An earlier SEC investigation ended in 2006 due to a lack of evidence
The US financial watchdog, the Securities and Exchange Commission (SEC), has reopened an insider trading inquiry into Microsoft, reports say.
The SEC is to examine again whether hedge fund Pequot Capital Management traded the shares on information from a former Microsoft worker it had hired.
The regulator closed an earlier probe in 2006 due to "insufficient evidence".
Pequot, which is a $4.3bn hedge fund, and its founder and chairman Arthur Samberg, have denied any wrongdoing.
The SEC 's earlier investigation had focused on the firm's investment in Microsoft shares, which yielded it at least $2.1m in profits in April and May 2001.
Then, investigators found "insufficient evidence to bring a case", according to report by SEC attorneys closing the case in 2006.
Now, according to a source close to the renewed investigation, the SEC is reopening its inquiry.
So far the SEC has not publicly acknowledged reopening the probe and an SEC spokesman declined to comment on Thursday.
However, new information that surfaced in December has revived interest in the case.
Documents that emerged in a divorce proceeding in Connecticut showed that Pequot had begun paying $2.1m to a key witness in the original case in mid-2007.
The documents show a payment by Pequot of $700,000 at that time to David Zilkha, a former Microsoft employee later hired by the hedge fund.
Mr Zilkha received an additional $700,000 in mid-2008 and was set to receive the same amount this year, according to the documents in the divorce case between Zilkha and his ex-wife, Karen Kaiser.
Pequot spokesman Jonathan Gasthalter said the payments to Mr Zilkha were made "pursuant to the settlement of a civil claim related to his employment and termination by Pequot, that was first presented to the firm in January 2007 after all investigations had been closed".
Mr Gasthalter said on Wednesday that Pequot would cooperate fully with all requests for information and was confident that its trading in Microsoft shares "was at all times proper".
The reports of the re-launching of the investigation, by the The Wall Street Journal and The Washington Post, come at a time when the SEC has been under intense public and congressional criticism for lapses in its oversight and enforcement efforts.
As the scandal involving disgraced money manager Bernard Madoff emerged in December, revelations surfaced that staff at the SEC repeatedly failed over the course of a decade to fully investigate credible allegations against him.