FACTS
In this case, heard before the High Court of England and Wales,
the claimant alleged that, in and prior to September 2005, he had
been wrongly advised by the defendant bank to invest £1.25
million into a fund known as the Enhanced Variable Rate Fund
(EVRF), part of an investment product known as the
Premier Access Bond (PAB). The PAB was issued by
AIG Life, which was part of a wholly-owned subsidiary of the
American International Group (AIG).
The claimant's investment in the EVRF continued until
September 2008. This was the time when the financial position of
Lehman Brothers (which had earlier in the year reported huge losses
arising from the United States subprime mortgage market crisis),
became untenable and clients and shareholders of Lehman Brothers
withdrew their money. Other major financial institutions in the
United States were coming under similar pressure, including AIG. As
stated by The Honourable Mr Justice Jonathan Parker :
