Warranty the Signature is Genuine

Only guarantee signatures of established clients. 

Ideally, you should try to direct the client to a certified associate who is personally familiar with the client (although this is not always possible).  A CCI client needing a medallion service is frequently introduced to the retail associate by a CCI Financial Advisor. In instances where the Financial Advisor is not present for the introduction, contact a CCI assistant for verification.  

• Always compare the signature on the endorsement with the signature card on file for the client. 
  • For loan clients, refer to loan documents to verify signature along with the proper identification. The signature of a CCI client cannot be verified to CCI records.

• Require proper identification 
  • Valid state drivers license with picture
  • Valid state identification card with picture 
  • Valid U.S. Passport with picture

• Insist on the appearance in person of every person whose signature you are guaranteeing. 
  • Never guarantee a signature at the request of a person other than the actual signer.

•  When asked to guarantee more than 1 signature on a certificate, never allow 1 owner to vouch for the signatures of the other owners.

Warranty that signer has legal Capacity to Sign 

Make sure there is no question that the person whose signature you are guaranteeing is of legal age (18 in most states) and competent. Practically speaking, you may not be able to determine whether a person has been adjudicated incompetent. Refuse to guarantee if you know that there has been a legal adjudication of incompetence or if you have serious doubts about the person's ability to understand.

Warranty that Signer Is an Appropriate Person to Endorse the Security 

• Ask to see the certificate itself so that you can determine the manner in which the certificate is registered. 
  • If the client tells you that there is no certificate (as would be the case with most mutual fund shares, dividend reinvestment shares, and book-entry securities), ask to see a copy of the most recent statement reflecting the registration of the security.

•  Do not guarantee a signature on a blank stock or bond power. 
  • The name of the issuer and the number of shares should be filled in on the power in order to provide some assurance that the stock or bond power on which the bank's guarantee appears will be attached to the certificate you have examined when it is sent in for transfer. 
  • The name of the transferee should appear to help you determine if there are any impermissible conflicts of interest (for example: a corporate officer who attempts to transfer a stock owned by the corporation to himself or herself).

• In cases where more than 1 name appears on a certificate, you should not guarantee the certificate unless all owners are physically present and sign in your presence.

• Joint Tenants. If you have received proof of the death of 1 or more of the registered owners (for example: a certified copy of a death certificate), it is appropriate to guarantee the signature(s) of the surviving owner(s) only if you are completely satisfied that the ownership of the security is in the form of:

  • Joint Tenancy with right of survivorship (the certificate should say JT TEN ')

  • Tenancy by the entirety (TEN ENT), in the case of certain husband-wife registrations for spouses residing in states that recognize tenancy by the entirety ownership

  • In the case of a security registered as a tenancy in common (TEN COM), only the personal representative of the deceased owner, acting in concert with the surviving tenant in common, can affect a transfer. Note: Refer to Decedent Section Transfer to see if it applies to your situation 

  • Life Tenant: Tenant. A life tenant is one who is entitled to the interest or dividends from a security for life, but is not entitled to sell the security without specific authorization. If the certificate reflects ownership by a life tenant (MARY DOE LIFE TEN UW (or UA) JOHN DOE), you may guarantee the signature of the life tenant as part of a transfer of the certificate only if you also receive either:

    • Certified copy of a will, trust agreement, or other instrument authorizing the transfer

    • A court order authorizing the transfer

    • Written consent by each remainder beneficiary identified in a certified copy of the governing instrument with signatures guaranteed.

• Signing as a Fiduciary The signature of an endorser in a fiduciary capacity (for example: trustee, personal representative, conservator) presents a multitude of potential issues:

  • Where the named registered owner is described as a trustee and endorses in that capacity, you may assume that the owner is still the trustee and you do not need to see a copy of the trust agreement.

  • In the case of a named registered owner described as a personal representative or conservator, you should ask to see a certified copy of Letters Testamentary or Letters of Conservatorship. If the appointment is more than 6 months old, ask for a current court-certified copy of the Letters.

  • Where the endorser signs either as personal representative or conservator, in place of the original registered owner who is either deceased, incompetent, or a minor (for example: A, personal representative of the estate of B endorses a certificate registered in the name of B), the Uniform Commercial Code establishes special requirements. 

  • You must obtain not only proof of the fiduciary's initial appointment (for example: Letters Testamentary for a personal representative, Letters of Conservator ship for a conservator), but also that the endorser is serving as fiduciary at the time of signing. You can rely upon a certificate of the court dated within 60 days before the date of presentment for signature guarantee. Note: Refer to Decedent Section Transfers to see if it applies to your situation.

  • Where the endorser signs as a successor to a named fiduciary who is registered as owner, you need proof that the endorser has succeeded the named fiduciary. With respect to a court-appointed fiduciary, such as a personal representative or conservator, this can be established by a copy of a court order, certified by the court within 60 days before the date of presentment for the signature guarantee, appointing the individual as successor to the original fiduciary. If the client's court papers are more than 60 days old, it is a simple matter for the client to have them re-certified by the court.

  • In the case of a successor trustee under a trust agreement, you will need to examine a current certified copy of the trust agreement to determine the procedure for succession upon the death, resignation, removal or disability of the original trustee. A certified copy is a photocopy that contains a typewritten legend, signed by the Trustee, by another financial institution, or by a notary public stating that the copy is a true and correct copy of the original Trust Agreement. You must verify compliance with the required Trustee succession procedure and, depending upon the circumstances, request a certified copy of a death certificate, written letter of resignation, written evidence of removal, or written evidence of the disability of the initial trustee (such as a doctor's letter). You should also ask a successor trustee to sign a Certificate of Trustee, in which such individual swears that he or she has succeeded the initial trustee pursuant to the procedures established in the trust agreement.

  • Special care should be exercised when a security is registered in the names of several individuals as fiduciaries, (for example: A, B and C as Trustees under Trust Agreement dated xx/xx/xxxx). Problems can arise if less than all the named fiduciary owners sign. You will need to review the Trust Agreement to determine if less than all of the Trustees can bind the Trust. If so, then you should require that the appropriate number of Trustees sign the stock power in your presence. In this situation, you may need to consult with SupportU for instruction.

  • In the case of a security registered under the Uniform Transfers to Minors Act ("UNIF TRANS MIN ACT" or "UTMA") or the Uniform Gifts to Minors Act ("UNIF GIF MIN ACT" or "UGMA"), the signature of the individual registered as custodian can be guaranteed if you determine that his or her signature is genuine. You should not guarantee the signature of an individual purporting to be a successor to the named custodian unless conclusive evidence of the power of such person to act as successor custodian (such as a properly executed written designation by the retiring custodian or a certified copy of a court appointment) is offered. In most cases, you will need to consult with SupportU before guaranteeing the signature of a successor custodian.

• Powers of Attorney (POA): You will sometimes be asked to guarantee the signature of an individual who is endorsing a security as attorney-in-fact for the registered owner pursuant to a Power of Attorney. Before guaranteeing a signature under a Power of Attorney, do the following:

  • Review the POA to make sure it is a valid Durable Power of Attorney under state law.

  • Determine whether the POA gives the attorney-in-fact the authority to transfer or sell securities.

  • If the attorney-in-fact wants to transfer securities to themselves, the POA must expressly permit the attorney-in-fact to be the recipient of gifts

  • If you cannot answer these questions yourself, you will need to contact SupportU. If the POA is acceptable, you will need to have the attorney-in-fact sign the bank's standard Durable Power of Attorney Affidavit. By signing this affidavit, the attorney-in-fact swears that the principal was competent at the time the Power of Attorney was executed, the POA has not been revoked by the principal's death or otherwise, and that the copy attached to the affidavit is a true and correct copy of the Power of Attorney and has not been rescinded. Never guarantee a signature under a Power of Attorney if you know that the principal is deceased.

  • Note: The only exception to the durability requirement is the Specific Power of Attorney for Multiple Security Owners form referenced above.

• Corporations Where securities are registered in the name of a corporation, the officer signing on behalf of the corporation must furnish you a certified copy of resolutions of the board of directors authorizing the endorsement of securities by designated officers. 

  • The corporate secretary's certificate should be under the corporate seal (unless the corporation has no seal), state that the copy of the resolution is true and correct and remains in full force and effect, and be dated within 6 months prior to the date of presentment for guarantee.

  • The resolutions should be accompanied by a certificate of incumbency (under similar seal and signed by an officer other than the officer endorsing the certificate within 6 months prior to the presentment for guarantee), on which the signatures of all officers authorized to endorse will appear. In the event the stock power or back of the certificate indicates that a security registered in the name of the corporation is to be transferred to the individual who is endorsing on behalf of the corporation, you should ask for a certificate by a corporate officer other than the transferee containing a board resolution specifically authorizing the transfer. 

  • Finally, in the case of a transfer by a sole officer of a corporation, ask for a certificate signed by a majority of the board of directors (rather than by the corporate secretary); if there is more than 1 director.

• Partnerships. The endorsement of a general partner binds the partnership unless the partner endorsing the certificate has no authority to do so and for some reason you know that he or she has no such authority.          

  • In most situations, you will be able to determine the authority of the partner by reviewing a current certified copy of the partnership agreement (for example:  photocopy containing a typewritten legend signed by a partner, another financial institution, or a notary public stating that the copy is a true and correct copy of the original). 

  • If there has been any change in the identity of the partners, you will need additional documentation, such as notices of resignation, succession or addition of partners. A general partner on behalf of the partnership must sign these notices. 

  • A written statement can often resolve any further doubts about the partnership status of the endorser that the endorsing partner is a member of the partnership, signed by any general partner other than the one endorsing the security. 

  • If the stock power or back of the certificate indicates that the security is to be transferred to the individual partner who is endorsing on behalf of the partnership, you should require a certificate executed by all the general partners specifically authorizing the transfer. 

  • Securities registered in the name of a partnership should be endorsed with the name of the partnership along with the signature of the endorsing partner, (for example: Smith & Sons, by Sam Smith, General Partner).

• Limited Liability Company. In the case of securities registered in the name of a Limited Liability Company (LLC) you need to review a current certified copy of the Operating Agreement for the LLC.

  • This document sets forth the rules by which the members of the LLC have decided to conduct business, including whether the LLC is to be managed by its members or manager(s).

  •  A stock power must be signed either by the manager(s), in the case of LLCs managed by manager(s), or by the members, in the case of LLCs managed by members.

• Unincorporated Associations. Endorsements of individuals purporting to act on behalf of unincorporated associations (such as investment clubs, labor unions, and certain religious and educational institutions) are considered on a case-by-case basis and often require a review of substantiating documentation by SupportU/Compliance.

• Prohibited Guarantees. Occasionally, you may be asked to guarantee an endorsement (with respect to a certificated security) or to provide either a special signature guarantee or guarantee and instruction (with respect to an uncertificated security), such as the following: “Endorsement Guaranteed” (note that this is not the same thing as an endorsement guarantee on a check), “Signature(s) Specially Guaranteed” or “Instruction Guaranteed”. 

  • Under the UCC, an issuer may not require any of these guarantees, and an officer should never execute any of these guarantees. Each of these guarantees extends warranties far beyond the usual signature guarantee warranties and should therefore be avoided.

Medallion Signature Guarantee Control Log

A Medallion Signature Guarantee Control Log is to be completed for each Medallion Signature Guarantee request. All information is to be completed and the signature of the endorser(s) is required.

Image the Medallion Signature Guarantee Control Log, copies of the document(s) that has been signature guaranteed, and all supporting documentation to the clients CIF record following the Document Imaging Procedures.

CCI Client with no Deposit/Loan Relationship

In order retain copies of documentation provided at the time a Medallion Signature Guarantees is performed for a Capital City Investments (CCI) client with no deposit or loan relationship, an associate will be required to build a Client Identification File (CIF).

These clients are to be identified as a non-reporting individual when building the CIF record and do not require capturing of a Social Security Number. At minimum the CIF requires Name, Physical Address, DOB and occupation to meet Capital City Bank Client Identification Program requirements.

Trust Company Document Retention Requirements

Capital City Trust Company is responsible for its own documentation and retention requirements.

Qualified Signature Guarantee

A signature guarantee may not be qualified in any way. This means that you should not append a date or any other terms of limitation or explanation next to the medallion Stamp.

Guaranteeing Other Documents

Capital City Bank does not use a Medallion Signature Guarantee stamp for the purpose of guaranteeing that a Power of Attorney or Trust agreement is in full force and effect. Clients may also request that you signature guarantee documents that are not related to securities transfers.

All such requests should be denied.

Guaranteeing Item Endorsed by Means of a Mark

If you are asked to guarantee a stock power by a client who is unable to write his or her name, the client should endorse by means of a mark (“X”), accompanied by the signatures and addresses of 2 witnesses (neither of whom is the transferee of the security), and a written statement by the witnesses that “the transfer instrument was read to the transferor in our presence, that he or she made his or her mark in our presence and that he or she signified an intention thereby to transfer the security.” All such requests should be referred to SupportU.

SEC Regulations

SEC Regulations impose special requirements whenever securities (worth more than $10,000) come into the possession of a broker-dealer or bank from someone other than the registered owner. Whenever this situation arises, the broker-dealer or bank is required to make inquiry with the Securities Information Center, Inc., a central database designated by the SEC, whether the security has been reported missing, lost, stolen or counterfeit. There are additional reporting requirements if the security is actually confirmed as being missing, lost, stolen or counterfeit

Certification Process

All associates wishing to utilize a medallion stamp must be certified. Certification can be obtained through the completion of training modules on the website of the Medallion Stamp Program Administrator, Kemark Financial Services. For instructions on how to obtain certification, please contact _SupportU.

Stamp Issuance

The bank is a member of the Securities Transfer Association Medallion Program (STAMP), and our signature guarantees are provided by appending the Medallion Stamp to the stock power or the back of the certificate. 

All Medallion Stamps are ordered through SupportU. SupportU keeps a record of Medallion Stamps by stamp number and by location. Do not attempt to purchase 1 through an outside vendor. The transfer agent rejects any signature guarantee stamp other than a bank-issued Medallion Stamp.

Stamp Locations

As a convenience to our clients, the bank will keep 1 Medallion Stamp in each office. In certain situations, an office may have additional stamps, but no more than 3 are allowed. More than 1 associate can be assigned to a stamp and having multiple certified users per stamp is preferable to having multiple stamps in an office to reduce the bank’s liability exposure.

Stamp Ink Requirements

If your stamp runs out of ink, you must order additional replacement pads (with green security ink) through SupportU. 

DO NOT TRY TO RE-INK THE STAMP PAD WITH REGULAR GREEN INK. 

The transfer agent will rejects medallion guarantees that are not done with green security ink.

Stamp Safekeeping

The importance of proper safeguards and security procedures for the bank's Medallion Stamps cannot be overemphasized. 

Medallion Stamps must be thought of in security procedures as equal to or as important as cash. If the stamp were to fall into the wrong hands, it could be used to perpetrate a fraud and the bank would be liable. For this reason, only certified officers and Client Experience Managers should have access to Medallion Stamps and they MUST be kept in a secure locked location when not in use.

Lost or Stolen Stamps

In the event the medallion stamp is lost or stolen, email _SupportU immediately.

When do I use the Medallion Guarantee Stamp?

A Medallion Guarantee is used only in situations involving the sale or transfer of securities.

What is a security?

Securities are shares, participations, or other interests in the property of an enterprise of an issuer. A Security is represented by an instrument which is in “Book Entry” or certificated form and is issued in the name(s) of a person(s) entitled to the Security or to certain rights represented by the Security. Examples include, but not limited to, stocks, bonds, and mutual funds.

On what documents can the Medallion Guarantee be used?

The Medallion Guarantee Stamp should only be used to guarantee an endorsement that authorizes the sale, assignment, transfer or redemption of a security. Examples include, but are not limited to the following: Mutual Fund Liquidation request, Transfer or Sale of shares of stock.

• Note: Any registration change (for example: name or initials) is considered a change in ownership and the Medallion Guarantee Stamp can be used.

Are U.S. Savings Bonds considered securities?

Yes, government debt obligations of various types (e.g. savings bonds) are considered securities. US Savings Bonds do not require a signature guarantee to be redeemed. Clients are to be referred to www.treasurydirect.gov for situations where bonds require reissuance or replacement.

What are some examples of documents the Medallion Guarantee Stamp SHOULD NOT be used on?

401K Enrollment Forms, Term Life Insurance Policies, Tax Returns, Mortgage or Car Loan documents, and CD redemptions are examples of documents that SHOULD NOT be guaranteed using the Medallion Stamp. If a client requests one of these documents to be stamped, the request should be denied politely.

Should I keep copies of the items I guarantee?

Yes. You should complete the “Guarantor Control Log” for each transaction guaranteed. In addition, copies of the documentation guaranteed should be maintained with the log.

Can multiple medallion stamps be used to increase the limit of the guarantee?

No. If the value of the guarantee exceeds the stamp limit, the client must be referred to an officer with a higher stamp limit. Contact SupportU for guidance.

Are the Medallion Guarantee program and the Signature Verification program the same?

No. Capital City Bank is only a member of the Medallion Guarantee program. Do not use a Medallion Guarantee on a document requiring a Signature Verification. Signature Verifications are required on the transfer of some savings type plans such as a 529 plan.