Jay-Z’s political ties are apparently stirring up a bit of controversy.

The New York Post reports that the rap mogul’s involvement with the Aqueduct Entertainment Group (AEG)—the consortium chosen to run a multi-billion dollar "racino" (a combined racetrack and casino) at the Aqueduct Racetrack in Queens—has ignited a federal investigation.

Apparently, authorities are skeptical about the selection of AEG to operate the new venture and what role Jay played in swaying New York Governor David Patterson’s decision.

Hov had been trying to get involved with the racino since last year. A source told the Post that the hip-hop star eventually linked up with casino mogul Steve Wynn, who at the time was bidding for control. The source went on to claim that when Wynn’s deal went sour, AEG scooped up Jay to appeal to the governor.

"[Gov.] Paterson directly told Wynn he needed to have a minority partner, so he went and got Jay-Z,” the source said. “But when Wynn pulled out, Jay-Z was without a home."

When contacted AEG denied that it courted the hip-hop honcho to win the governor’s favor.

"Given [Jay-Z's] superstardom and his long and deep connection to New York, the partners thought he could bring a unique perspective to shaping a facility that would truly be an entertainment destination," AEG spokesman Jonathan Rosen told the Post. "The partners were looking to bring in someone who could bring marketing and community advice to the team."

A rep for Paterson also refuted the claims. "There is absolutely no relationship between Governor Paterson's friendship with Jay-Z and the choice of AEG."

Paterson is known for having a relationship with the 40-year-old rapper—who has a seven percent stake in AEG. The Governor was personally invited as Jay’s guest during his 9-11 benefit concert at Madison Square Garden last year, has been spotted dining with the rap star and has spoken to several publications about Hov’s importance to the city of New York.

As of press time Jay has yet to comment on the reports. —Elan Mancini