AVZ RESPONDS TO CIVIL CHARGES

RNS Number:7905S
Amvescap PLC
03 December 2003

AMVESCAP PLC


IMMEDIATE RELEASE  3 DECEMBER  2003

CONTACT: MICHAEL PERMAN  TEL: [phone]




For Immediate Release

Contact:   Doug Kidd
Phone:     [phone]
Email:     [e-mail]





                    AMVESCAP Responds to Civil Charges


London, December 3 , 2003--- AMVESCAP PLC is the parent company of INVESCO Funds
Group (IFG), a Denver-based manager of retail mutual funds. Today, IFG was
informed by the United States Securities and Exchange Commission (SEC) and the
Office of the New York State Attorney General that it and an employee are facing
civil enforcement actions based on "market timing" activities by certain
investors in its mutual funds.  We believe these actions are not merited.
Neither IFG nor the employee who has been charged engaged in wrongful conduct.
These charges will be vigorously contested.

The phenomenon of active trading, which includes market timing in the mutual
fund industry,  is neither new nor newly discovered.  In fact, daily liquidity
is a fundamental feature of any open-end mutual fund, and absent clear
regulatory guidance, should not be needlessly restricted.  IFG tried in good
faith to identify and  curb harmful market timing activities.

In this highly regulated industry, no clear regulations or directions have been
provided that bear specifically on which market timing activities should be
permissible and which should not, nor what approaches a fund complex can or
cannot take in trying to cope with market timers consistent with the best
interests of its shareholders.  Unlike late trading - which is clearly illegal
and which IFG never knowingly facilitated or permitted - market timing is a
lawful activity.

IFG chose what it believed was the best approach in dealing with the problem of
potentially harmful market timing.  Industry-wide guidance is certainly in
order, and we welcome SEC Chairman Donaldson's pledge that new rules designed to
curb market timing abuses are forthcoming.  Comprehensive rulemaking, rather
than selected civil  enforcement actions, is the only fair way to establish new
industry responsibilities and legal duties in this important area of shareholder
protection.

Asset allocation strategies and similar investment techniques, which can include
market timing, have been a very complicated issue for the mutual fund industry
to manage for some time.  IFG, like many fund companies, recognized the
challenge of supporting the legitimate investment styles of asset allocation and
momentum investing while preventing short-term trading where it could be
harmful.  The collective judgment of IFG's management was that Fund
shareholders' best interests were served by trying to monitor all investors
utilizing investment models calling for frequent asset allocation or similar
legitimate changes, rather than remaining vulnerable to uncontrolled short-term
traders who would go in and out of the funds when they chose, in dollar amounts
they chose, and at a frequency and velocity they chose, all with the potential
harm that such uncontrolled trading could cause.

To accomplish this, IFG determined it could better control certain asset
allocators and momentum investors by restricting them to certain funds which, in
its judgment, would not be adversely affected by their activities.  This was
done after consultation with investment professionals and included restrictions
and limitations designed to protect the Funds and their shareholders.  These
restrictions and limitations were adjusted whenever IFG thought it necessary to
protect the Funds and their shareholders in light of changing market conditions,
investment strategies, or the portfolio manager's reassessment of what could be
appropriately handled.  In applying these standards, there was never a
requirement that any investor maintain other investments in exchange for trading
capacity.

IFG never put its financial interest ahead of the best interests of the Funds'
shareholders.  This is most clearly demonstrated by IFG's action in terminating
relationships with shareholders who held well in excess of $500 million of
assets that posed a potential threat to the Funds, and in turning away at the
outset investors seeking to invest in excess of that amount. Through our
internal review of this issue to date, we have documented approximately 400
separate instances where IFG shut down a shareholder's account because of its
timing activities.

IFG used a wide variety of tools to protect shareholders from the potentially
harmful effects of market timing.  Redemption fees were imposed on certain funds
that were potentially subject to "time zone," "illiquidity" or other "pricing
inefficiency" arbitrage plays. IFG actively searched for, monitored, and where
appropriate, terminated relationships with harmful market timers. This challenge
was made more difficult by marketplace features such as omnibus accounts and
similar arrangements that allow investors trading through intermediaries to mask
both their identity and their intent.

IFG's prospectus expressly authorized each shareholder to make four exchanges
per Fund per year without any limitation on the dollar amount of each such
exchange.  The prospectus specifically provided IFG with flexibility in its
exchange policy by expressly authorizing "modification" of that policy whenever
it was "in the best interests of the Fund."  IFG exercised that authority when
it deemed appropriate - sometimes to allow fewer than four exchanges in a
particular Fund that seemed vulnerable to the potential adverse consequences of
market timing activities, and sometimes, to allow more. Exchanges subject to the
restrictions and limitations described above were designed to protect the Funds
and their shareholders. Despite this record, the charges appear to treat what
IFG always intended to be a flexible guideline as if it were an inflexible
policy.

IFG saw uncontrolled market timers as a problem to be addressed in the interests
of the shareholders in order to avoid the potentially harmful aspects of
uncontrolled market timing activities in the funds.  In making these decisions,
IFG and its employees always acted in good faith and in compliance with its
prospectuses, its legal obligations, and most importantly, its fiduciary duty to
Fund shareholders.  Today's allegations are without merit and will be vigorously
contested.

ABOUT AMVESCAP:

AMVESCAP PLC is a leading independent global investment manager, dedicated to
helping people worldwide build their financial security.  Operating under the
Atlantic Trust, AIM, and INVESCO brands, AMVESCAP strives to deliver outstanding
investment performance and service through a comprehensive array of retail and
institutional products for clients in more than 100 countries.  AMVESCAP had
$345 billion in assets under management as of September 30, 2003.  The company
is listed on the London, New York, Paris, and Toronto stock exchanges with the
symbol 'AVZ'.  For more information, please visit www.amvescap.com.



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