Finding a forex broker begins with one basic question: is the company really licensed in the place it says it is? A licence number on a broker's site is a claim, not proof. This article shows how to verify that claim on the regulator's own public register before you send any money, and what to look for once you locate the entry.

Why Check the Licence First

A authorisation from a strong regulator may offer meaningful safeguards, such as client money held separately and, in some jurisdictions, a compensation scheme. However, authorisations can change: companies are sold, rebranded, sanctioned or lose their licence. Some firms 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 smaller 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.

Brokers Covered on FXSharp

The companies below have an independent review on FXSharp. Most hold licences from recognised regulators, while some also serve clients through offshore entities with lighter protection. Find out 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

Steps to Verify a Broker Yourself

Find the full company name and licence number in the legal section of the broker's site or in its client agreement. Next, go to the regulator's site 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 display 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 wary if the register shows a similar 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 Later On

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 may save you from serious losses. Leveraged trading in forex and CFDs carries a high risk of losing money, so verify first, then read more you invest.