A Q&A with Jerry Yanover, Head of Risk at Fenchurch Legal
Meet Jerry Yanover, Head of Risk at Fenchurch Legal. In this Q&A, he shares insights from his 30+ years of experience about his role, risk management strategies, and navigating the evolving world of litigation funding.
How did you transition from law enforcement to litigation funding?
My journey into litigation funding began with consulting roles for various litigation funders, where I conducted due diligence on claimants and recipients. My background in the police and subsequently managing an intelligence company equipped me with the skills to uncover critical information in order to mitigate risks effectively.
What are your core responsibilities as Head of Risk at Fenchurch Legal?
My responsibilities primarily include conducting thorough background checks and due diligence on prospective borrowers as well as performing continuous monitoring on all Fenchurch’s’ existing law firms.
The due diligence process involves comprehensive background reports, understanding the operational set-up of each business, identifying any red flags, and ensuring financial suitability.
As a member of the Board, I am involved in executive decisions of the business, as well as identifying and meeting with potential investors to aid the growth of the company.
What are some emerging risks in litigation funding, and how do you address them during the due diligence process?
The biggest risks are borrower complacency and inadequate upfront and ongoing monitoring. Additionally, fraud from law firms is a significant concern for small-ticket litigation funders.
We address these risks at Fenchurch Legal by continuously assessing law firms to identify early signs of any issues. This involves conducting physical visits, maintaining regular communication, closely monitoring case progress, and reviewing financials to ensure timely and efficient case handling.
What strategies is Fenchurch Legal implementing to stay ahead of risk in the evolving litigation funding landscape?
We outsource two vital parts of the initial due diligence to third-party specialists who do background checks and risk assessment as well as compliance and regulatory checks. In addition to this, we conduct regular monitoring to assess any significant changes, both internally and by external third parties.
Some of these are conducted on-site, to ensure the accuracy of information, and others by remote accessing a borrower’s systems directly, and analysing information received. This approach helps us stay ahead of potential risks.
How is technology being leveraged to improve risk assessment and decision-making in litigation funding?
We are seeing emerging technologies that can analyse vast amounts of historical case data, AI systems can identify patterns and factors that influence case outcomes. These systems can predict the potential risks and rewards associated with funding a particular lawsuit, providing invaluable insights to litigation funders.
Fenchurch has its own loan management system which has in built risk checks to ensure we are alerted to any red flags. This approach helps us stay ahead of potential risks.
In your experience with both large and small litigation funders, how do risk profiles and risk management approaches typically differ?
Larger funders, especially those involved in single-case funding or large class actions, often rely more on the prospects of the case and the After the Event (ATE) insurance and less on ongoing due diligence of cases and the overall firm . In contrast, small-ticket litigation firms are more risk-averse and thorough in their approach to lending.
Could you share your vision for Fenchurch Legal’s future growth and expansion plans?
Fenchurch’s growth strategy is to expand organically, ensuring that our team grows in tandem. We are committed to continuing to deliver outstanding results to our investors, big and small and provide them with regular updates and returns.
We continuously monitor the market to onboard the best consumer law firms and stay updated with ongoing case law to choose the most robust and risk-averse case types for our clients.
Lastly, for investors considering small ticket litigation funding, what indicators should they look for to ensure that a litigation funder, such as Fenchurch Legal, has robust risk management strategies in place?
Risk management is pivotal, and investors should seek funders with strong risk management strategies, including comprehensive due diligence, case assessment, and ongoing risk management. This should also include an assessment of how the funder mitigates risks associated with smaller claims and adapts to changing circumstances.
At Fenchurch Legal, our focus on small-ticket litigation funding is underpinned by these risk principles, offering investors diversification, lower risk profiles, and access to a broader market with lower entry points.
For more information on our funding solutions or litigation funding investment opportunities, please contact us.
