Roman Porter, executive director of the Fair Political Practices Commission, said his agency would investigate whether DeStefano violated laws by failing to disclose income from an outside source and engaging in a conflict of interest.
Porter said the inquiry would also determine whether DeStefano violated "revolving door" statutes that require government employees to wait at least one year after leaving their jobs before lobbying their former agencies.
The FPPC imposes administrative penalties, but could refer evidence of criminal violations to state or local prosecutors.
The Times reported Wednesday that DeStefano had never filed financial disclosures required by the state for someone in his position.
DeStefano said he was not asked to file them, but commission records reviewed by The Times showed that he was notified of the requirement in 2008 and 2009.
Times staff writer Maeve Reston contributed to this report.