Aug. 13, 2004 -- Evergreen Investment Management Company identified the two funds -- Evergreen Mid Cap Growth Fund (EKAAX) and Evergreen Precious Metals Fund (EKWAX) -- that were implicated in a mutual fund trading scandal.
In a letter to shareholders, Evergreen's President and Chief Executive Officer, Dennis H. Ferro, wrote that from December 2000 through April 2003, one of Evergreen's affiliated broker-dealers, apparently under authorization of an Evergreen officer, engaged in short-term trading on behalf of a client in the Mid Cap Growth Fund in excess of the limitations set forth in its prospectus.
Also, from September 2001 through January 2003, it is believed that the former portfolio manager of the Precious Metals Fund engaged in short-term trading in that fund. That portfolio manager is no longer with the firm.
Ferro said Evergreen reimbursed these funds for the amounts representing the net gains and expenses involved in the trading activity. For the Precious Metals Fund this amounted to $73,953, and for the Mid Cap Growth Fund it amounted to $404,147.
As reported on August 3, the SEC announced that it would seek to bring an enforcement action against Evergreen for improper trading.
Evergreen is a unit of Wachovia Corp (WB).
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