the costs and you pay nothing. The funder usually takes on 100 per cent of the risk for between 10 and 30 per cent of the damages awarded.

How to sue a bank step 2: Draw up a conditional fee agreement

A conditional fee agreement, or CFA, transfers the risks of litigation from the client to the lawyers. Clients avoid the significant costs commonly associated with fixed fee or hourly rate agreements, with the solicitor being paid upon the cases’ successful conclusion instead.

How to sue a bank step 3: Consider ATE insurance

Unlike home, car and travel insurance which you take out before the event, hoping you won’t need it, 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 reward to pay the cost of the insurance premium.

The use of third party litigation funding, CFAs and ATE insurance can sound complicated, but they are simply risk management tools and used correctly they can make all the difference to a banking litigation case.

The idea that banks cannot be held accountable is a misconception; when they are faced with a well organised, presented and funded case, they can be brought to justice.

When considering how to sue a bank, don’t be dissuaded simply because your opponent has superior resources – their position is often a lot weaker than it initially appears. Get proper advice on how to bring your claim and give yourself the best possible chance of success.

Annecto Legal has access to a network of legal specialists, and considerable experience of funding claims against banks. For more information on how to sue a bank, visit our banking litigation page, or contact one of our financial services litigation advisors.