Lloyds Banking Group is defending two High Court claims, one worth up to £1.1 billion and another for £280 million, brought by insolvency practitioners over an alleged £1.2 billion lending fraud at Arena Television, with a trial scheduled for October 2028.

The bank denies allegations that it had enough information to know it should not have processed payments related to the alleged fraud.

Arena, which was based in Surrey and worked on events including the Glastonbury festival for the BBC, collapsed in November 2021 amid allegations that it had been borrowing against television equipment that did not exist or was already pledged to other lenders.

According to Arena’s liquidators, from Kroll, Richard Yeowart, Arena’s owner, “misappropriated proceeds of asset-backed lending in excess of £1.2 billion with over 55 different lenders”, including Bank of Scotland and Lloyds.

The liquidators have alleged that Yeowart removed genuine serial numbers from broadcasting equipment and replaced them with forged labels. Falsified numbers were then allegedly presented to asset-based lenders, allowing Arena to secure multiple loans on the same piece of equipment.

They also alleged that Yeowart and his co-director, Robert Hopkinson, presented a company called Sentinel as the buyer of equipment so that Sentinel could raise funds against the supposed assets. The funding was passed to Arena, minus a commission of around 1 per cent.

According to Sentinel’s administrators, from Quantuma, Sentinel “sold” non-existent equipment to lenders, which leased the fictitious equipment to Arena. Sentinel paid roughly £1.1 billion to Arena from funds it raised from lenders. Of 8,196 purported pieces of equipment, only 66 actually existed, insolvency practitioners alleged.

The Serious Fraud Office announced an investigation into the affair in 2022. Yeowart, whose whereabouts are unknown, has been made bankrupt. Hopkinson, found in France in 2023, has also been bankrupted and his whereabouts are unknown.

Sentinel’s administrators argue that the bank was on notice because of the pattern of thousands of transactions and that it should have stopped the payments from at least 2012. They add that “it ought to have been apparent to Lloyds” that the payments “indicated or involved wrongdoing”.

Sentinel is asking Lloyds to “reconstitute” its bank account with £1.1 billion, or alternatively £945 million, the sum Sentinel paid to Arena from May 2012, when it is claimed the bank had “reasonable grounds for believing” the payments were not legitimate.

Arena’s liquidators have alleged that Lloyds and its Bank of Scotland subsidiary processed payments “without authority”. They claimed there were “a number of facts and matters which would have caused a reasonably skilful and careful banker” to question whether transactions were “truly authorised”.

The allegations are that Lloyds breached its “Quincecare” duty, which requires a bank to exercise reasonable care and refrain from executing a customer’s payment instructions if there are grounds to suspect the instruction is an attempt by an agent of the company, such as a director, to defraud the bank’s customer. Other banks, including Royal Bank of Scotland, are also defending Quincecare claims.

The cases are being closely watched by the banking industry because, if the claimants succeed, the litigation may force a rethink on how banks handle suspicious payment instructions and the extent of banks’ duties when corporate customers are defrauded.

Nick Oliver, director of the law firm Isadore Goldman, which is working on the Sentinel claim, said: “The question at the heart of this case is whether Lloyds Bank should have spotted the warning signs, as more than a billion pounds of funds were channelled through one of its accounts.

“Allowing this case to proceed to full trial is a significant step, and will be an important test of UK banking laws.”

Lloyds attempted to have the Arena claims dismissed, but in November 2025 Mr Justice Butcher refused the bank’s application for summary judgment.

In its half-year results in July, published alongside the bank’s Accelerate 2030 strategy, Lloyds acknowledged the claims, saying it was “continuing to defend” them. “It is not practicable to estimate the final outcome of the matter or its financial impact (if any) to the group,” it said.

A spokeswoman for Lloyds said: “We are continuing to robustly defend the claims. We believe the claims wrongly seek to hold Lloyds liable for the financial consequences of a complex alleged fraud perpetrated against more than 50 lenders, including Lloyds.”