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Wells Fargo Securities sues commodity pool, operator over missed payments

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Wells Fargo Securities sues commodity pool, operator over missed payments

Wells Fargo Securities LLC sued commodity pool LJM Investment Fund LP and its operator, LJM Partners Ltd., over missed required margin payments.

The lawsuit, filed in the United States District Court of the Southern District of New York, seeks to recover about $16.4 million of damages for Wells Fargo Securities.

Wells Fargo Securities, in its role as clearing broker, allegedly paid more than $16 million to cover the commodity pool's margin and losses with the Chicago Mercantile Exchange following a stock market turbulence in February. The Wells Fargo & Co. unit is suing to get the money back, claiming that LJM Investment Fund did not make contractually required payments to cover the losses.

Well Fargo Securities claims that it made multiple attempts to collect the money from the respondents, to no avail. The company noted that under their agreement, all of the commodity pool's obligations will be treated "as immediately due and payable" if it fails to meet the terms of the agreement. LJM Partners is liable for LJM Investment Fund's obligations because it is the general partner, according to the lawsuit.

LJM Partners and LJM Investment Fund did not immediately respond to a request for comment.