FCA: 24 CFD firms closing over misuse of UK authorisation

What the FCA announced

On 25 September 2026 the Financial Conduct Authority confirmed that 21 Contracts for Difference firms have closed since 2025 following its crackdown on the sector, and that 3 other firms are currently cancelling their permissions. That is 24 firms in total either gone or on the way out. The number matters because it shows the scale of the FCA's concern about how some firms were presenting themselves to UK consumers, and it shows the regulator was willing to act rather than simply issue guidance.

The specific concern was not that these firms were trading CFDs badly in a technical sense. It was that they were misusing their authorised status to mislead consumers. The FCA has been challenging CFD firms that carry out little UK business but use their authorisation as a badge to make linked overseas companies look more trustworthy than they really are. That creates the misleading impression that consumers are dealing directly with a UK-regulated firm and benefit from UK protections when they do not. In practice, a consumer might see a familiar UK regulatory status on a website, open an account, and later discover the account is actually held by an overseas entity with a very similar name.

Firms have faced a range of actions including restricting their trading abilities, requiring independent reviews of their business, and opening enforcement investigations in the two most serious cases. Dominic Holland, director of sell-side supervision at the FCA, said consumers need to know exactly who they are dealing with and what protections they have. He said the FCA will step in when firms blur the lines between UK-regulated activities and overseas businesses, and that these closures show the FCA is prepared to take action to protect consumers. For anyone holding a CFD account, or considering one, the practical question is which legal entity actually holds the account and which regulator stands behind it.

What a CFD actually is

A CFD, or contract for difference, is a leveraged contract used to speculate on price movements without owning the underlying asset. You are not buying a share, a currency or a commodity. You are agreeing to exchange the difference in value of that asset between the time the contract opens and the time it closes. If the price moves in your favour, the firm pays you the difference. If it moves against you, you pay the firm. The asset itself never changes hands, which is why CFDs are often described as a way to trade the movement rather than the thing itself.

The leverage is what makes CFDs risky. Leverage means you put down a small amount of money to control a much larger position. That magnifies both gains and losses. Losses can exceed expectations quickly because of leverage, and the FCA says large losses can build up very quickly. A small adverse price move can wipe out the margin you posted and leave a deficit. This is why the FCA says consumers thinking about trading CFDs should remember these products are complex and often involve high levels of leverage. CFDs are used to speculate on the movement in prices across a wide range of assets and carry a considerable risk of substantial losses.

Regulators have treated these products as unsuitable for most retail consumers for years. In 2019 the FCA confirmed permanent restrictions on the sale of CFDs and CFD-like options to retail consumers. Those restrictions included leverage limits and negative balance protection, which stops a retail consumer losing more than the money in the account. The protections exist because the product is capable of causing serious harm when sold without limits. The point of the 2019 rules was to make sure that when a UK retail consumer trades a CFD through a UK-authorised firm, the downside is capped and the firm is accountable to UK rules.

The offshore problem, in a table

The difference between dealing with a UK-authorised firm and being onboarded to an overseas entity is not a technicality. It changes who regulates the firm, who can compensate you, how much leverage you can be offered, and who you complain to. The table below sets out the contrast in concrete terms.

The reason a similar name matters is that it defeats the check most consumers actually perform. A consumer sees a name they recognise, assumes it is the UK firm, and stops looking. But the account documents may name a different legal entity in a different jurisdiction. If that entity fails or treats you badly, the UK safety net is not there. The FCA states that where you are dealing with an overseas firm with a very similar name, UK regulatory protections are unlikely to apply. That is the gap the FCA has been closing.

How the FCA got here

The action did not appear suddenly in 2026. It followed a sequence of interventions that built up over several years, each one narrowing the space in which firms could operate. In 2019 the FCA confirmed permanent restrictions on the sale of CFDs and CFD-like options to retail consumers. That set the baseline: retail consumers in the UK would only be sold these products with leverage limits and negative balance protection. It also signalled that the regulator viewed the product as unsuitable for mass retail distribution without safeguards.

In 2024 the FCA set out its priorities for the CFD sector in a portfolio letter. A portfolio letter is the regulator's way of telling a whole sector what it will focus on, and it puts firms on notice that certain behaviours will attract scrutiny. For CFD firms, that meant the FCA was looking closely at how they were structured, how they marketed, and where their customers were actually booked. In 2025 the FCA warned that investors in CFDs risked losing out on UK protections through redirection offshore. That warning was aimed squarely at the pattern that later drove the closures: a UK-authorised firm with little UK business, and a linked overseas company taking the customers.

By 2026 the consequences arrived. The FCA has been challenging CFD firms that carry out little UK business but use their authorisation as a badge to make linked overseas companies look more trustworthy than they really are. Firms have faced a range of actions including restricting their trading abilities, requiring independent reviews of their business, and opening enforcement investigations in the two most serious cases. The result is 21 closures since 2025 and 3 more firms currently cancelling their permissions. The FCA says these closures show it is prepared to take action to protect consumers, and that it will step in when firms blur the lines between UK-regulated activities and overseas businesses.

What to do before opening an account

Before opening a CFD account, use the FCA Firm Checker to confirm you are dealing with a UK-authorised firm and not an overseas firm with a very similar name. The Firm Checker is the FCA's own register, and it is the authoritative source. Do not rely on a search engine result, an advert, or a logo. The FCA advises consumers to use its Firm Checker for exactly this purpose, and it states that where you are dealing with an overseas firm with a very similar name, UK regulatory protections are unlikely to apply.

Match the firm reference number rather than the name. Names can be copied, varied by a single word, or made to look like a group brand. The firm reference number is the identifier the FCA uses, and it is the thing to compare against the register entry. If the number on the website or the account documents does not match the register entry for the firm you think you are dealing with, stop. Then check which legal entity the account documents name. The terms and conditions, the client agreement and the account opening pack will name the entity that actually holds the account. That entity, not the brand on the homepage, is who you have a contract with.

Be alert to near-identical names. A UK-looking website does not mean a UK entity. A firm can have a UK presence, a UK address and a UK-authorised group company while the account itself sits with an overseas entity. The FCA's concern is precisely that firms were using authorisation as a badge to make linked overseas companies look more trustworthy than they really are, creating the misleading impression that consumers are dealing directly with a UK-regulated firm and benefit from UK protections when they do not. If the entity named in the documents is not the entity on the register, the protections described in the table above are unlikely to follow.

If you already have an account

If you already hold a CFD account, the first step is to establish which entity holds it. Check the client agreement, the account opening documents and any recent statements or correspondence. The entity named there is the one you are dealing with, regardless of the brand name on the platform. Once you know the entity, check it on the FCA Firm Checker and compare the firm reference number. If the entity is not UK authorised, the FCA's position is that UK regulatory protections are unlikely to apply, which affects what you can expect if something goes wrong.

Next, work out what protections apply. If the account is with a UK-authorised firm, FCA rules apply, leverage limits and negative balance protection should be in place, you may be eligible for FSCS compensation if the firm fails, and you can take an unresolved complaint to the Financial Ombudsman Service. If the account is with an overseas entity, those protections may not be available, and the complaint route will be in the overseas jurisdiction. The FCA says consumers need to know exactly who they are dealing with and what protections they have, and that is the check to perform now rather than after a problem arises.

Finally, know where to complain. Start with the firm's own complaints process, using the entity named in your documents. If the firm is UK authorised and the complaint is not resolved to your satisfaction within the set period, the Financial Ombudsman Service is the next step. If the entity is overseas, the ombudsman route is unlikely to be open, and the FCA's warning about redirection offshore is directly relevant. For background on the regulator's warnings and how they have developed, see the KT coverage of FCA warnings. The FCA has said it will step in when firms blur the lines between UK-regulated activities and overseas businesses, and the 24 firms closed or cancelling permissions show that position being enforced.

Related coverage on Kael Tripton: Ultrabrokers: FCA Warning - Not Authorised (4 June 2026), www.privatemarketunlock.uk: FCA Warning - Not Authorised (5 June 2026), FCA Clone Firm Fraud: How to Detect and Avoid Investment Scams Impersonating Authorised Firms, Best Day Trading Platforms UK 2026: Fees, Spreads and FCA Rules Compared, Car Finance Complaints: 719 Trading Names, Just 106 Real Lenders.

Frequently asked questions

How many CFD firms have closed since 2025?

21 CFD firms have closed since 2025 following the FCA crackdown, and 3 other firms are currently cancelling their permissions. That is 24 firms in total either closed or in the process of cancelling.

What were the CFD firms doing wrong?

The FCA was concerned the firms were misusing their authorised status to mislead consumers. The FCA has been challenging CFD firms that carry out little UK business but use their authorisation as a badge to make linked overseas companies look more trustworthy than they really are, creating the misleading impression that consumers are dealing directly with a UK-regulated firm and benefit from UK protections when they do not.

What is a CFD?

A CFD, or contract for difference, is a leveraged contract used to speculate on price movements without owning the asset. Losses can exceed expectations quickly because of leverage. The FCA permanently restricted the sale of CFDs and CFD-like options to retail consumers in 2019.

Why does an overseas entity with a similar name leave me unprotected?

If you are onboarded to an overseas entity, FCA rules do not govern its conduct, Financial Ombudsman access is unlikely to be available, FSCS compensation eligibility is unlikely to apply, and leverage limits and negative balance protection may not apply. The FCA states that where you are dealing with an overseas firm with a very similar name, UK regulatory protections are unlikely to apply.

How do I check a CFD firm before opening an account?

Use the FCA Firm Checker to confirm you are dealing with a UK-authorised firm and not an overseas firm with a very similar name. Match the firm reference number rather than the name, check which legal entity the account documents name, and be alert to near-identical names. A UK-looking website does not mean a UK entity.