(Bloomberg) -- Bank of America Corp. has suspended equity trading with hedge fund Segantii Capital Management over concerns related to its wagers on large stock sales, according to people familiar with the matter.

The bank made the decision to sever such activity in early 2021, one of the people said, asking not to be identified discussing private information. Citigroup has also suspended equity trading with Segantii though continues to trade with it in other financial instruments, according to the Financial Times, which first reported both the moves Wednesday. 

The developments underscore how financial institutions are taking a closer look at practices and potential risks amid a sprawling probe by US authorities into how Wall Street handles block trades. Investigators are scrutinizing whether bankers improperly tipped off investors to stock sales large enough to send prices of shares swinging, with banks including Morgan Stanley fielding requests for information from authorities.

Representatives for Citigroup and Bank of America declined to comment, while Segantii didn’t have an immediate comment. The banks were both listed as Segantii’s prime brokerage firms in December regulatory filings.

Hong Kong-based Segantii was set up in 2007 by British businessman Simon Sadler, who also owns the English football club Blackpool FC. The company invests globally as part of “a multi-strategy investment approach,” according to its website.

A former Segantii employee was among a broad roster of names at banks and investment firms whose communications are being sought by the Justice Department amid the block-trading investigations, Bloomberg News reported earlier this year. Hedge funds that participate actively in block trades typically maintain ties with multiple banks, drawing on those relationships to dip into the flow of available stock deals. 

Goldman Sachs Group Inc., which the Wall Street Journal reported earlier this year had also received requests for documents from authorities relating to block trades, cut ties with block-trading hedge fund Islet Management, Bloomberg reported in March. The reason for the decision -- and whether it related to the investigation -- couldn’t immediately be determined.

Block trading is one of a few Wall Street businesses where relationships still drive the flow of deals. Banks acquire a slug of stock from an investor -- such as hedge funds, private equity firms or venture capital firms -- at a discount, before parceling the shares out discreetly to buyers. The aim is to price the blocks at a slim premium, and to avoid sending a stock’s price into a dive before the transaction is completed, which can inflict losses.

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