Forex regulators: what they are and how much they protect you
When a broker says it's "regulated", not all regulations are worth the same. Here we explain what each one is (FCA, ASIC, CySEC…), which country it's from, and most importantly: how much it protects you if something goes wrong.
What does a regulator do?
A good regulator gives you four things:
🔒 Fund segregation
Your money is held separately from the broker's, in a bank. If the broker goes bust, they can't touch it.
💰 Compensation scheme
If the broker can't pay you back, a fund covers you (e.g. FSCS £85,000 in the UK, ICF €20,000 in the EU).
⚖️ Dispute resolution
You have someone to complain to (an ombudsman) and the regulator can fine or sanction the broker.
📉 Leverage cap
They cap extreme leverage (1:30 in the UK/EU) so you don't blow up in one shot.
Top-tier regulators (tier-1)
Serious oversight, protected funds, strict limits. What you want.
| Acronym | Regulator | Country | Protection | Max leverage | What it means |
|---|---|---|---|---|---|
| FCA | Financial Conduct Authority | United Kingdom | FSCS up to £85,000 | 1:30 | Among the strictest in the world. Mandatory segregation + compensation. |
| ASIC | Australian Securities & Investments Commission | Australia | No state fund | 1:30 | Strong, well-recognized oversight, but there's no compensation scheme. |
| CFTC / NFA | Commodity Futures Trading Commission / National Futures Association | United States | No forex insurance | 1:50 | Very strict, but retail spot forex has NO SIPC and no guaranteed segregation. |
| CySEC | Cyprus Securities and Exchange Commission | Cyprus (EU) | ICF up to €20,000 | 1:30 | Tier-1 with a 'passport' across the whole EU. Laxer than the FCA; many brokers use it as their base. |
| BaFin | Bundesanstalt für Finanzdienstleistungsaufsicht | Germany (EU) | EU scheme | 1:30 | German regulator, within the EU MiFID framework. |
| FINMA | Swiss Financial Market Supervisory Authority | Switzerland | esisuisse CHF 100,000 | varies | Swiss banking license (Swissquote, Dukascopy). Maximum solidity. |
| MAS | Monetary Authority of Singapore | Singapore | Per scheme | 1:20 | Asia's top regulator, demanding. |
| FSCA | Financial Sector Conduct Authority | South Africa | No fund | varies | Tier-2: genuinely supervises, but no compensation scheme. |
| CNMV | Comisión Nacional del Mercado de Valores | Spain (EU) | FOGAIN €100,000 | 1:30 | Spanish regulator, EU framework. |
| DFSA | Dubai Financial Services Authority | Dubai (DIFC) | Per scheme | varies | Regulator of Dubai's financial center. |
Offshore regulators (light-touch regulation)
High leverage and few requirements, but no compensation scheme. If something goes wrong, there's no safety net.
| Acronym | Regulator | Country | Protection | Max leverage | What it means |
|---|---|---|---|---|---|
| FSA Seychelles | Financial Services Authority | Seychelles | No compensation | up to 1:2000 | Light-touch license. It's where most brokers send the 'rest of the world'. |
| FSC Mauritius | Financial Services Commission | Mauritius | No compensation | high | Offshore, light-touch oversight. |
| FSC Belize | Financial Services Commission (ex-IFSC) | Belize | No compensation | up to 1:3000 | Classic offshore, very high leverage. |
| VFSC | Vanuatu Financial Services Commission | Vanuatu | No compensation | high | Offshore, minimal requirements. |
| BVI FSC | BVI Financial Services Commission | British Virgin Islands | No compensation | high | Offshore. |
| SCB | Securities Commission of The Bahamas | Bahamas | No compensation | high | Offshore. |
| CIMA | Cayman Islands Monetary Authority | Cayman Islands | No compensation | high | Offshore. |
| SVG FSA | St. Vincent Financial Services Authority | St. Vincent | None | no cap | ⚠ Does NOT regulate forex: it only registers the company. 'Having an IBC in SVG' ≠ being regulated. |
| St. Lucia | St. Lucia registry | St. Lucia | None | no cap | ⚠ Registers, doesn't regulate forex. |
| MISA | Mwali International Services Authority | Comoros (Mwali) | None | no cap | ⚠ Among the lightest that exist. |
How do I know which entity opens my account?
Don't trust the "FCA" logo on the homepage. These 4 checks tell you:
⚡ The leverage gives it away
The fastest tell: if they offer you 1:500, 1:1000 or 1:2000, it's definitely the offshore entity — tier-1 regulated ones cap you at 1:30. High leverage = little protection.
📍 Your country decides
Rule of thumb: if you live in the UK, the EU, Australia, the US or Canada, you get the local tier-1 entity. If you're from the "rest of the world" (LatAm, Africa, Asia, Middle East), they almost always open the offshore one.
📄 Read the "Client Agreement"
When you register, before you accept, it states the legal entity's name and its license (e.g. "X Ltd, Seychelles FSA SD…"). That's your real broker, not the group they advertise.
🔎 Their "Legal / Entities" page
Almost all of them have a section listing country → entity. And we've already summarized it: on each profile we tell you which entity applies to you based on your region.
The trick you need to know
Many brokers advertise "Regulated by the FCA" but, if you're not from the United Kingdom, they open your account with an offshore entity (Seychelles, Belize…) without that protection. On every ForexInspector profile we tell you which entity you actually trade under — not the one they display on the homepage.
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