A Medallion Signature Guarantee (MSG) verifies who is signing and their authority for a securities transaction. It protects the receiving financial institution and issuer against forged or unauthorized signatures by placing liability on the guarantor (within that guarantor’s value limit). It does not guarantee share value, tax treatment, or the accuracy of transaction details.
What a Medallion Signature Guarantee Is
A specialized bank/credit union/approved provider stamp used for securities (stocks, mutual funds, bonds).
Confirms: (1) the signer’s identity, and (2) their legal authority for the action requested.
What It Protects
Primary protection: Transfer agents and issuers against losses caused by a forged or unauthorized signature.
Who is covered: The receiving financial institution/transfer agent and issuer.
How: The guarantor assumes liability up to its program limit if the signature is not genuine or authorized.
What It Does Not Protect
Market performance, pricing, or settlement outcomes
Tax consequences or withholding decisions
The accuracy of share counts, account numbers, or instructions you provide
Underlying legal disputes among owners/beneficiaries
When You Typically Need One
Stock power / transfer of ownership
Name change or re-registration
Gifting shares
Estate and trust distributions
Corporate actions (mergers, internal transfers)
Some transfer agents require a Medallion based on value thresholds or account type. Always check their instructions.
Medallion vs. Notary vs. “Regular” Signature Guarantee
Medallion: Securities-specific; includes financial liability by the guarantor; widely required by transfer agents.
Notary: Witnesses identity/signing—no securities liability; usually not accepted in place of Medallion.
Bank “signature guarantee” (non-Medallion): May not be accepted for securities transfers.
Value Limits & Programs
Guarantors participate in Medallion programs and stamp only up to a defined dollar limit.
If your transaction value exceeds our limit, we’ll advise alternatives or next steps.
Examples
Single owner → transfer to a new brokerage: Medallion required by receiving firm.
Trustee re-registering shares from a trust: Medallion plus trust pages showing trustee powers.
Multiple beneficiaries: Either all sign together, or provide proof others’ portions were completed—see “Multiple Beneficiaries” FAQ.
Disclaimer
This information is general guidance, not legal or tax advice. Specific requirements may depend on the transfer agent.
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