The Need for a Medallion Signature Guarantee

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hachiko
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The Need for a Medallion Signature Guarantee

Post by hachiko »

I'm not sure if I'm just noticing it now, and just wasn't paying attention before, but I feel like I'm seeing a lot of references to Medallion Signature Guarantees. Both on Bogleheads and even in advertisements for banking deposit accounts now. I'm pretty sure the latter is a new thing in advertisements at this frequency. My poor googling skills indicate that the primary reason is for transferring physical stock certificates, but that can't possibly be more common now than it was 5 years ago. Is there some other common reason that Medallion signatures are necessary?
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123
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Re: The Need for a Medallion Signature Guarantee

Post by 123 »

When a financial institution guarantees your signature with a Medallion Signature Guarantee they are taking all the risk if the signature turns out to be fraudulent. If the Medallion Signature Guarantee resulted in the release of $1,000,000 in assets they would be liable for that amount to the financial institution that relied upon the Medallion Signature Guarantee to release the assets.
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tomsense76
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Re: The Need for a Medallion Signature Guarantee

Post by tomsense76 »

Usually because one decides to move some or all assets from one brokerage to another.

Haven't seen these ads, but sure can speculate. A bunch of new investors entered the market last year. While they may have setup a brokerage at one institution, they may now be rethinking whether they want to continue doing business there.

This also can come up with TreasuryDirect for buying Savings Bonds, but there are other types of signatures TD accepts. Have noticed more talk about I Bonds as inflation has spiked in recent months.
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camden
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Re: The Need for a Medallion Signature Guarantee

Post by camden »

123 wrote: Tue Oct 26, 2021 8:51 pm When a financial institution guarantees your signature with a Medallion Signature Guarantee they are taking all the risk if the signature turns out to be fraudulent. If the Medallion Signature Guarantee resulted in the release of $1,000,000 in assets they would be liable for that amount to the financial institution that relied upon the Medallion Signature Guarantee to release the assets.
And because of this, if my recent experience is any guide, you may have a devil of a time actually getting one, even from a financial institution with whom you have had a longstanding relationship as a customer.
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JoMoney
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Re: The Need for a Medallion Signature Guarantee

Post by JoMoney »

The only things I've needed MSG for were to transfer some directly owned stock certificates to a brokerage account, and for changing a bank account with Treasury Direct. TD says they can take other types of signature stamps from a financial institution, but explicit say a notary is not acceptable - and a notary is the only thing the banks I checked with would be willing to assist with (the ones that didn't do MSG).
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PaunchyPirate
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Re: The Need for a Medallion Signature Guarantee

Post by PaunchyPirate »

I was required to get a Medallion Signature Guarantee back in 2015 when I wanted to move a sizeable brokerage account from TD Ameritrade to Vanguard. I don't recall which side required the Medallion, but I think it was Vanguard. Fortunately, my local banker at my PNC Bank branch was willing to do this. But, I'm not sure they still would do it. Last year the same banker told me they couldn't do a simple notarization of a document any longer.
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djmbob
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Re: The Need for a Medallion Signature Guarantee

Post by djmbob »

I recently inherited a TransAmerica Vanguard Annuity from my mom. The paperwork said I needed a Medallion Sig Guarantee and they said just to mail a copy of my drivers license instead.
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dbr
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Re: The Need for a Medallion Signature Guarantee

Post by dbr »

Fidelity asked me for a medallion signature guarantee for a recent gift transfer of stock to another person's account. An alternative was to visit a local office and sign there, which I did.
Arlington2019
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Re: The Need for a Medallion Signature Guarantee

Post by Arlington2019 »

camden wrote: Wed Oct 27, 2021 7:32 am
123 wrote: Tue Oct 26, 2021 8:51 pm When a financial institution guarantees your signature with a Medallion Signature Guarantee they are taking all the risk if the signature turns out to be fraudulent. If the Medallion Signature Guarantee resulted in the release of $1,000,000 in assets they would be liable for that amount to the financial institution that relied upon the Medallion Signature Guarantee to release the assets.
And because of this, if my recent experience is any guide, you may have a devil of a time actually getting one, even from a financial institution with whom you have had a longstanding relationship as a customer.
I had to get one a couple of years ago when I was using a wire transfer from my IRA with Merrill Lynch to buy a SPIA from New York Life. I first went to my local Bank of America. I started using BofA back in 1978 when it was still SeaFirst, a regional bank in Washington state. The Merrill rep at the BofA wouldn't do it, and pointing out that I had over a million on deposit between BofA and Merrill was not persuasive to them. I ended up going to the local Chase bank, where the only relationship I had with them was an Amazon credit card. They happily did the Medallion for me. I complained to BofA and they gave me a lame excuse about the Merrill rep being unfamiliar with the process.
furwut
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Re: The Need for a Medallion Signature Guarantee

Post by furwut »

JoMoney wrote: Wed Oct 27, 2021 7:44 am The only things I've needed MSG for were to transfer some directly owned stock certificates to a brokerage account, and for changing a bank account with Treasury Direct. TD says they can take other types of signature stamps from a financial institution, but explicit say a notary is not acceptable - and a notary is the only thing the banks I checked with would be willing to assist with (the ones that didn't do MSG).
Yeah, I’ve been trying various banks to get a signature guarantee to update my TreasuryDirect account and, so far, have struck out. It would be great if the Post Office offered this service (even for a fee). They currently do processing for passports so this would be similar.
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JoMoney
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Re: The Need for a Medallion Signature Guarantee

Post by JoMoney »

furwut wrote: Wed Oct 27, 2021 6:56 pm
JoMoney wrote: Wed Oct 27, 2021 7:44 am The only things I've needed MSG for were to transfer some directly owned stock certificates to a brokerage account, and for changing a bank account with Treasury Direct. TD says they can take other types of signature stamps from a financial institution, but explicit say a notary is not acceptable - and a notary is the only thing the banks I checked with would be willing to assist with (the ones that didn't do MSG).
Yeah, I’ve been trying various banks to get a signature guarantee to update my TreasuryDirect account and, so far, have struck out. It would be great if the Post Office offered this service (even for a fee). They currently do processing for passports so this would be similar.
If they would simply accept a notary signature, that would make it heaps easier. Or even better, simply only allow linking to a US bank that's in the same name as that of the TD account owner, send a notification to the owner that a new bank was linked, and not allow withdrawals for 30 days or such.
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UpperNwGuy
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Re: The Need for a Medallion Signature Guarantee

Post by UpperNwGuy »

Catch 22:
— Many financial institutions want a medallion signature guarantee.
— Few financial institutions are willing to issue a medallion signature guarantee.
camden
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Re: The Need for a Medallion Signature Guarantee

Post by camden »

UpperNwGuy wrote: Wed Oct 27, 2021 7:16 pm Catch 22:
— Many financial institutions want a medallion signature guarantee.
— Few financial institutions are willing to issue a medallion signature guarantee.
Exactly. The customer is currently caught in the middle of this fight.
Robdac
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Re: The Need for a Medallion Signature Guarantee

Post by Robdac »

UpperNwGuy wrote: Wed Oct 27, 2021 7:16 pm Catch 22:
— Many financial institutions want a medallion signature guarantee.
— Few financial institutions are willing to issue a medallion signature guarantee.
This.

We recently tried to transfer a 529 between institutions. The outgoing institution demanded a MSG for any amount over $75K. It became such a pain that we moved $70K and will wait a year and move the rest of it. Neither institution was any help and our local bank refuses to do it for third party transactions.
Last edited by Robdac on Wed Oct 27, 2021 7:50 pm, edited 1 time in total.
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Harry Livermore
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Re: The Need for a Medallion Signature Guarantee

Post by Harry Livermore »

UpperNwGuy wrote: Wed Oct 27, 2021 7:16 pm Catch 22:
— Many financial institutions want a medallion signature guarantee.
— Few financial institutions are willing to issue a medallion signature guarantee.
... and that is why they should be outlawed.
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daleddm
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Re: The Need for a Medallion Signature Guarantee

Post by daleddm »

Was expected to provide one every step along the way for transferring parents (exceedingly minimal) fractional shares of stock into my name, BUT they'd waive it for a fee - about $30 per account, per transaction. What a racket.
TropikThunder
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Re: The Need for a Medallion Signature Guarantee

Post by TropikThunder »

UpperNwGuy wrote: Wed Oct 27, 2021 7:16 pm Catch 22:
— Many financial institutions want a medallion signature guarantee.
— Few financial institutions are willing to issue a medallion signature guarantee.
And I bet some institutions are on both lists.
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