A legal claim on behalf of investors in the Woodford Equity Income fund has secured funding and the backing of the UK Individual Shareholders Society.
In an update over the weekend the consumer body - known as ShareSoc - said it was in the "best interests" of those who lost money in the Woodford saga to join a claim led by law firm Leigh Day, which is now accepting clients for a group claim against Link Fund Solutions Limited.
It came as the legal claim secured funding and claimant costs insurance agreements in a move it is hoped will help investors recover "significant losses".
The crux of the claim alleges that Link, as the fund’s authorised corporate director, failed to act when Mr Woodford invested in stocks inappropriate for the fund’s investors.
ShareSoc said it was confident Woodford investors would incur no costs and, if the claim was successful, they could get back "70 per cent of their losses".
Cliff Weight, director at ShareSoc, said: "We believe the pursuit of compensation in this case benefits all investors, as a successful outcome will lead to higher standards of behaviour in the future.
"This is the first time ShareSoc has ever endorsed a legal claim. We did this only after careful consideration of the many potential claims that have emerged.
"And we are enthused that the Leigh Day claim is now the first to be fully funded and has ensured potential costs to claimants are insured."
Leigh Day said it was now looking forward to progressing the litigation "in earnest".
Bozena Michalowska-Howells, head of consumer claims at Leigh Day, said: "In bringing this claim, we hope to provide recourse to the many thousands who suffered loss from investing in the fund. Especially, since so many invested from their pension pots."