FCA CFD Crackdown: What Brokers and Buyers Should Check
A broker’s website names an FCA authorised company. The customer opens an account under the same brand, but signs with an overseas affiliate. Which company owes the customer obligations, and which protections apply?
For cross border groups and prospective buyers, that question should sit at the centre of any FCA CFD authorisation review.
What the FCA announced
On 25 September 2026, the FCA reported that 21 CFD firms had closed since 2025 and three more were cancelling their permissions following its crackdown. Its concern was that firms with little UK business used their authorisation to bolster overseas affiliates, misleading customers about their provider and protection.
Interventions included trading restrictions, independent reviews and enforcement investigations in the two most serious cases. The firms were not named.
The total combines earlier closures and pending cancellations; it does not mean 24 authorisations were revoked on the announcement date.
“Consumers need to know exactly who they’re dealing with and what protections they have,” said Dominic Holland, the FCA’s director of sell side supervision.
This follows the FCA’s 30 October 2025 warning about the loss of retail protections when customers are pushed towards professional classification or redirected to overseas providers without equivalent safeguards.
Authorisation belongs to the entity, not the brand
FCA authorisation attaches to a legal entity and its permitted activities. Shared shareholders, websites and trading names do not extend it to separately incorporated group companies.
A branch is different: it forms part of the same legal entity. Even then, the location and manner of service delivery can affect which rules and protections apply, as the FCA explains in its approach to international firms.
An overseas affiliate, introducer or outsourced service provider should not be presented as though it holds the UK company’s authorisation. Its actual role and regulatory position need to be established separately.
Follow the customer from advertisement to funded account
The FCA’s CFD guidance warns about similar company names and shared trading names, and tells customers to check the entity identified in the terms and conditions.
The FCA also recommends its Firm Checker. It cautions that UK protections are unlikely to apply when customers deal with a similarly named overseas company.
A useful practical review follows one customer journey through:
- The advertisement, landing page and country selector.
- The application form, client agreement and risk disclosures.
- The account approval email, CRM portal and trading account.
- The deposit instructions, account beneficiary and payment processor.
- The complaints procedure, governing law and support correspondence.
At each stage, ask whether the customer can identify their contractual counterparty. A payment processor may legitimately differ from that counterparty, but its role and the funds flow should be explained and documented.
UK protection requires a separate assessment. Retail CFD safeguards include leverage limits, margin close out and negative balance protection. Access to the Financial Ombudsman Service and Financial Services Compensation Scheme depends on their respective jurisdiction and eligibility rules. Overseas residence alone does not exclude an eligible Ombudsman complaint; appearing on a group website that mentions FCA authorisation does not establish protection either. See the Ombudsman’s eligibility guidance and FSCS investment protection guidance.
When website design creates regulatory risk
Review the overall impression, including mobile pages and translated versions. Practical warning signs include:
- A prominent UK regulatory claim followed by an unexplained redirect to overseas onboarding.
- “FCA regulated” applied to the group without identifying the authorised company.
- UK protection statements beside an application for an overseas entity.
- Similar company names or vague references to “affiliates” that obscure who provides the service.
The FCA requires financial promotions to be fair, clear and not misleading. A footer should not be relied on to correct a misleading customer journey. The FCA logo is also restricted: authorisation does not give a firm permission to use it in promotional material.
Treat entity selection and regulatory disclosure as part of financial website design, including the handover from public pages to account opening.
What a new FCA application needs to explain
A credible application should describe the business the applicant will actually conduct: customers, countries served, revenue sources, staffing, governance and operating arrangements. The FCA’s application guidance calls for a detailed regulatory business plan, including customer profiles and distribution.
For a cross border CFD group, translate that into a clear account of the intended UK business, overseas relationships, customer allocation and management oversight. Explain who controls marketing, approves changes and monitors introducers. Forecasts and operating plans should support the same business model.
Buying an FCA authorised CFD firm: examine its overseas reach
For acquisition due diligence, a small UK customer book should prompt questions about the target’s wider role. Our recommended review covers:
| Review area | Evidence to request |
|---|---|
| Permissions | Current Register status, permitted activities, client types, limitations and requirements; investigate “Applied to cancel” and, for relevant EEA firms, “Supervised run off” |
| UK business | Active clients, revenue by entity and geography, regulatory returns and supporting records |
| Overseas relationships | Group structure, brand licences, referral agreements, commissions and customer routing rules |
| Marketing history | Archived websites, translated pages, advertisements, affiliate campaigns and approval records |
| Regulatory exposure | FCA correspondence, complaints, independent reviews, remediation and any pending cancellation, restriction or enforcement matter |
| Buyer’s business plan | Proposed changes to customers, management, outsourcing, marketing and permissions |
The FCA’s CFD guidance says firms marked “Applied to cancel”, and EEA firms in “Supervised run off”, should not take on new UK clients.
Reconcile the records. If UK trading revenue is minimal while the UK company features prominently in overseas campaigns, establish who benefits, who approves the claims and where customers ultimately contract. The mismatch warrants investigation; it does not by itself prove a breach.
A share purchase leaves authorisation with the same company. For a UK authorised target, an acquisition triggering the control regime requires prior regulatory approval. For MiFID investment firms, control bands start at 10%, but significant influence can also trigger the regime below that level. UK advisers should assess direct and indirect holdings and any aggregation.
The FCA has up to 60 working days to assess a complete notification, excluding permitted interruption periods for further information. This is not a guaranteed transaction timetable. Approval does not expand permissions: activities outside the existing scope require the appropriate variation of permission before they begin.
For the broader transaction choice, see buying an existing financial licence versus applying for a new one.
Run an entity consistency audit before proceeding
Build a simple matrix linking each company to its registration, FCA status, domains, client agreements, bank and EMI accounts, trading platform licence agreements, and CRM, liquidity and payment contracts. Add invoices, privacy notices and customer service signatures.
Different entities may perform different functions. Record why each appears and whether the customer facing explanation matches its contractual role.
Pause unverified regulatory claims, preserve historic materials and map customer journeys by country. Have qualified UK legal and regulatory advisers assess unresolved issues. For buyers, put required approvals and remediation into completion conditions, with responsibility and costs allocated in the transaction documents.
How FinPro Consulting can support
FinPro Consulting helps operators and buyers assess business and permission requirements, coordinate regulatory due diligence, review entity disclosures across websites and onboarding, and prepare licensing, governance and compliance materials. We can also coordinate qualified UK legal advisers.
If your group uses UK authorisation in overseas marketing, or you are reviewing a CFD acquisition, contact FinPro’s financial licensing team with the group structure, target entity and principal websites to define the review scope.
FinPro Consulting is not affiliated with the FCA. This article is general information, not legal or regulatory advice, and we cannot guarantee any authorisation or change in control outcome.
Frequently asked questions
Can an FCA authorised CFD firm serve overseas clients?
Potentially, subject to its permissions, applicable UK rules and the laws of the customer’s jurisdiction. The announcement does not impose a blanket ban on overseas clients.
Does FCA authorisation cover overseas affiliates?
No. A separately incorporated affiliate does not obtain authorisation through common ownership or branding.
Can several regulated entities share one website?
Potentially. The website and onboarding must make the relevant provider, regulatory status and applicable protections clear. Shared branding does not resolve those obligations.
What should a buyer prioritise?
Verify permissions, actual UK activity, overseas marketing and referrals, customer allocation, and the complete regulatory history. Test the proposed business model against the target’s permissions.
Does buying the company automatically transfer its licence?
No separate licence transfer occurs in a share purchase: the company remains the permission holder. Applicable change in control approval is required before control changes.
Can limited UK business lead to restrictions or cancellation?
It can attract scrutiny, but low UK volume alone does not establish non-compliance. The FCA also has powers concerning unused permissions. The firm’s actual activities and the relevant statutory grounds matter.
