The U.S.Securities and Exchange Commission today issued a settled cease-and-desist order against American Stock Exchange LLC for failing to enforce compliance with securities laws and rules and failing to comply with its record-keeping obligations.

In the order, the commission said that it found that from at least 1999 through June 2004, the Amex failed adequately to surveil for violations of order handling rules by Amex members and failed to keep and furnish surveillance and other records.

In addition, the commission instituted contested administrative proceedings against Sal Sodano, the Amex’s former chairman and chief executive officer, alleging that he failed to enforce compliance with federal securities laws and exchange rules by Amex members and persons associated with those members. These allegations have not been proven.

Linda Chatman Thomsen, director of the SEC’s Division of Enforcement, said, “Enforcing compliance with federal securities laws, and a self-regulatory organization’s own rules, is a central function of a self-regulatory organization. Today’s action against the Amex demonstrates that the commission will be vigilant in making certain that SROs fulfill their regulatory responsibilities.”

In its order, the commission censured the Amex and ordered it to cease and desist from violating securities laws, it also ordered it to comply with certain undertakings. The Amex consented, without admitting or denying the findings, to the issuance of the commission’s order.