The U.S. Coast Guard was and is responsible for maintaining certain records on U.S. merchant marine sailors and officers. I'm guessing that what you have is a form identified as DD Form 256 CG. Its title is "Honorable Discharge from the Armed Forces of the United States," specifically from the Coast Guard. It may have the further notation "Issued pursuant to P.L. 95-202 for service in the American Merchant Marine in oceangoing service during the period of armed conflict, December 7, 1941, to August 15, 1946."
At face value this form is somewhat misleading in that your father was never IN the Coast Guard, but the Coast Guard is the only governmental entity that would have, or be able to confirm, information that your father served in the U.S. merchant marine during World War II. (There is no single, official organization known as the U.S. merchant marine, which is collectively all the companies that own and operate civilian vessels and the officers and seamen employed by those companies.)
The use of this form arises from a 1988 decision on the part of the Department of Defense that certain U.S. merchant mariners, including your father, qualified as veterans for their service in World War II. Typically the form is used in conjunction with DD Form 214, also issued by the Coast Guard in the case of merchant mariners, to establish eligibility for veterans' benefits.
As you allude in your message, this sadly delayed recognition of their service has been a bitter issue among U.S. merchant mariners who served bravely in World War II.
To answer your question directly, the form is not only typical but common, at least among those World War II-era merchant mariners who, subsequent to the 1988 determination by the Department of Defense, pursued personal recognition as veterans and their eligibility for associated benefits.
Ron Carlson, Webmaster
Armed Guard / Merchant Marine website