NEW YORK (CNN/Money) - Merrill Lynch & Co. and New York Attorney General Eliot Spitzer have outlined a deal that could keep the nation's biggest brokerage firm from facing civil or criminal charges in the investigation of its stock practices, a newspaper reported Wednesday.

While a spokesman for Spitzer said the "framework" for the deal was not a guarantee that an agreement would be reached, the attorney general postponed Merrill's court hearing for a week, to May 16, to give the two sides more time to work something out, the Wall Street Journal said.

Sources close to the talks said the sides have found a common ground and a deal that would change Merrill's practices could be days away, according to the report. The deal could include fines of tens of millions of dollars, agreement to independent oversight of some of Merrill's research and a statement of contrition, the Journal said.

Spitzer has been adamant about the separation of the firm's investment banking and analyst research practices in past negotiations during the investigation.

The issue of analysts' conflict of interest heated up after Spitzer released e-mails in April showing Merrill analysts privately disparaging stocks that they were aggressively hawking to the public. The attorney general said the evidence indicated the analysts were influenced by Merrill's banking relationships with companies the firm covered.

Spitzer obtained a court order demanding more disclosure from Merrill about its banking relationships and is currently negotiating with the firm for more concessions.

On April 25, the Securities and Exchange Commission launched a formal investigation into conflicts of interest between research and banking, which SEC Chairman Harvey Pitt called "the next step" in a year-long review of the practices of Wall Street analysts.

SEC commissioners will vote on a set of proposed rules Wednesday in an effort to combat possible conflicts of interest.

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The changes include prohibiting analysts from threatening to withhold a favorable research rating or specific stock price target to win investment banking business for their firms; a requirement to clearly define their stock ratings and explain changes; and a prohibition against analyst compensation being tied specifically to investment banking transactions.

Merrill (MER: Research, Estimates) shares fell 21 cents to $40.80 Tuesday.