Concerned about a federal report's finding that half of securities arbitration awards go

unpaid, the

National Association of Securities Dealers

this month will begin suspending firms that don't certify that they've paid these claims within 30 days.

The NASD also has begun notifying investors who win arbitration cases against their brokers and other financial services companies of their rights to collect, and urging them to complain if they haven't been paid.

"If there's silence from the firm and silence from the customer, our assumption will be that there hasn't been compliance," said George Friedman, the NASD's senior vice president and director of dispute resolution.

In a further move to help recover payments in securities claims -- though it is likely to be controversial -- the NASD plans to begin allowing investors to sidestep the arbitration process and sue some companies directly in the courts. The NASD will propose that change to the

Securities and Exchange Commission

by the end of the year, Friedman said. It would apply only to companies that have been terminated from the securities dealers association.

The association has proposed the package of changes in response to congressional pressure and a critical June report about arbitration awards payments from the

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General Accounting Office

. The report found that half of the investors who won arbitration claims against their brokers in 1998 never saw a penny of their awards. It also found that two-thirds of investors who won arbitration cases reported getting paid nothing or only a small percentage of their awards. Of the $161 million awarded in those cases, about 20% actually was paid.

The NASD's proposals were welcomed by Mark Maddox, president of the

Public Investors Arbitration Bar Association

, a lobbying group that represents investors in securities disputes. Maddox called the new payment-reporting requirement for firms that lose arbitration cases a "baby step in the right direction."

The NASD's Friedman acknowledged that the reporting requirement will do little to help assure payment from firms that have gone out of business. And that's a large chunk of the problem. About 90% of the unpaid awards involve defunct firms, he said.

However, the NASD also plans to enact a new rule that will speed up the arbitration process in cases against defunct firms, from which there's little realistic chance of award recovery, he said. And the NASD will begin making quarterly reports to the SEC about the success of award recovery in arbitration cases.

The most significant of the changes the NASD has on the table, Maddox said, is the proposal to allow investors to sue some brokerages directly in civil courts. His group believes investors should have a choice of where to challenge their brokers in disputes.

Recent federal case law, however, has strengthened arbitration agreements that are standard between investors and brokers, and has for the most part closed the doors of the courts to broker-investor disputes.

Friedman predicted such a change won't come about easily. "Of all the changes and proposals, that one will probably generate the most interest and controversy," he said.