MEDALLION STAMP GUARANTEES
A Medallion Guarantee is a certification used for transferring securities provided by an eligible guarantor institution with a membership in an approved signature Medallion Guarantee Program. The Medallion stamp is bright green in color that certifies the signature on a stock power or endorsed stock certificate as authentic and that the institution affixing the stamp accepts liability for any forgery. The Medallion Guarantee is not the same as an acknowledgement by a notary public. It is a special signature guarantee designed for the securities industry to protect your stock and prevent forgeries.
We require an original Medallion Guaranteed signature to transfer shares in order to protect you from fraud or theft. You may obtain a Medallion Guarantee Stamp from a financial institution such as your bank, credit union, or broker dealer that participates in one of the three Medallion Programs listed below:
- STAMP (SECURITIES TRANSFER AGENTS MEDALLION PROGRAM)
- SEMP (STOCK EXCHANGES MEDALLION PROGRAM)
- MSP (NEW YORK STOCK EXCHANGE MEDALLION SIGNATURE PROGRAM)
MEDALLION SIGNATURE COVERAGE
A Medallion Signature Guarantee must cover the full amount of the security being transferred. It’s important to acquire a coverage level that is equal to or greater than the amount of the transaction.
Each Medallion has a unique identification number with a letter prefix signifying the dollar amount insured by the Guarantor. Each prefix has a corresponding amount of coverage as listed below:
A: $1,000,000
B: $750,000
C: $500,000
D: 250,000
E: $100,000
F: $100,000
X: $2,000,000
Y: $5,000,000
Z: $10,000,000
In case you are wondering why a medallion guaranteed stock power is required: UCC Article 8 requires proper endorsement any time securities are transferred out of the current name. To comply with this rule, the industry best practice is getting the Medallion Guarantee stamp. The Medallion Guarantee protects all parties by confirming that the person signing is the appropriate person to sign and it provides insurance for that transaction.
Click here to learn what the SEC says about medallions.