All securities delivered by a customer or another broker dealer must be in good condition and must:

  • Be signed by all owners and all owners must be alive
  • Be in the correct denominations, i.e. number of shares or par value of bonds
  • Have all attachments
  • Be accompanied by a uniform delivery ticket

The owner of a security must endorse the certificate at the time of sale to ensure its negotiability or may sign a stock or bond power also known as a power of substitution.

The stock power, when attached to the certificate, will make it negotiable and includes an irrevocable power of attorney. All signatures must be accepted by the transfer agent. To ensure that the transfer agent accepts the signatures on certificates delivered by NYSE member firms, the NYSE started the Medallion Signature Guarantee Program, which allows NYSE members to stamp the certificates with a medallion rather than sign them. This stamp ensures that the transfer agent will accept the certificates for transfer and provides indemnification insurance for fraud. The Medallion Program members pay a fee to participate in this program.

Examples of invalid signatures are:

  • The signature of a minor
  • The signature of a deceased person
  • The signature of only one owner if jointly registered
  • A forged signature

 



Introduction

Related Articles
  1. Investing

    Are Banks Running Scared of Medallion Loans? (NYCB, TAXI)

    It's no secret that Medallion Financial (NASDAQ: TAXI) is one of the largest taxi medallion lenders in the country. Even with a growing consumer loan portfolio, medallion loans make up 46% of ...
  2. Investing

    Medallion Financial: NYC Loans Come Under Fire (TAXI)

    New York City was supposed to be the stronghold of the taxi industry. Yellow cabs are ubiquitous, an inexpensive and familiar way to traverse the concrete jungle.  Medallion Financial (NASDAQ: ...
  3. Investing

    Will Ride Sharing Crush Medallion Financial?

    Driving a taxi cab is far from a glamorous business, but in many areas of the country, it's a business that involves a lot of money.
  4. Investing

    3 Key Numbers From Medallion Financial's Earnings (TAXI)

    Medallion Financial (NASDAQ: TAXI) reported earnings on April 29, but it waited more than a week to file its quarterly report with the SEC. Now that we have the full financials in hand, here ...
  5. Investing

    Old Stock Certificates: Lost Treasure Or Wallpaper?

    What if you've discovered some old shares in bearer form? Follow our tips and find out what they're worth.
  6. Investing

    Is Medallion Financial's Dividend Safe? (TAXI)

    Medallion Financial (NASDAQ: TAXI) specializes in providing loans for taxicab medallions, but also underwrites small business loans. Recently, medallion values have been decreasing, which could ...
  7. Insights

    Signature Bank Expands Client Banking Teams (SBNY)

    New York-based Signature Bank enhanced its private client banking network with the addition of three veteran bankers.
  8. Investing

    The 4 Ways To Buy And Sell Securities

    Know the four main avenues of buying and selling investment instruments.
  9. Insights

    How NYC's Yellow Cab Works and Makes Money

    Owning a New York City cab can be a great low-risk investment if you can afford the cost of a medallion.
  10. Investing

    Old Stock Certificates: Lost Treasure?

    Today, most stocks reside electronically in a broker’s computer. But it is possible to stumble across a physical stock certificate.
Frequently Asked Questions
  1. Can I fund a Traditional IRA, a 403(b) or a Roth IRA using pension money?

    Can pension money be used to fund other retirement accounts?
  2. What are unregistered securities or stocks?

    Before securities, like stocks, bonds and notes, can be offered for sale to the public, they first must be registered with ...
  3. How does a company move from an OTC market to a major exchange?

    The over-the-counter market is not an actual exchange like the NYSE or Nasdaq. Instead, it is a network of companies that ...
  4. Can I roll a traditional IRA into a 529 college account for my grandchild?

    The short answer: Not without paying taxes. But as with much of the tax code, there are various nuisances and exemptions ...
Trading Center