How to Verify a Trading Broker's Regulation on the Regulator's Register
Choosing a forex broker begins with one simple question: is the company actually regulated where it says it is? A licence number on a website is a claim, not evidence. The following guide explains how to verify that claim on the regulator's own register before you deposit any money, and what to look for once you locate the entry.
Why Check the Regulation Before Anything Else
A licence from a strong regulator may give real protection, such as client money held separately and, in some jurisdictions, a compensation scheme. However, licences can change: firms are sold, rebranded, sanctioned or lose their authorisation. Some companies only hold an offshore company registration, which is not a forex licence at all.
What Safeguards a Strong Licence Usually Provides
Rules differ by country, but major regulators generally require brokers to keep client money in separate bank accounts, hold a minimum amount of capital, report to the regulator and follow conduct rules on marketing and leverage. In the UK, eligible clients of a failed firm may be covered by the Financial Services Compensation Scheme. In the European Union, investor compensation funds provide a smaller level of cover. Many offshore jurisdictions offer none of this, which is why the same brand can give very different protection depending on which of its companies opens your account.
Companies Covered on FXSharp
The brokers and platforms below have an editorial review on FXSharp. Most hold licences from major regulators, but several also serve clients through offshore entities with lighter protection. Check which company would really open your account, and read the review before depositing.
- Pepperstone
- copyright
- Interactive Brokers
- Saxo Bank
- Charles Schwab
- Webull
- Admirals
- Axi
- Libertex
- RoboForex
- InstaForex
- PU Prime
- StoneX
- Mitrade
- ADSS
- TD365
- Spreadex
- ProRealTime
- GKFX
- AMP Global
How to Check a Licence on Your Own
Find the exact company name and licence number in the footer of the broker's site or in its client agreement. Next, go to the regulator's site yourself, not through a link from the broker, and search its public register. Search by company name as FXSharp well as by number, because some registers do not show licence numbers at all. Match the company name, licence status, licence type and, if listed, the approved website address.
Red Flags to Watch For
Be wary if the register shows a look-alike but different company name, a licence marked as revoked, suspended or surrendered, or a website address that is not the one you are using. Fraudsters often copy the name and licence number of a real company, so look at the regulator's warning list for clone firms as well. Pressure to deposit quickly, promises of guaranteed returns and requests to pay through unusual channels are further warning signs, whatever the website claims about regulation.
Check Once More Over Time
A licence that was active when you opened an account may not stay that way. Brokers merge, sell their client books, move clients to another entity or lose their authorisation. Looking at the register again before a large deposit or a withdrawal costs nothing, and supervisors often publish announcements when a firm's status changes.
Overall, a few minutes on the regulator's register can spare you from a costly mistake. Trading in forex and CFDs carries a high risk of losing money, and verify before you invest.