Hip-Hop mogul Jay-Z has reportedly backed out as an investor in AEG’s bid to operate the racino being built at Aqueduct Race Track. The company’s winning bid was put under a microscope by the government, and the rapper along with others involved have been subpoenaed to appear in Federal court.

The embattled governor of New York is accused of using his authority along with a secretive bidding process to select the group, which is made up of several of his friends, in return for political favors. Queens minister Floyd Flake, who has also been subpoenaed in the case, has also dropped his stake in AEG.

Speculations as to why the two have backed out, point to recent news that top aides in the Governor’s office told AEG that the state would “withdraw its support” if they did not submit applications for all of its investors to obtain a gaming license from the New York Lottery.

The new rule would mean that Jay-Z would have to provide a detailed rundown of both his and his wife, Beyonce’s financial situation.

Sources for The Observer say that he was concerned that confidentiality regarding their personal information could not be maintained.

In related news, Jay is finishing up his 2010 Blueprint 3 tour this month, with stops in Boston, Detroit, Chicago, St. Louis, and Los Angeles, amongst others.