The U.S. Securities and Exchange Commission (SEC) is examining how electronic bond-trading platforms allow dealers to give clients different prices on the same securities in the $40 trillion market, potentially hurting smaller investors.

SEC regulators want to understand why brokers sometimes block their rivals and clients from seeing some of their prices for municipal, corporate, and other bonds, according to a person with direct knowledge of the examination. They're concerned that being able to turn quotes on and off may allow market manipulation, and that smaller buyers may not get the best prices, the person said.

The probe underscores the growing concern that the infrastructure of the U.S. bond market hasn't kept pace with a 23 percent expansion in the past six years, with much of the trading still conducted through telephone conversations and emails. One of the SEC's priorities this year is to evaluate "factors that may impact the quality of execution in the fixed-income market," including market structure and the use of alternative trading systems, it said in a January statement.