Medallion signature guarantee is a legal requirement when transferring north American shares – and it doesn’t come cheap
I need to change my name on some IBM shares to my married name. For this I must get a medallion signature guarantee. I have not found any institution that will do this for less than £275. The shares are worth just over £500, so it hardly seems worth it. Why is getting a medallion signature guarantee so expensive? DE, Teddington, Middlesex
A medallion signature guarantee is a legal requirement when transferring north American funds or shares. It confirms that your identity and signature are genuine and limits the liability of the transfer agent against fraud.
Only US and Canadian financial institutions which belong to the Securities Transfer Agents Medallion Programme can issue medallion guarantees and the US embassy is aware of only two British companies authorised to obtain them: Title Research in London charges £260 and Lester Aldridge Solicitors in Edinburgh and Bournemouth charges £275. The cost reflects the time and expense of the four-to-six week process, Title Research says.
“We have to pay a fee to the issuing authorities in the US and Canada to obtain the guarantee,” says a spokesman. “We need to carry out identity and address checks on the asset holder and hard copy documents need to be securely mailed to north America and back.”
The fee is standard, regardless of the sum of the securities to be transferred. This means you are deprived of half of the value of your assets, but someone transferring $1m would barely notice the sting. If you hold an account with a north American bank contact them first, since some provide a medallion guarantee as part of their customer service.
Mark King is away.
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