The Securities and Exchange Commission is investigating Bank of America to see whether it broke rules by speculating with its customers' funds, a person close to the matter said Tuesday.

The person, who spoke on condition of anonymity to AFP, said the trades took place in Merrill Lynch, bought by BofA in 2009 amid the financial crisis.

The use of customers' funds for trading on the bank's own account puts the money at risk if the trades turn sour, undermining the safety of the financial system. The practice violates rules designed to safeguard customers' assets.

The Wall Street Journal on Tuesday was the first to report on the SEC investigation of Bank of America, the second-largest US bank by assets, for trading that occurred between 2009 and mid-2012.

The SEC declined to comment.

Bank of America said it was cooperating fully with the inquiry.

"These transactions began at Merrill Lynch prior to the merger with Bank of America and received extensive review and approval. The firm fully complied with the rules designed to safeguard client funds," a BofA spokesman said in an email.