How to Get a Medallion Stamp
Finding a medallion stamp can be challenging, as most financial institutions that offer them prefer existing customers over potential ones. A medallion stamp serves as a high-security ink that verifies an individual’s signature and legal authority to transfer securities.
Transferring securities between accounts can be necessary when moving them between accounts, giving them as gifts or transferring ownership after someone passes away.
What banks offer medallion signature guarantee?
Medallion signature guarantees are available through participating banks and credit unions in the US. Before arriving, be sure to call ahead and verify if a guarantee will be offered; furthermore, ensure the officer stamping your documents has an acceptable surety limit in place; it is advisable to inquire as well about what maximum value assets they are willing to guarantee.
Medallion signature guarantees may be needed when making changes to retirement accounts such as 401(k), such as when switching jobs; transferring stocks or bonds to an estate-appointed representative, transferring shares from one company to another beneficiary or donating securities to charitable organizations. You can obtain one online through various providers that do not require physical visits for registration.
These services typically charge a nominal fee for this service, typically far less than what would be spent on notary embosser.
Why are they so hard to get?
One of our readers recently posted to our forum that he was having difficulty getting his local banks to provide him with a Medallion Signature Guarantee, often mistakenly believed to be similar to notary stamping, which pertains specifically to securities and can only be provided by financial institutions approved by the Securities Exchange Commission (SEC).
Financial institutions assume significant liabilities by issuing guarantees to anyone who requests them; typically only providing them to existing or long-term customers for a small fee.
You typically require a medallion signature guarantee when transferring securities between accounts (e.g. 401k), gifting securities or administering an estate that contains stocks traded on US or Canadian stock exchanges. It provides assurance to transfer agents that your signature is genuine and you have legal authorization to transfer these shares, with liabilities taken on by financial institutions backed by assets to cover any fraud or forgery claims that arises against their asset base.
Where can I get a medallion signature guarantee?
Medallion signature guarantees are available from many banks and credit unions in the US. In general, you need an existing relationship with them as well as proof of identity; additionally you will need documentation related to your transaction for which the guarantee is being requested such as ownership statements of securities held as collateral, letters of intent and any relevant legal documents.
Reasons for medallion signature guarantees include verifying that the signature authorizing the transfer or sale of security is authentic, as well as that you possess legal capacity for such moves. It’s an essential step of the process and much harder for fraudsters to falsify than getting documents notarized; medallion signature guarantees are backed up by bank assets while notarization relies upon trustworthiness alone.
What are the requirements for getting a medallion signature guarantee?
Financial institutions that participate in medallion programs can only offer signature guarantees if they have established relationships with customers – usually banks, credit unions and brokerage firms that already know who their customer is.
Signature guarantees are more reliable than notarization because they focus on the bank rather than on individuals signing documents; hence providing more secure endorsement for transfers of securities than notary stamps can.
Financial institutions typically only issue signature guarantees to customers with strong relationships who request one and for a nominal fee, so it is wise to plan ahead as it could take longer than having a notary attest a document. Therefore, contact your financial institution early and inquire whether they offer medallion signature guarantee programs.
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