Creditors of Independent Insurance Group (CIIG) are considering the possibility of pursuing the FSA through the US courts as well as through the European Commission (EC).
A meeting of creditors last Tuesday voted to submit two complaints about the FSA to the EC at the end of this week.
Creditors are complaining that the FSA did not comply with the articles in the first council directives, by failing to ensure that Independent had proper accounting systems in place, and that it failed to deal with specific warnings about Independent from the French regulator in 2001.
CIIG chairman Kevin Young said that the European action was attractive as Lloyd's had met with a positive response in its pursuit of the government through the EC and because "it's not costly for each individual creditor and it also means that there can be no costs awarded against creditors".
Young, who also announced his intention to step down as chairman of the group at the meeting, said that future action in the US courts may be taken based in fresh evidence against the FSA.
The complaints will cover all policyholders since 1994 and new creditors can join the class action.