Key recommendations of the high-level committee appointed by Securities and Exchange Commission Chairman Arthur Levitt Jr. to change the way securities brokers are compensated:
* Eliminate higher commissions for in-house "proprietary" products. These include a brokerage firm's own family of mutual funds. At some firms, brokers get bigger commissions for selling shares in these funds, even though the funds' performance may be lackluster.
* Base a portion of a broker's compensation on the amount of assets in an account. Currently, most brokers are paid based only on how many transactions they make, such as buying and selling stocks. The report calls the system too entrenched to do away with completely.
* Disclose hidden fees and commissions paid to brokers for selling certain products. For example, a firm that was a lead underwriter in bringing a new issue of stock to market may pay brokers extra to help it sell all of the shares to the public. If firms disclose the fees, customers will be better able to judge whether a broker has an ulterior motive for recommending a particular stock.