How to Check a Trading Broker's Licence on the Official Register
How to Check a Trading Broker's Licence on the Official Register
Blog Article
Choosing a forex broker begins with one basic question: is the company actually regulated where it says it is? A licence number on a broker's site is a claim, not proof. This article explains how to check that claim on the regulator's own register before you send any money, and what to look for once you locate the entry.
Reasons to Verify the Regulation First
A licence from a major regulator can give meaningful safeguards, such as client money held separately and, in some jurisdictions, a compensation scheme. However, licences can change: companies are sold, rebranded, sanctioned or lose their licence. Other companies only hold an offshore company registration, which is not financial supervision at all.
What Safeguards a Strong Licence Typically Provides
Requirements differ by country, but leading regulators usually 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 offer a lower level of cover. Many offshore jurisdictions offer none of this, which is why the same brand can offer very different protection depending on which of its companies opens your account.
Companies Reviewed on FXSharp
The companies below have an independent review on FXSharp. Many hold licences from recognised regulators, while several also onboard clients through offshore entities with lighter protection. Check which company would really open your account, and read the review before opening an account.
- 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 Broker on Your Own
Look up the full company name and licence number in the footer of the broker's site or in the full review its client agreement. Next, go to the regulator's website directly, not through a link from the broker, and search its public register. Search by company name as well as by number, because some registers do not show licence numbers at all. Compare the company name, licence status, licence type and, if listed, the approved website address.
Red Flags to Look Out For
Be careful 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 genuine company, so look at the regulator's warning list for clone firms too. Pressure to deposit quickly, promises of guaranteed returns and requests to pay through unusual channels are further red flags, 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. Checking the register again before a large deposit or a withdrawal costs nothing, and regulators often publish announcements when a firm's status changes.
In short, a few minutes on the register can save you from serious losses. Leveraged trading in forex and CFDs carries a high risk of losing money, and check first, then you invest.
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