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Have a question? +1 815-826-6324 (815-8-BondAI) phil@AmericasSuretyBonds.com
Army Veteran Owned | Expert Surety Bonds Since 2004
A financial institution cannot issue STAMP medallion signature guarantees until its surety bond coverage is in place. This bond is that coverage. It stands behind every medallion your staff stamps, which is exactly why transfer agents accept a STAMP guarantee without second guessing it.
The Securities Transfer Agents Medallion Program (STAMP) is administered by Kemark Financial Services, Inc. Every institution that joins as a Guarantor must acquire the STAMP medallion imprinting equipment and obtain surety bond coverage before it can guarantee signatures on securities transfers. This is a program requirement, not a New York state license bond, and the required coverage amount and bond form should be confirmed with Kemark before the bond is issued.
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When a shareholder sells or transfers certificated securities, the transfer agent needs assurance that the signature on the stock power is genuine. SEC Rule 17Ad-15 requires every transfer agent to keep written standards for accepting signature guarantees from eligible guarantor institutions, and it lets a transfer agent meet that obligation by accepting guarantees from members of an established signature guarantee program. STAMP is one of three such programs named by the SEC, alongside the Stock Exchanges Medallion Program (SEMP) and the New York Stock Exchange Medallion Signature Program (MSP). The SEC describes STAMP as having more than 7,000 U.S. and Canadian participating financial institutions.
The principal is the Guarantor institution. Rule 17Ad-15 defines eligible guarantor institutions to include banks, brokers and dealers, municipal securities dealers, credit unions, national securities exchanges, registered securities associations, clearing agencies and savings associations. Commercial banks, savings banks, credit unions and broker dealers are the institutions most often offering medallion guarantees to the public.
According to the Securities Transfer Association, a Guarantor joining STAMP must acquire the STAMP medallion imprinting equipment and obtain surety bond coverage. Enrollment runs through Kemark Financial Services, Inc., the program administrator, at (845) 620-9300.
STAMP also requires certification training for Guarantor personnel. The curriculum covers UCC Section 8-306, proper and improper use of the medallion stamp, the details of the STAMP surety bond, signature guarantee best practices, and control and safeguarding of the imprinting equipment. Completing that training is a separate requirement. It does not stand in for the surety bond, and an institution needs both before its staff start stamping.
A medallion guarantee is a warranty that the signature is genuine and that the signer had authority to make the transfer. If a guaranteed signature turns out to be forged or unauthorized and a transfer agent or investor suffers a loss, the bond is the financial backing behind that warranty. The protection is for the parties who relied on the stamp, not for the Guarantor institution itself.
The program does not publish a single bond amount online. Confirm the required coverage amount and the current bond form with Kemark before the bond is issued. The premium is priced by the surety based on the coverage amount and an underwriting review of the institution, including its financial condition and its controls over the medallion stamp. The Securities Transfer Association notes that in many cases the coverage can be obtained at nominal cost from the Guarantor's existing insurance carrier.
No. STAMP is a signature guarantee program recognized under SEC Rule 17Ad-15 and administered by Kemark Financial Services, Inc. The bond is a condition of program membership, and it is filed according to Kemark's instructions rather than with a state licensing agency.
Any financial institution joining STAMP as a Guarantor. That typically means banks, savings associations, credit unions and broker dealers that want to offer medallion signature guarantees to customers transferring securities.
No. The Securities Transfer Association lists certification training and surety bond coverage as separate requirements. The training covers the STAMP surety bond itself, among other topics, but it does not replace it.
The required coverage amount is not published online. Confirm it with Kemark Financial Services at (845) 620-9300 when you enroll, and have the bond written to that figure.
The surety prices the bond from the coverage amount and its review of your institution, including financial strength and how the medallion stamp is controlled. The Securities Transfer Association notes that many Guarantors obtain the coverage at nominal cost.
A medallion guarantee warrants that the signature is genuine and authorized. If it is not and someone relying on it suffers a loss, a claim can be made against the bond. The surety pays valid claims and then looks to the Guarantor institution for repayment.
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