Futures, CFDs and spread bets are high risk; most retail traders lose money. Education only, not advice. Risk warning

Good Trading Guide

How to Check a Firm Is FCA Authorised (and Spot Clone Firms)

Module 2: Brokers, Accounts and Platforms (UK) · Lesson 2 of 11 · Back to course

Almost every firm offering spread bets, CFDs or share dealing to people in the UK must be authorised by the Financial Conduct Authority (FCA). Checking takes about five minutes, it’s free, and it’s the single best defence against the most common trading scams. Do it before you open any account – demo or live – and before you send anyone money.

Why it matters

Dealing with an FCA-authorised firm means:

  • The firm must follow FCA rules, including the retail leverage limits, negative balance protection and standard risk warnings.
  • It must keep retail client money separate from its own money.
  • You can usually complain to the Financial Ombudsman Service (FOS) if the firm doesn’t resolve a complaint.
  • You may be able to claim from the Financial Services Compensation Scheme (FSCS) if the firm fails and owes you money (see Lesson 2.4).

If you deal with an unauthorised firm, you’re very unlikely to have any of these protections.

Step by step: checking a firm

Step 1: Go to the FCA’s own site – by typing the address. Use the FCA Firm Checker or the Financial Services Register. Don’t click links in emails, adverts or the firm’s own website: scammers create fake look-alike pages.

Step 2: Search for the firm’s name (or its Firm Reference Number, the FRN). Check the exact legal name. Many brands are trading names of a company with a different name.

Step 3: Check the status. You want to see that the firm is authorised – not “no longer authorised”, and not just an unrelated company with a similar name.

Step 4: Check the permissions. Authorisation covers specific activities. A firm authorised only for, say, insurance broking or consumer credit isn’t allowed to offer you CFDs. Look for permissions relating to dealing in investments, arranging deals and holding client money.

Step 5: Check the contact details match. Compare the website address, phone number and email on the register with the ones you’ve been given. This is the step that catches clone firms. If they don’t match, or the register lists no contact details, or the firm says the register is “out of date”, call the FCA on 0800 111 6768.

Step 6: Search the FCA Warning List. It lists firms the FCA knows are operating without permission, including many clones. Remember: a firm not being on the Warning List doesn’t mean it’s safe. Scammers change names all the time.

Step 7: Contact the firm using the register details. Phone or email using the contact details from the register – not those from an advert, message or caller.

What is a clone firm?

A clone firm is a scam that pretends to be a genuine, authorised firm. Fraudsters copy the real firm’s name, FRN and address – sometimes even its website design – but give you their own phone number, email or web address. If you only check that the name appears on the register, you’ll be fooled.

Common signs:

  • Small differences in the web address (an extra letter, a different ending such as .com instead of .co.uk).
  • Email addresses from free providers (Gmail, Outlook) or slightly misspelt domains.
  • They contacted you first, by phone, social media or messaging app.
  • They claim the register details are out of date.
  • They ask you to pay into a personal bank account, a crypto wallet, or an account in a different name.

A note on overseas firms

Some firms based abroad aren’t authorised in the UK at all, and some advertise to UK residents anyway. If you trade with them, you generally won’t get UK protections such as FOS or FSCS. Since the UK left the EU, EU-authorised firms no longer automatically have permission to serve UK clients. Check the FCA register either way.

Example: a near miss (illustrative)

This example is made up for teaching purposes.

Jas from Leicester gets a message on social media from “an account manager at a major UK broker”, offering a free strategy session. The name checks out on the FCA register – it’s a real, authorised firm. But the website Jas is sent to ends in .co instead of .co.uk, and the phone number doesn’t match the register. Jas calls the number listed on the register instead. The genuine firm confirms it has no such employee and doesn’t contact people through social media. Jas reports the account. Five minutes of checking saved a deposit of £2,000.

What about prop firms?

Most prop firms that sell challenges aren’t authorised by the FCA, because they argue that evaluations on simulated accounts aren’t regulated investment business. That means you generally won’t find them on the register, and the protections above usually won’t apply to fees you pay them. We look at this in detail later in the course, in the prop challenge stage.

Key takeaways

  • Always check a firm on the FCA Firm Checker or Register, typing the address yourself.
  • Check status and permissions, not just the name.
  • Make sure the contact details match the register – that’s how you catch clone firms.
  • Not being on the Warning List doesn’t mean a firm is safe.
  • If in doubt, call the FCA on 0800 111 6768.

Quick quiz

  1. What’s a clone firm? (A scam pretending to be a real authorised firm, using its name and details but different contact details.)
  2. Why should you type the FCA’s web address yourself? (Links in emails or adverts may go to fake look-alike sites.)
  3. A firm’s name is on the register. Is that enough? (No. Check its status, permissions and contact details.)
  4. A firm isn’t on the FCA Warning List. Does that prove it’s safe? (No.)
  5. What’s the FCA consumer helpline number? (0800 111 6768.)

Key terms

FCA · FCA Register · Clone firm · FSCS · FOS · Negative balance protection · Retail client

Try this

Pick any two well-known UK trading providers. For each, find on the FCA register: the legal company name, the FRN, the status, one relevant permission, and the listed website and phone number. Then visit each provider’s website (by typing the address) and check that the details in its footer match. Save your notes – you’ll use the same checklist for any firm you consider in future.

FAQ

What’s an FRN? The Firm Reference Number – a unique number the FCA gives each authorised firm. Genuine firms usually show it in their website footer. Clone firms often copy it, so always check the contact details too.

What should I do if I think I’ve been scammed? Contact your bank straight away. Report it to the FCA on 0800 111 6768 and to Report Fraud on 0300 123 2040 (England, Wales and Northern Ireland) or Police Scotland on 101. See Trading scams to avoid.

Does FCA authorisation mean a firm is a good choice? No. It means the firm is allowed to do the business and must follow FCA rules. It doesn’t mean its costs are low or that trading with it will be profitable.

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Disclaimer: This page is general education, not financial or investment advice or a personal recommendation, and it doesn’t take your circumstances into account. Examples are hypothetical, for illustration only, and not an invitation to buy or sell. Learning a strategy doesn’t guarantee profits. Past performance is not a reliable guide to future results. Futures, spread bets and CFDs are complex and carry a high risk of losing money quickly because of leverage, and most retail traders lose money. With a real futures account, losses can exceed your deposit. Only trade with money you can afford to lose, and speak to an independent FCA-authorised adviser if you’re unsure. Read our full risk warning.