“The New York attorney-general is investigating whether Wall Street banks and their equity analysts gave select fund managers early warning of changes to stock recommendations, by filling out surveys for clients that hinted of their intentions.

“Eric Schneiderman said on Thursday that banks had become a target of his wide-ranging investigation into what he called ‘insider trading 2.0’, after earlier agreeing a settlement with BlackRock under which it agreed to cease all analyst surveys.

“BlackRock, the world’s largest fund manager, ran regular polls to gather more nuanced or quantitative information than analysts publish in their formal research notes. One internal document cited in the settlement explained its intention as: ‘We are trying to front-run rec[ommendations]’.

“Mr Schneiderman said BlackRock had agreed to ‘be part of the solution rather than part of the problem’ by co-operating with a wider examination of relationships between fund managers and equity analysts. It will pay only the costs of the investigation, about $400,000, and has not accepted or denied wrongdoing.”

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