A pension fund for Ohio school employees has sued Wachovia Corp. and the company that now owns it, Wells Fargo & Co., over losses the fund sustained from investing in Wachovia's securities lending program.

The lawsuit, which the School Employees Retirement System of Ohio filed a week ago in federal court in Columbus, Ohio, alleges Wachovia breached is duties to the fund, costing it nearly $24 million. A Wells Fargo spokeswoman declined to immediately comment.

The pension fund has about $9.7 billion in market value and nearly 200,000 members.

It began investing in Wachovia's securities lending program in 2004 seeking "a low-risk mechanism" for institutional investors looking to earn "a nominal return … without any additional risk to their securities," according to the lawsuit.

Securities lending, a huge market for Wall Street banks, has faced questions after big losses in the financial crisis. In late 2009 the Securities and Exchange Commission said it would shine light on the "opaque" securities lending market. It was the first time in decades regulators focused on the multitrillion-dollar market.

The Ohio fund said Wachovia took cash collateral and invested it in places it never should have invested it, losing the pension fund millions.

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