Sometimes you will need to provide evidence of your signature with a medallion stamp, which differs from notary stamps in that it must be obtained from a financial institution that participates in medallion programs.
Most financial institutions only provide this service to their customers for an additional fee.
Banks are reluctant to provide them
A medallion stamp ensures the signature authorizing the transfer of securities is genuine and authentic, often required when dealing with physical certificates such as stocks or bonds. Transfer agents require this protection against liability associated with forgeries that could occur.
Financial institutions understandably are reluctant to make medallion stamps available just anyone, which exposes them to considerable liability risks. Instead, they typically limit them to members known to them and charge a nominal fee; one person who needed such a guarantee was told of an incident wherein one bank refused him one as they didn’t know who they were despite being asked by them directly for one.
Some financial institutions may provide alternative verification options, such as having documents witnessed by bank officers or having signatures certified, although this might not always be suitable in every situation; some transfer agents might not accept them so it is wise to check with them first before opting for these methods of verification.
They are expensive
Medallion stamps provide proof that you are who you claim to be, through an extensive screening process and secured bank assets, unlike notary stamps which simply confirm identity. Although some financial institutions will charge fees for this service, others offer it for free as long as you remain an existing customer.
Most banks, savings and loan associations, credit unions and brokerage firms offer medallion signature guarantees; however they do not cover signatures of individuals who are not their customers due to being required to accept liability in case any forgeries occur whereas notaries do not.
Medallion stamps are necessary when selling or transferring stocks or bonds that trade on US or Canadian stock exchanges, as guarantors use specialized security ink stamps that help prevent fraud. There are three such programs: STAMP, SEMP or MSP which all work similarly towards this goal.
They are time-consuming
Medallion stamps are among the many certification stamps used by financial institutions as an assurance that any signature authorizing the transfer of securities is authentic. As they could potentially face liability exposure resulting from fraudulent transactions, financial institutions like banks and credit unions tend to limit who they offer them to. As they may become exposed due to fraudulent activity occurring without existing accounts with them.
There are other alternatives to medallion stamps. One option would be using the services of a notary public; however, this could leave you vulnerable to fraud and should only be done after conducting due diligence on local laws regarding notary practices.
Alternative Options If you have an account at one of the banks listed, and want your transfer forms stamped by them directly, that process should typically take no more than a few business days; to speed things along it may be useful to contact that institution beforehand and see what requirements exist before arriving there.
They are difficult to obtain
A medallion stamp is a special certification that verifies that signatures on securities transfers are genuine, providing anti-money laundering and terrorism financing measures. Typically used when selling or transferring physical certificates of shares but may also be utilized electronically.
Only certified financial institutions are qualified to issue medallion signature guarantees, such as commercial banks, credit unions, trust companies, savings associations and broker dealers. Each one belongs to the Medallion Signature Guarantee Program which is overseen by the US Securities and Exchange Commission.
Acquiring a medallion stamp is often a complex and time-consuming process that takes dedication and patience, but with proper organization and compliant filing techniques this needn’t be so daunting. A medical writer can assist with navigating bureaucratic regulations to get your documents approved quickly.
