Fidelity Investments is gearing up for a fight with federal regulators now questioning a business relationship between a pair of siblings who handle a fraction of the fund giant’s trading business, The Boston Globe reports.

Fidelity trader David K. Donovan and his younger sibling, Peter Donovan, an employee of Bank of America Securities, are under investigation for forging an improper business relationship, attorneys close to the case said.

Regulators are now attempting to determine whether the brothers bilked Fidelity’s shareholders by conspiring to negotiate overpriced transactions in technology stocks. David Donovan is a leading technology trader at Fidelity.

The probe is another warning shot for Boston-based financial service firms that are on notice for pending crackdowns on incestuous deals that potentially compromise investors’ interests.

The Securities and Exchange Commission launched probes earlier this year into improper gifts exchanged between Fidelity and a number of firms that receive part of its brokerage business.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.