About FCA – UK Regulated Brokers
The FCA stands for the “Financial Conduct Authority“, representing an important independent financial regulatory body in the United Kingdom. It is based in London, UK and its main responsibility is to regulate and examine the operation of financial institutions incl. forex brokers in the UK.
With that in mind, the main aim of the FCA is to ensure that the code of conduct is fair and that all the firms in the UK operate accordingly. It is considered to be one of the most serious regulators not only in Europe but also in the World.
In case your FCA UK regulated forex broker goes bancrupt, you shouldn’t worry about your money since there is a compensation scheme in place called FSCS Financial Services Compensation Scheme that protects retail clients up to £50,000. You can file a claim to FSCS and in case your request is successful you will be compensated up to the limit that applies.
List of Brokers Regulated by FCA (Updated in June)
|FCA Regulated Broker's Name||Trader's Rating||FCA reference nbr.||Minimum deposit||Trading Platform||Max. Leverage||Our Review|
66% of CFD retail accounts lose money.
|Ref.nbr: 583263 (eToro (UK) Ltd||$200||CopyTrader™|
|1:30||Review of eToro|
|Ref.nbr: 684312 (Pepperstone Limited)||$100||cTrader||1:30|
|Ref.nbr: 705428 (Trading Point of Financial Instruments UK Limited)||$5||MetaTrader 4|
|1:30||Review of XM broker|
|Ref.nbr: 801701 (HF Markets (UK) Limited)||$50||MetaTrader 4||1:30||Review of HotForex|
|Ref.nbr: 682782 (HYCM Europe Ltd.)||$1000||MetaTrader 4||1:30|
|Ref.nbr: 504072 (AVA Trade EU Limited)||$100||MetaTrader 4||1:30||Review of AvaTrade|
Check if the forex company is FCA authorised
Are you in doubt whether the fx brokerage you want to sign up with is FCA authorised or not ?
Here is the way to check it easily:
- First of all, head to their website: https://register.fca.org.uk/
- Type your brokerage name into “SEARCH by company, person product” field
- In case you cannot find anything, check broker’s website as many of them have a business name that is different to their name on the website. For example famous XM broker is registred under their business name is Trading Point of Financial Instruments Ltd.
- Didn’t find anything ? You might have been scammed. Just contact the FCA (see below details)
- Also beware of the “clone companies” that are a big problem nowadays and clear sign of a forex scam.
How to Contact the FCA in UK
Do you want to file a complaint or are you being scammed? You can contact the FCA by calling them from Monday until Friday 8AM to 6PM via 0800 111 6768 (freephone) or 0300 500 8082 from the UK, or +44 207 066 1000 from abroad.
Understanding How the FCA Operates
It’s critical to note that the FCA is entitled to revoke licenses if the situation asks for it, as well as oversee the materials created for marketing and promotional purposes, to ensure their legitimacy. In addition to that, the FCA is involved in auditing company financials. This is essential in order to establish the reliability index of each company. This way, consumers can be confident that they get a decent deal whenever they collaborate with financial companies.
So, when it comes to the firms that work under the FCA, the obvious conclusion is that these firms are legitimate, and they address the needs of the client, not the other way around.
With that in mind, you might wonder whether the same high standards apply in the regulation of Forex brokers. Yes, according to the law, all the trading brokerage houses that function in the UK must get a license from the FCA.
Aside from this, the FCA must provide them a regulation. This is primarily why one might think that the FCA regulated Forex firms are reliable. The code of conduct entails a wide range of specifications the brokers must abide by. The code of conduct is the result of the prescription by the Financial Services Act of 2012.
When the situation asks of it, the FCA will resort to these laws, in order to protect the rights of the consumer.
Does the FCA Work for the Benefit of the Traders?
Essentially, the FCA actually oversees the way in which financial companies work with their customers. Hence, it could be said that the FCA actually works in the benefit of the consumer, focusing on promoting healthy competition in the marketplace.
Nevertheless, considering that the FCA is actually a regulatory body, this means it doesn’t facilitate help or mediation services when it comes to issues between the brokerages that are FCA regulated and their customers.
In spite of this, it is highly advisable to check whether a broker is regulated by the FCA, specifically if you want to assess the authenticity or reliability of a regulation. Another idea would be checking with the FCA warning list.
The Bottom Line
On a final note, even if some of the most renowned FCA regulated forex companies are based abroad, the majority have been regulated by other bodies, as well (e.g. Australian ASIC). As the trading industry develops, it is critical to develop a critical spirit in this respect to assess the reliability of a broker before funding an investment.