Listen to a Business English Dialogue About Signature guarantee
Danielle: Hi Madelyn, do you know what a “signature guarantee” is in finance?
Madelyn: Yes, I do. A signature guarantee is a form of authentication provided by financial institutions to verify the identity of a person signing a financial document.
Danielle: That’s correct. When is a signature guarantee typically required?
Madelyn: A signature guarantee is usually required for high-value financial transactions, such as transferring securities or redeeming savings bonds, to prevent fraud and ensure the legitimacy of the signature.
Danielle: I see. How does a signature guarantee differ from a regular signature?
Madelyn: A signature guarantee is more secure than a regular signature because it involves a financial institution verifying the signer’s identity and assuming liability for the authenticity of the signature.
Danielle: That makes sense. Are there different levels of signature guarantees?
Madelyn: Yes, there are different levels of signature guarantees, ranging from medallion guarantees provided by banks and brokerage firms to notary publics or individuals authorized by the Securities and Exchange Commission.
Danielle: Got it. Why is a signature guarantee important for financial transactions?
Madelyn: A signature guarantee helps protect against fraudulent activities and ensures that only authorized individuals can conduct certain financial transactions, safeguarding the interests of both the parties involved and the financial institution.
Danielle: Thanks for explaining, Madelyn. A signature guarantee seems like an essential safeguard in financial transactions.
Madelyn: You’re welcome, Danielle. It’s an important measure to maintain trust and security in the financial system.