The U.S. Securities Exchange Commission is investigating Wall Street analysts who cover Apple over the possibility that 'channel checks,' routine checks with suppliers and manufacturers, constitute insider trading.

Wall Street analysts were shocked recently when federal prosecutors began investigating them over routine supply chain research data, The Wall Street Journal reports. Though it appears that no analysts have been charged, the Securities and Exchange Commission probe is part of a broadening of the definition of insider trading.

"Insider trading basically comes down to where you know or ought to know that the person from whom you're getting this information has a duty to someone else to keep it confidential," said Paul Atkins, former commissioner for the SEC. "If you go in and pay the mail clerk to give you special information, that's not proper."

According to the report, the investigation centers around channel checks where analysts contact manufacturers' representatives "to gauge how a business is performing."

Channel checks are common among analysts covering Apple, who is known for being highly secretive about future plans or production figures. Analysts report information from channel checks to investors through "build plans," which have become almost as significant as Apple earnings.

"Expert network" firms, which charge a fee to investors for connecting them with employees of companies, are also part of the investigation.

As examples of channel checks, the Journal cited a recent RBC analyst report on increased iPad production and a Rodman & Redshaw report on low iPad production volumes that may have caused Apple shares to tumble.

Investors are "wary" and have been meeting with compliance officials and lawyers to gain clarity about the issue.