Thursday, March 26, 2009

Medallion Signature Guarantee

An important tool in the financial industry, especially for the transfer agents, is the Medallion Signature Guarantee stamp. The picture above is a generic example of one I found online. You can get the stamp at most banks or financial institutions. These stamps are typically a light yellow/green stamp that is put onto forms and documents verifying that the person signing the document is the person that they say they are. This signature stamp verifies that the signature is authentic and legally binding.

The stamp is specific to the securities industry and acts a guarantee by the bank that the person is able to sign in the capacity that they are signing in. As an example, if a bank officer affixes a Medallion Signature Guarantee stamp to a letter signed by a person as the executor of an estate, that bank has now accepted liability if the person's identity is revealed to be fraudulent. This may vary depending on a person's specific situation, but generally, the bank providing the stamp will want to see documentation and proof of identification.

The MSG stamp is traceable because it has numbers on it that identify each stamp. This is an excellent tool for verifying that the person signing a document is who they say they are. Transfer agents such as myself can use the complete, clear and unsmudged stamp to ensure a person's identity and authority prior to performing any actions on an account. To learn more about this tool, visit the SEC's website HERE.

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