A medallion signature guarantee is a unique certification stamp used to ensure the authenticity of signatures that verify the transfer of securities, such as stocks, bonds, or options. It is provided by banks, credit unions, brokerage firms, or other financial institutions that are members of a medallion signature guarantee program, such as the Securities Transfer Agents Medallion Program (STAMP) or the Stock Exchange Medallion Program (SEMP).
You might need a medallion signature guarantee when you transfer securities to a new account, give them as a gift, donate them to a charity, or transfer ownership to a court-appointed representative after the owner of the securities dies. The guarantee protects your position as a shareholder and the financial institution that is involved in the transaction. The cost of obtaining a medallion signature guarantee stamp is relatively affordable, usually ranging from $10 to $50, and some institutions offer it for free to long-term customers.
A notary stamp is a tool used to notarize documents. Notaries are public officials who witness signatures on legal documents and verify that the signer is who they claim to be. A notary stamp is used to indicate that the document has been notarized and that the notary has verified the identity of the signer. Documents that can be notarized include affidavits, deeds, contracts, powers of attorney, and other legal documents. Notaries can also administer oaths and affirmations, certify copies of documents, and provide a witness to the signing of documents.
A medallion signature guarantee, on the other hand, is a tool used to verify the authenticity of signatures on securities transactions. The medallion signature guarantee is a special stamp that verifies the identity of the person signing the document and confirms that the signature is genuine.
Medallion signature guarantees are typically required for transactions involving the sale, transfer, or redemption of securities, such as stocks, bonds, and mutual funds. This guarantee is used to prevent fraudulent transactions, such as the unauthorized transfer of securities. Medallion signature guarantees can only be provided by authorized financial institutions, such as banks, broker-dealers, and credit unions. These institutions are required to follow strict guidelines and regulations to ensure that the guarantee is valid.
While both the medallion signature guarantee and notary stamp verify the identity of the signer, they serve different purposes. The notary stamp is used for general notary transactions, while the medallion signature guarantee is used for securities transactions. Notary stamps can be used for any type of document, while medallion signature guarantees are limited to securities transactions.
Comments