Investment Fraud Lawyer Blog

Evergreen Investment Management Company (“Evergreen”), a unit of Wells Fargo & Co., has agreed to pay more than $40 million to settle an enforcement action by the Securities and Exchange Commission (“SEC”) and the Massachusetts Securities Division, according to articles in the Wall Street Journal and Reuters. Evergreen was a subsidiary of Wachovia at the time of the violation, according to Reuters.

Continue reading "Evergreen Pays Over $40 Million to Settle SEC Charges that it Overvalued Mortgage-Backed Investments" »

Wachovia Corp.’s subprime and credit crisis woes appear to be increasing at a rapid rate. Yesterday, the U.S. bank reported a record quarterly loss of $8.9 billion. The loss reflects, among other things, Wachovia’s ill-advised acquisition of Golden West Financial Corp. in 2006. Bloomberg News has reported that the second quarter loss marks the first time, in at least 20 years, that Wachovia has experienced two consecutive quarterly losses. Wachovia’s stock has lost 65% of its value so far this year.

In response to these developments, Wachovia hopes to dispose of certain parts of its business. Last week, reports suggested that the bank might even be willing to part with Wachovia Securities. In addition, Wachovia hopes to pare expenses by $2 billion, has drastically cut its dividend and has announced plans to cut some 6,000 workers. The company also stated its intent not to fill approximately 4,400 positions that are currently open.

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On June 19, Evergreen Investments, a subsidiary of Wachovia Corporation, announced that it was liquidating the Evergreen Ultra Short Opportunities Fund (EUBAX). The Fund has lost 19.6 percent of its value year to date, including total realized losses of more than $200 million in less than three months since March 31, 2008. Bond funds – traditionally considered safe, conservative investments – have once again proven that they are not immune to the subprime meltdown and may be among the most exposed investments of all.

The Fund, whose objective was to provide current income with preservation of capital and low principal fluctuation, invested 83.25% of its assets in commercial and residential fixed and variable rate mortgage backed securities, including collateralized mortgage obligations.

Continue reading "Investors Lose Big As Wachovia Subsidary Liquidates Evergreen Ultra Short Opportunities Fund" »