Category: Regulation

Formed: 1 April 2013
Jurisdiction: United Kingdom
Headquarters: 25 North Colonnade London
Website: www.fca.org.uk

FCA Regulated activities

• corporate governance
• financial services
• securities and derivatives (category including Forex & CFD trading)
• insurance
• consumer protection
• financial literacy

Introduction to FCA

The Financial Conduct Authority (FCA) is a financial regulatory body in the United Kingdom that operates independently from the UK Government, is a conduct regulator for over 58,000 financial service firms, markets in the UK, as well the Prudential Regulation Authorization.

The FCA took responsibility for financial stability by bringing together a new regulatory structure and enhance its predecessor the Financial Services Authority (FSA) responsibilities, the agency that regulated financial service between 2001 and 2013. The authority received significant power to cover responsibility for regulation of the financial sector and firms, including CFD and Forex brokers, providing services to traders and investors. The objective of FCA is a maintenance of the financial market integrity in the United Kingdom and secure an appropriate degree of trader’s protection.

FCA, as an independent public authority, regulate the conduct by both retail and wholesale financial services firms with a purpose defined by the Financial Service and Market Act 2000 (FSMA). FCA aims to make financial markets work well so that traders and investors get a fair deal, through its enhanced market integrity and promote competition.

In this FCA review to get things more clear we cover the following highlights:

• Why trade with an FCA regulated broker?
• FCA Brokers Requirements and Regulation
• How to submit complaint and FCA Customer Support Service
• List of FCA Regulated Forex Brokers
• Conclusion on FCA regulation

Why trade with an FCA regulated broker?

In fact, any firm in the UK whether a business, asset manager, broker or financial investment firm the activity is mandated to be registered and regulated by the FCA. First of all, the FCA set a range of registration requirements before the broker is allowed to operate in the market, which includes raising of fees with a high initial capital to apply for the FCA license and carry out its regulated activities further. The license type based on factors such as a scale of activities and divided to STP license (check on STP Forex Brokers), which imposes EUR 125,000 initial capital and EUR 730,000 for Market Making license. In addition, upon application, the company will be checked for its adequacy to operate in the market, with a review of business plans, its budgets, resources, applied systems, and controls.  The directors and key staff will be interviewed and obliged to have the necessary qualifications with an effective background, so the requirements are met and the director experienced enough to run the brokerage.

In addition, the broker should maintain a physical office in the UK and organized to comply with the FCA rules and mandates at all times. FCA Brokers operate their business based on the FCA handbook guidelines to ensure clients are being treated fairly, the information provided accurately and most important, transparently.

The protective measures that are important to the trader, in particular, issues brokers in demand to segregate the client’s funds from the broker’s operational fund. That means broker stores their operation fund at separated from the client bank account, thus cannot use clients money for any purpose or even touch it. Furthermore, FCA brokers provide negative balance protection to their traders, so clients cannot lose more than its initial deposited capital. Lastly, the maximum of protection level achieved by solve of an unlikely event when a broker goes bankrupt or fall under insolvency issues, the client and his funds are protected, by the Financial Services Compensation Scheme (FSCS) so the client receives funds back with an upper limit of GBP 50,000 per client.

The regular supervision tasks of FCA ensures follow of strictest demands, while every authorized entity report, confirm and maintain on a daily and monthly basis, respectively, otherwise, the authority will get involved and will check the performance in detail. In the event broker didn’t follow FCA handbook guidelines, it may cause further investigation of a case, with imposing of fines, while powers have already been seen loads of their announcements, heavy fines or even dismisses of the broker’s license. See below an example of some of the largest financial penalty in the history of £284,432,000 for forex failings. In addition, the FCA is able to ban financial product, firm or the particular asset manager, as well have the power to instruct firms to immediate action, modification or its revoke if necessary.

With all the strict regulatory guidelines, if a trader or investor still believes they are encountering unfair trading experience with the broker, they can file a complaint against the broker with the relative department. Firstly, the regulated brokers in place must have a procedure to resolve disputes and respond within a set time, however, you can always go further and submit a complaint to the Financial Ombudsman Service, known as claim handlers. In addition, read our step by step guideline how to a complaint an FCA regulated forex or CFD broker.

Submit the complaint about UK broker: https://help.financial-ombudsman.org.uk/help

The benefits of trading with the FCA regulated Forex Brokers are at a glance, as the authority ensures strongly the broker’s responds, monitoring products, and other issues along with the compensation when necessary. Overall, the FCA made it in a scrupulous way by the sharp check on the firm, that the brokerage is computable to the successful prospective of operation, further market development and of course fair treatment of the traders. Therefore, FCA gained its highest consumers’ rankings, as the traders getting appropriate trading needs among market offering, unparalleled advice and knowledgeable behavior towards any occurred questions.

Moreover, the education and permanent support at FCA allows to find out about customer rights and financial advice, offers to complain, report a scam or unauthorized firm. And provides a guideline on how to avoid scams, with the comprehensive Avoid listing up-to-date.

FCA consumer organizations service: https://www.fca.org.uk/consumers

List of FCA Regulated Forex Brokers

The trader should carefully search for information about FCA forex broker license directly through an official site, which will appear on the Financial Services Register.

Moreover, the regulated broker website at most cases shows its FCA register number, yet confirm its statement at official source as well, due to numerous clone and fraud firms that use register number to pretend official.

In addition, always check FCA Brokers Reviews, in the instance the full list of the UK regulated brokers’ list at our website currently includes over 80 FCA Regulated Brokers, and growing, while the total number of licensed ASIC Regulated Forex Brokers exceeds 340.

Conclusion on FCA regulation

The UK as one of the most respected and known financial centers that deliver strong economic figures throughout history, as well as stable political positions and influence on international markets, keeps the excellent level of a regulatory system.

In fact, FCA is one of the most respected trading industry authorities that establish the highest protective tools and keeps market integrity through its strong influence and monitor of the situation. The FCA enhanced their responsibilities to the financial and traders sectors by transparent ways the agency determines policies and carries its supervision functions. Also, as the main message of FCA is to only cooperate with authorized firms, the authority supports vast of data on how to make the best practice and avoid frauds. Read more about how Forex Trading Scam work at our article by the link.

Overall, some of the most reputable brokerages and regulated firms indeed regulated by FCA, while the status of FCA regulated Forex Broker the trader or investor can trade assured of a fair and effective deal and an accurate follow of obligations towards the clients’ protection with the legit regime itself.

• What is SVG FSA?
• Why not trade with an SVG FSA registered broker?
• SVG registration requirements and its “regulation”
• Is there a way to submit complaint to SVG FSA?
• List of SVG Forex Brokers
• Conclusion on SVG FSA

Introduction to SVG FSA

What is SVG FSA? 

St. Vincent & the Grenadines or SVG through increasing demand for the financial sector and offshore zones itself created the Financial Services Authority FSA with a responsibility to regulate non-bank, certain entities in the financial sector and control the international financial services industry.

• SVG FSA was established November 2012, with a mission as the authority mentions on its official website – to develop, regulate and supervise St. Vincent and the Grenadines as a secure and competitive financial center in the international and the financial sector in accordance to best practices.
• However, Forex Trading or Brokerage activity, which is the main topic in financial investment world also rapidly growing in its demand, does not have a solution of regulation of Forex, CFD and Binary Options in SVG.
• The regulation or even licensing of the Forex business is not a part of the SVG FSA activity, as stated by the official warning.
• “There are financial institutions out there that falsely claim they are registered or licensed in our jurisdiction. Their purpose for doing this is more than likely for illicit reasons and potential customers should be very cautious about conducting business with them. 
  FSA, St Vincent and the Grenadines. (Learn more about SVG FSA Function Role)

Is SVG Broker Scam or Safe? 

St Vincent and the Grenadines of SVG is an island in the Caribbean, which became quite a known location for its tax haven offering out of the international companies. St Vincent is indeed an attractive solution among financial companies and those businesses that for one reason or another choose to operate through an offshore company.

• Since the jurisdiction itself offers easy-to-achieve setup demands through very quick, simplified process, while the firm does not necessarily need to operate an office in SVG, allow to maintain low initial capitals, no strict establishment rules or requirements, yet allows running a global business.
• Furthermore, there is no sharp regulation or overseeing of the company operation implemented and Forex Business itself is not regulated, see snapshot from FSA SVG website below. 
• Therefore, Forex business established in SVG is not well regulated in St Vincent, the SVG broker can run its activity, provide trading environments and accept Forex payments through credit cards, but is not overseen well in comparison to the top tier authorities, for this reason is not safe entough to trade or recommended to sign in. See our list of offshore and Unregulated Broker to Avoid, or Read more about Why Trade with FCA UK Brokers) 

Why not trade with an SVG FSA Registered broker?

Considering the fact that SVG FSA enables low set up requirements with No business planning, No management interview or check of the company background. While the registered company operates with No Handbook, No Regulatory Reporting, No Impose of Fines in case of its malicious service and there is No any protection implied alike Fund Segregation, Negative Balance Protection or Compensation in case of insolvency. We can not conclude SVG Broker as safe to trade and better advise to avoid them. 

• Therefore, apart from beautiful seaside beaches, the SVG with its offshore environment became a known hub of financial firms, while the legal environment can be quite loose towards the Forex business and brokerage itself. For better understanding check out the UK FCA Authority and its sharp regulation, overseeing of the brokerages and heavy fines in case of the company fail to obligations, see snapshot of UK FSCS protection applied too, while SVG Brokers apply none. 

SVG Registration Requirements

Obviously, the investment and trading service is a popular trend, however in order not to fall under the scams and frauds, which are in fact growing daily, you should carefully choose a company before any funding is done. Forex and derivatives trading as a decentralized market can be a highly risky opportunity if the company delivers trading service without strict overseeing from the industry authority.

• For that reason, we always advise choosing among the most reputable and of course heavily regulated brokers and to protect yourself from potential scammers. For instance, as an example learn and compare eToro offering and heavy regulation.
• To get more knowledge, you can also read our article Forex Trading Scams and know how to protect yourself, with a deeper understanding of how frauds work.
• In addition, most often an offshore broker alike SVG Brokers are associated with other companies while the offering varies slightly from the majority of frauds, yet the result is equally disappointing. The major concern about lack of regulatory oversight places SVG companies much under the recommended safety line, in essence, you only get the honest word of the company.

Complaints and scams to SVG FSA

We have received many user reviews, while the majority of them are obviously negative. What are the Complaints about? Mainly – Rejects client withdrawal, meaning a client who puts money cannot get profits or funds back. See popular Broker – Olymp Trade and read comments from real traders below.

• In case you have negative scenario or behavior from the Broker in SVG, SVG FSA will not be able to assist through customer protection, to advise or take action further, the trader stands completely alone at that point. Therefore, there is no way to complain or receive any support from the authority. See snapshot from SVG FSA about risks involved. 

Fake Trading Brokers

In addition, there are many fake brokers stating their address, regulation or registration at SVG, while pretending to be a legit firm but in fact are not.

• SVG authority recognized the risky potential and just warn traders that in case of trading with an unlicensed and unregulated company the trader using the services at his own risk. As an unlicensed or offshore broker most often not subject to any supervision of practice or regulatory laws the company may easily mislead or false any information or the service providing itself.

The only way the SVG FSA tries its attempt to protect clients is to place an advise and list entities at the alert area as of the false license claims in the SVG jurisdiction, yet the protection “actions” are ending just by that. SVG FSA – Investor Alerts 

List of St Vincent and the Grenadines Forex Brokers

Currently, we have reviewed many Forex Brokers from St. Vincent and the Grenadines, while none of them were included into the list of trusted or brokers with a recommendation of safe trading. The only companies that may be trusted are those brokerages that hold additional licenses from reputable authorities and at the same time run business in SVG for international access, check GO Markets Broker.

• We suggest check on the broker carefully before any sign in is done, revise the broker’s regulation status, its authorization claims, news and reputation by reading reviews and checking on the legit documentation.
• As well, you can find and verify company you concerned about at our regularly updated list of Brokers to avoid or submit your inquiry. Then if you found a broker at the list you better stay away from any cooperation or trading with them at all cost, as listing consists of mainly non-regulated and offshore firms which are not recommended or safe. 

Conclusion on SVG regulation

The final thoughts conclude that traders and investors should ensure a clear understanding of the procedures and risks involved while the company or another offering the forex trading opportunity and not properly licensed, or in other words is offshore Broker like SVG Brokers are. 

• As of the recent growth of international trend of Forex, trading investors are urged to exercise caution before any sign in or acceptance of the offering. Any broker declares its regulation by FSA SVG, in substance, made a false claim. As it became clear now, why the SVG incorporated firms disclose information on the risks, in particular, the possibilities of loss, therefore we recommend avoiding offering from the brokers mentioning their SVG FCA regulated status.

In order to become a trustable company in providing financial and trading service, the Broker should be sharply regulated and retain a sufficient level of reputation through its operational history. Definitely, it is not a gaining point towards trust to the brokerage that is an offshore-based company and was established with a low registration requirement while none of the protective principles followed.

The security of funds always stands first, therefore, you better consider brokerages from other jurisdictions that maintain a sustainable level of financial and investment services and forex trading in particular through a protective set of rules. For this, we advise finding a broker with licenses from top-tier authorities, such as FCA, ASIC, or CySEC. Sign in only with trustworthy brokers, such as FP Markets, HFM, or recommended brokers by the link.