How to check if a Forex broker is regulated and trustworthy
The forex market is one of the largest financial markets in the world, but it also attracts fraudulent brokers looking to scam traders. To protect your funds and ensure a safe trading environment, it’s crucial to verify a forex broker’s legitimacy before opening an account.
Here’s a step-by-step guide to checking if a forex broker is regulated and trustworthy.
⬇ Short on time? Skip ahead to discover trusted, regulated brokers! ⬇
Check the broker’s regulatory license
A legitimate forex broker must be regulated by a reputable financial authority. Some of the most respected regulatory bodies include:
- United States: National Futures Association (NFA) & Commodity Futures Trading Commission (CFTC)
- United Kingdom: Financial Conduct Authority (FCA)
- European Union: Cyprus Securities and Exchange Commission (CySEC), BaFin (Germany), AMF (France)
- Australia: Australian Securities and Investments Commission (ASIC)
- Switzerland: Swiss Financial Market Supervisory Authority (FINMA)
- Japan: Financial Services Agency (FSA)
➡ Global Forex regulators: the top most reliable brokers under FCA, CySEC, ASIC, MAS, and others
How to verify the regulation:
- Visit the regulator’s official website.
- Search for the broker’s name or license number in the regulator’s database.
- Ensure the broker’s listed address and details match the regulator’s records.
Warning: Some brokers claim to be “regulated” by offshore authorities with weak oversight (e.g., Vanuatu, St. Vincent, Mauritius). These licenses offer little to no protection.
Look for negative reviews and scam reports
Before depositing funds, research the broker online:
- Check Trustpilot, Forex Peace Army, and Reddit for user experiences.
- Search for “[Broker Name] scam” to see if traders have reported fraud.
- Avoid brokers with multiple unresolved complaints about withdrawals.
You can also check: Top Forex brokers with an excellent reputation: real traders reviews
Verify the broker’s company information
A legitimate broker should provide:
- A physical office address (not just a P.O. Box).
- Clear contact details (phone, email, live chat).
- A transparent terms and conditions document.
Red flags:
- No company registration details.
- Unprofessional website with poor grammar/spelling.
- Pressure to deposit quickly with bonuses.
Check the segregation of client funds
Regulated brokers must keep client funds separate from company funds. This ensures your money is protected if the broker goes bankrupt.
- Look for statements confirming segregated accounts with reputable banks.
- Avoid brokers that don’t disclose where client funds are held.
Test the withdrawal process
Before investing large amounts:
- Deposit a small amount.
- Request a withdrawal to confirm that the broker processes payouts smoothly.
- If withdrawals are delayed or denied, it’s a major red flag.
Top reliable FX and CFD brokers
Before trading, always verify a broker’s regulation to avoid scams. Here are 5 fully regulated and trustworthy brokers with key details:
XTB
- Regulation: FCA (UK), CySEC (EU), KNF (Poland)
- Why legit? One of Europe’s largest brokers, listed on the stock exchange
- Best for: Low spreads (from 0.1 pips), free withdrawals
- Min deposit: $0
OANDA
- Regulation: CFTC/NFA (US), FCA (UK), ASIC (Australia)
- Why legit? Operating since 1996, trusted by institutions
- Best for: US traders, transparent pricing
- Min deposit: $0
AvaTrade
- Regulation: Central Bank of Ireland, ASIC, FSCA
- Why legit? Regulated in multiple strict jurisdictions
- Best for: Copy trading, MT4/MT5 support
- Min deposit: $100
eToro
- Regulation: FCA (UK), CySEC (EU), ASIC (Australia)
- Why legit? Publicly traded company with strong oversight
- Best for: Social/copy trading
- Min deposit: $50
Risk disclaimer: eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 51% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
This communication is intended for information and educational purposes only and should not be considered investment advice or investment recommendation. Past performance is not an indication of future results.
Copy Trading does not amount to investment advice. The value of your investments may go up or down. Your capital is at risk.
Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more.
eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilizing publicly available non-entity specific information about eToro.
HF Markets
- Regulation: CySEC (EU), FSCA (South Africa)
- Why legit? Established in 2010, segregated client funds
- Best for: High leverage (up to 1:1000)
- Min deposit: $5
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How to spot a legit Forex broker - FAQ