What Is the FCA?
The Financial Conduct Authority (FCA) is the independent regulatory body responsible for overseeing financial services firms in the United Kingdom. It was established in 2013 and regulates over 50,000 firms and 100,000 financial services professionals.
The FCA has three primary objectives: protecting consumers, ensuring market integrity, and promoting competition. It has the power to fine firms, withdraw authorisations, and pursue criminal prosecutions.
What Does FCA Regulation Mean for Brokers?
When a broker is FCA-regulated, it must comply with strict rules designed to protect consumers:
Client fund segregation: Your money must be held in segregated accounts, separate from the broker''s own funds. If the broker goes bankrupt, your money is ring-fenced.
Negative balance protection: For retail clients trading CFDs and forex, you cannot lose more than your deposited amount.
Risk warnings: Brokers must prominently display the percentage of retail clients who lose money.
Leverage caps: The FCA limits leverage to 30:1 for major forex pairs, 20:1 for minor pairs, 2:1 for cryptocurrency CFDs, and 5:1 for individual shares.
Best execution: Brokers must execute your trades at the best available price.
How to Check if a Broker Is FCA Regulated
1. Visit the FCA register at register.fca.org.uk.
2. Search for the firm by name or FCA reference number (FRN).
3. Check the firm''s status — it should say "Authorised" or "Registered".
4. Verify the specific permissions — ensure the firm is authorised for the activities it offers.
5. Cross-check the website, phone number, and address shown on the register against the broker''s website.
Warning: Some scam firms "clone" legitimate FCA-registered companies, using their name and FRN but with different contact details. Always verify contact information matches exactly.
What Protection Do You Get?
If an FCA-regulated firm fails, the Financial Services Compensation Scheme (FSCS) protects up to £85,000 per person. You can also escalate complaints to the Financial Ombudsman Service if you cannot resolve issues directly with the firm.
These protections do not exist with unregulated or offshore brokers.
FCA Warning List
The FCA maintains a public warning list of firms it believes are operating without proper authorisation. You can check this list at fca.org.uk/consumers/warning-list. If a firm appears here, do not send them any money.
Risk Disclosure: Trading and investing carries significant risk. Your investments can fall as well as rise. CFDs carry high risk of rapid loss due to leverage. This is information only, not financial advice. Seek independent advice before investing.
Frequently Asked Questions
Does FCA regulation guarantee I won''t lose money?
No. FCA regulation protects you from firm misconduct and insolvency, not from market losses. Your investments can still fall in value. Regulation ensures fair treatment, not profitable outcomes.
Are all UK brokers FCA regulated?
Not necessarily. Some firms operating online may be based offshore and not regulated by the FCA. Always verify before depositing funds. Firms offering services to UK consumers without FCA authorisation may be operating illegally.
What happens if my FCA-regulated broker goes bust?
Your funds should be protected through client fund segregation. Additionally, the FSCS covers up to £85,000 per person if the firm cannot return your money. Claims can be made at fscs.org.uk.
Is FCA registration the same as FCA authorisation?
No. "Registered" firms (like crypto exchanges) meet anti-money-laundering requirements but have fewer consumer protections. "Authorised" firms meet full regulatory standards. Check the specific permissions on the FCA register.
Can I trust a broker regulated by another country''s regulator?
Other reputable regulators include ASIC (Australia), CySEC (Cyprus/EU), and MAS (Singapore). However, UK-based protections like FSCS only apply to FCA-authorised firms. Offshore regulation may offer weaker consumer protection.
How do I report an unregulated broker?
Report suspicious firms to the FCA at fca.org.uk/consumers/report-scam-unauthorised-firm and to Action Fraud at actionfraud.police.uk. If you have lost money, contact your bank immediately to explore chargeback options.
