The Tokyo Stock Exchange employee who is suspected of being involved in an insider trading case belonged to a division handling timely disclosure announcements by listed companies, informed sources said Thursday.

The employee in his 20s, who has been with the TSE for a few years, was removed from that assignment after the Securities and Exchange Surveillance Commission launched a compulsory investigation into the case in September, according to the sources.

The investigation, which covered related locations, including the employee's home, was launched on suspicion of financial instruments and exchange law violations.

According to the sources, the employee allegedly leaked undisclosed information about multiple companies, including on a tender offer bid, that he learned through his work, to a relative, recommending stock trading. Based on the information, the relative is seen to have repeatedly traded stocks and made profits totaling at least several hundred thousand yen, the sources said. Trading by the employee himself has not been confirmed so far.

The commission is investigating the detailed circumstances with a view to filing charges with the special investigation squad of the Tokyo District Public Prosecutors' Office.

This is the first time that a TSE employee has become subject to a compulsory investigation by the securities market watchdog for an allegation of involvement in insider trading.

The financial instruments and exchange law bans people who obtained important undisclosed information through work from feeding such information to others before announcements and encouraging them to trade stocks.

In a statement issued on Wednesday, Japan Exchange Group, which operates the TSE, said that it will "continue to make every effort in cooperating with this investigation."

"We would like to offer our sincere apologies for the inconvenience and concern this will cause among our listed companies and other related parties," it said.