The UK’s Financial Conduct Authority is going after a specific kind of deception this year: firms that hold real UK authorisation but use it mainly to lend credibility to businesses that are not actually regulated the way customers assume. The FCA said on September 25 that 24 CFD firms have closed or are closing as part of a crackdown on this pattern, with 21 shutting since 2025 and three more currently cancelling their permissions. In the two most serious cases, the regulator has restricted the firms’ trading activities, required independent business reviews, and opened formal investigations.
“Consumers need to know exactly who they’re dealing with and what protections they have. When firms blur the lines between their UK-regulated activities and overseas businesses, we will step in,” said Dominic Holland, the FCA’s director of sell-side supervision.
The mechanism is specific: these firms carried minimal actual UK business activity, but kept their authorisation active so linked overseas entities could appear more legitimate to customers who assumed they were dealing with a fully protected, UK-regulated counterparty. That is a distinct target from the FCA’s earlier CFD work, which focused on restricting how CFDs could be sold to retail customers in the first place. The original insight is that the FCA is now treating authorisation itself, not just product design or sales conduct, as something that can be misused and needs policing on its own terms. A firm can comply with every product rule and still be operating a deception if its UK licence functions as a badge of trust for a business the licence does not actually cover.
This is not the FCA’s first pass at cleaning up firms that trade on borrowed UK legitimacy. The regulator took a similar approach to unlicensed activity in its crackdown on illegal crypto trading in London, and the enforcement pattern echoes concerns raised in a look at how the FCA’s bans keep coming after the money is already gone, suggesting the regulator is trying to get ahead of authorisation misuse before losses accumulate rather than only clean up afterward.
Source: Financial Conduct Authority
