Morrisons' group treasurer and head of tax is under investigation as part of an insider trading probe undertaken by the Financial Conduct Authority (FCA).
Paul Coyle was arrested in Harrogate, Yorkshire, last month over allegations of insider trading in connection with the supermarket's lucrative tie-up with online grocer Ocado, according to the Daily Telegraph.
He is being investigated over allegations of buying an unknown amount of shares of the online grocer before the deal to deliver Morrisons' groceries was announced, which sent the shares rocketing last May. At the time, authorities said a 49-year old man's home in Yorkshire had been raided by police.
As part of the £216 million tie-up, Morrisons agreed to invest £46 million in Ocado's Dordon distribution centre in the Midlands as well as making an initial payment to the online grocer of £170 million. Shares in Ocado — which floated in 2010 at 180p — have more than tripled since the deal was announced.
It has been reported that Mr Coyle has not returned to work since the arrest took place. He is yet to be charged and the investigation continues.
Morrisons issued a profit warning earlier this month following a disappointing Christmas trading period, which saw like-for-like sales decline 5.6 per cent in the six weeks to January 5 compared with a year earlier, sending shares tumbling 7 per cent.
The supermarket slashed its full-year profit forecast to £783 million from £812 million.
The FCA and Morrisons declined to comment. Mr Coyle could not be reached.