The Creditors of Independent Insurance Group (CIIG) is £1m short of the total needed for its action against Independent Insurance's directors and its auditors, KPMG.
Chairman Kevin Young told Insurance Times there was “enough compelling evidence” to take the case to a feasibility study, but stressed more money was needed to take the “action to its overall conclusion”.
The group will have a decision from Queen's Counsel by the second week of September as to whether it has a case.
He said the CIIG needed £1m to take one or two defendants to court.
“It's time some people made the decision whether to stand up and be counted,” Young said.
“There is an injustice to the creditors who are in and paid up while others pledge support, but wait to see what happens on other people's money.”
The group has raised enough funds to begin a feasibility study, but needs more cash pledges if it is to take the action through the courts.
Class Law partner Stephen Alexander said: “Fence-sitting, which is a popular British pastime, will not get people compensation.”
“People who have lost money must now take action or they will not recover their losses and, for many companies, their shareholders will also suffer losses if they don't do anything,” he said.
Class Law said in the past few weeks the group had gathered enough evidence to put forward a case against four major defendants.
The group's main target will be Independent's auditors, KPMG; then its actuaries Watson Wyatt, the Financial Services Authority (FSA) and lastly the directors of the company.
“We feel we have enough evidence to put in front of counsel to settle proceedings,” said Alexander.
So far, Class Law has spent between £50,000 to £75,000 on the action.