Medallion Signature Guarantee vs Notary Public Stamp

Signature guarantees and notary stamps are both used to verify signers’ identity. Loan documents, for instance, require professional notarization to protect against fraud. The notary public verifies the signer’s identify – usually done by checking his or her driver’s license of state-issued ID card – and stamps the document to finalize its execution. While a signature guarantee shares some similarities to a notary stamp, they are two unique processes, each with its own purpose.

Notary and Signature Guarantee Documents

The most distinguishable difference between a notary stamp and signature guarantee is the document type in which they used. A signature guarantee (also known as a medallion guarantee) is intended specifically for documents involving the transfer of money and “securities” through banks and other financial institutions. In essence, it is a guarantee by the original bank or financial institution that the signature is authentic and valid. If the signer forged his or her identity, and the document was still given a signature guarantee, the financial institution is liable for any losses.

A notary stamp, on the other hand, is used to verify the signer’s identify on a variety of legal documents, including contracts, wills, power of attorney, wills, testimonies, and loan agreements. Notaries are commission and regulated differently from state to state; therefore, it’s important for anyone seeking notarial services to educate themselves on their respective state’s laws governing the notarial acts.

Who Can Place a Notary Stamp or Signature Guarantee on a Document?

Only a notary public who’s been commissioned by his or her state is legally allowed to place a notary stamp on a document. The notary public must ensure the signer is who they say they are.

Signature Guarantees are not performed by state-appointed notary publics. Instead, they are performed by banks, credit unions and other financial institutions. The bank employee verifies the signer’s identity and places the signature guarantee on the document. Signature Guarantees are performed by members of one of the three following institutions: The Securities Transfer Agents Medallion Program, Stock Exchanges Medallion Program and New York Stock Exchange Medallion Signature Program.

The cost of both notarial services and signature guarantees is typically placed on the signer.

The Stamp / Signature

In the past, most notary stamps features an embossed seal that was applied to the document; however, states are eliminating this method and replacing it with traditional black-ink stamps. Black-ink stamps are easier to use, more reliable, and cost less than embossed seals.

A signature guarantee is done using a special green-ink stamp that cannot be easily forged or reproduced. Once the stamp is applied, the bank employee signs his or her name on it. Signature guarantees typically have a barcode for an additional layer of security and fraud protection.

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