Question: I am transferring stocks and must obtain a medallion signature guarantee stamp on the transfer form. What is this and how do I get one?
Answer: Certain financial transactions require special security precautions. Businesses are very conscious of identity fraud when their stocks are transferred by stockholders. As a means to guarantee against forgery, medallion signature guarantee programs were implemented by financial institutions, banks and credit unions. This way, one institution can rely upon the identity verification made by another.
For example, you hold an account with a local bank, which allows them to guarantee your identity to the financial institution handling the transfer of your stock. If the two companies belong to the same medallion program, they can rely upon each other’s guarantee. This verification process is seen as stronger than a simple notarization, because of the guarantee involved.
Most local banks or credit unions offer the ability to handle your medallion guarantee needs. Call ahead of time to be sure the agent is free to perform your signature guarantee. While a nominal fee may be charged, many institutions offer the service as a courtesy to their customers.
A list of participating financial organizations can be found online at www.stai.org.