Medallion Signature Guarantees: What Australians Can Do Instead

If a US transfer agent, fund or financial institution has told you your signature needs a Medallion signature guarantee, you have probably already discovered the problem: nobody in Australia seems able to give you one. Your bank has not heard of it, and a notary will tell you it is not something a notary provides.

That is not a failure of the people you asked. A Medallion guarantee is a US financial-industry stamp, not a legal act, and the institutions that issue it are overwhelmingly in the United States and Canada. The good news is that the organisation asking for it usually has another route for holders overseas. This page explains what the guarantee is, and the alternatives that actually work from Australia.

What a Medallion guarantee is

According to the US Securities and Exchange Commission's investor education site, a Medallion signature guarantee is required to transfer or sell securities held in certificate or registered form. It makes it harder for someone to steal your securities by forging your signature. The guaranteeing institution is, in effect, accepting liability if the signature turns out to be forged, which is why transfer agents insist on it.

It is issued by financial institutions that belong to one of three Medallion programs:

• STAMP, the Securities Transfer Agents Medallion Program, which the SEC's site describes as including more than 7,000 US and Canadian financial institutions
• SEMP, the Stock Exchanges Medallion Program
• MSP, the New York Stock Exchange Medallion Signature Program

The SEC's site advises getting the guarantee from an institution you already do business with. Institutions generally will not guarantee the signature of someone who is not their customer, because they are taking on the risk.

Why a notary cannot give you one

A notary witnesses your signature and confirms your identity. A Medallion guarantee goes further: a participating institution stamps the document and accepts financial responsibility for the signature being genuine and authorised. Only members of the three programs have the stamp. No Australian notary is a member, and a notarial certificate is not a substitute unless the organisation asking for the guarantee says it will accept one.

A US notary cannot give one either. This is not a gap in Australian notarial practice; it is simply a different kind of document.

What you can do instead

Work through these in order. The first two resolve most cases.

1. Ask the organisation what it accepts from overseas holders

The SEC's site says that if you cannot obtain a Medallion guarantee, you should contact the transfer agent or the company that issued the securities. Many have a procedure for holders outside the United States. Depending on the agent and the amount involved, that might be:

• a signature notarised before a notary in your country, sometimes with an apostille
• a signature guaranteed by your local bank, sometimes together with a notarised signature
• an affidavit or indemnity in the agent's own form
• a different procedure for smaller holdings

These are the agent's own rules and they differ between agents. Ask in writing, quote your holder or account number, and ask for the exact wording or form they want. Do not book a notary until you have that answer.

2. Move the holding into a brokerage account

Where the shares are held directly on a register, transferring them into a brokerage account — Australian or US — can be simpler than a registry transfer, and the broker may handle the paperwork with the agent. Whether this avoids the guarantee depends on the broker and the agent; ask both.

3. Use an overseas branch of a US or Canadian institution you bank with

The SEC's site notes that you may be able to get a Medallion guarantee from an overseas branch of a US or Canadian bank, broker or credit union with which you do business. If you have an account with such an institution that has a presence in Australia, ask it directly.

4. Use a US account next time you are there

If you still have a US bank or brokerage account and will be in the United States, a branch there can provide the guarantee in person. Some people find this is the only practical option.

When the form says "Medallion or notary"

Not every US form that mentions a Medallion guarantee requires one. Some accept a notarised signature as an alternative. The US Treasury's form for redeeming paper savings bonds is an example: it accepts a notary's seal, a financial institution's seal or a Medallion stamp, and for small amounts no certification at all.

For US savings bonds specifically, the US Embassy in Australia lists several options, including signing before a US consular officer, or signing before an Australian notary and then having the document apostilled by the Department of Foreign Affairs and Trade. The US Treasury publishes its own list of who may certify signatures abroad. Read your form's instructions carefully.

Where an Australian notary is acceptable, the process is ordinary: bring the form unsigned, with your passport, sign in front of the notary, and check whether the recipient wants an apostille from DFAT on the notary's signature. Only DFAT can issue an apostille.

Before you sign anything

• Get the recipient's requirements in writing. "We need a Medallion" is often a default answer from a call centre. Ask the transfer agent's international or overseas holder team specifically.
• Check the name on the account. It must match your current passport. If it does not — a maiden name, a missing middle name — the agent will also want evidence linking the two, and that is where a notary can genuinely help.
• Think about tax before you sell or transfer. A US tax form may also be needed, and the sale may have Australian tax consequences. Speak to a tax adviser.

Frequently asked questions

Can an Australian bank provide a Medallion guarantee? Only if it participates in one of the US programs. Most Australians report that their bank does not. Ask, but do not expect it.

Will a notarised signature and an apostille satisfy the transfer agent? Only if the agent says so. Some accept it as an alternative for overseas holders; some do not.

Is a Medallion guarantee the same as a "signature guarantee"? Some forms say "signature guarantee" without "Medallion". Ask whether a Medallion stamp is required or whether another form of guarantee will do.

Can the US Embassy provide one? The US Embassy in Australia's notarial page says it does not provide Medallion guarantees, and repeats the advice to contact the transfer agent.