The Financial Services Compensation Scheme is suing collapsed advice firms Bates Investment Services and Clarkson Hill Group for a total of almost £1.6m.
According to High Court papers seen by Money Marketing, the FSCS has brought claims against both firms for negligence and breaching contracts in relation to giving advice and arranging investments.
Bates advised 20 investors in relation to the FSCS case, and Clarkson Hill advised a further 20 investors.
The FSCS is not looking to recoup the total it has paid out.
Of the 20 Bates clients, the FSCS received 19 claims, totalling £832,033.74. Of this total, the FSCS is pursuing £811,200.49.
For Clarkson Hill, six claims are mentioned in the court papers worth £780,449.79, and the FSCS is claiming the full amount. The FSCS is pursuing £1,591,650.28 in total.
The FSCS papers say the legal action concerns the two firms, their employees or agents being “negligent, in breach of contract … and/or made negligent misstatements”.
EY are the liquidators for Bates, while Harrisons Business Recovery is winding up Clarkson Hill.
The claims were lodged in the High Court last November.
Law firm Ingram Winter Green is acting for the FSCS, while DAC Beachcroft is representing both advice firms. Both declined to comment.
An FSCS spokesman says: “FSCS pursues recoveries when it is cost effect to do so. We do not speculate on this or any other possible future recoveries actions.”