How to Verify a Broker
To verify a broker, look up its full legal name and registration number on the regulator's own register, typing the address yourself. Then check that the permissions cover what is being offered to you, read the client-money arrangements, and check the regulator's separate warning list.
Verifying a broker is four checks that take about ten minutes. None is difficult. They get skipped because a registration number in a footer looks like the check has already been done, and a number in a footer is a piece of text somebody typed.
Before you start
The regulator for the jurisdiction the firm claims, not the one where you live. A firm can be legitimately regulated somewhere with very different protections.
The firm’s full legal name and registration number, taken from their own documents. The trading name on the website is frequently not the registered entity.
An understanding that registration is a floor rather than a recommendation. It means minimum standards apply, not that the firm is a good one.
The steps
1. Go to the regulator’s site by typing the address
Not a link from the firm, not a search result, not a link in a document they sent. Cloned register pages are a standard technique and they are convincing.
2. Search the legal name, not the brand
The website says one thing; the terms and conditions name a company. Search the second one, and check the registration number beside it matches what the firm published.
3. Read the permissions
A firm may be authorised to introduce clients to somebody else rather than to hold money, or authorised for one product and offering another. The register says which.
4. Find the client-money arrangement
Segregated client accounts mean your money is held apart from the firm’s own. It is stated in the account terms, and its absence is significant.
5. Check the compensation scheme and its limit
Every regulated market has one, each has a ceiling, and it covers the firm failing rather than your positions losing money. Above the ceiling, two firms is the standard answer.
6. Check the warning list
Most regulators publish a list of firms they have warned about. It is not the same page as the register, and a firm can be absent from one and present on the other.
7. Verify any individual separately
If somebody is advising you or managing money, they have their own registration. A genuine person at a genuine firm is a different thing from either half alone.
How to tell it worked
The regulator’s address was typed manually, with 0 supplied links followed.
The legal name and number both matched the register entry.
The permissions cover the service being offered, read rather than assumed.
And the warning list was checked within the last 30 days.
What registration does and does not mean
It means minimum standards apply — capital requirements, client-money rules, complaint procedures and a regulator that can act. That is a genuine and substantial protection.
It does not mean the firm is good. Execution quality, platform reliability and cost are entirely outside what registration measures, and those are what you compare afterwards.
The jurisdiction question
A firm regulated somewhere with light requirements is still regulated. The registration is real; the protections behind it are different, and sometimes very different.
Check what the scheme actually covers and to what limit. That figure varies by an order of magnitude between markets, and it is the number that matters if the firm fails.
And check whether you are eligible for it. Some schemes cover residents only, so a firm’s protection may not extend to a client in your country — which is a detail that appears in the scheme’s own documents rather than in the firm’s marketing.
Doing all four in ten minutes
Two minutes to find the legal name. It is in the account terms or the footer’s small print, and it is frequently not the name on the sign.
Three minutes on the register. Search the legal name, confirm the number, and read the permissions section rather than stopping at the green tick.
Three minutes in the account documents. Client money segregated, which compensation scheme applies, and what its limit is.
Two minutes on the warning list. A separate search on the same site, and the one most people never perform.
Ten minutes, once, before any money moves. Compared with the alternative — discovering the answer during a withdrawal attempt — it is the cheapest ten minutes available in this whole subject.
The original data
Of the 24,971 unique videos in research/search-study-corpus.jsonl, 4 cover brokerage accounts in the
title, at a median of 32,349 views, and scams appear in 37 at 59,953 with only 8% instruction-shaped.
The counts come from site/corpus_count.py.
4 videos on brokerage accounts and 37 on scams, almost none instructional. The subject is covered extensively as cautionary stories and barely at all as the four checks that would settle it in ten minutes.
The answer to the question on that chart is that a number in a footer is text somebody typed. Verification means finding that number on the regulator’s register with the firm’s legal name beside it — and that is a different action from reading it on their own website.
When it fails
The failure is confirming that a registration exists without reading what it covers, and the result is a genuinely registered firm doing something it is not authorised for. The number checks out. The name matches. What the entry actually says is that the firm may introduce clients to another business, not that it may hold client money — and the account you have just funded is with an entity whose permissions never included holding it.
The second failure is following a supplied link. Cloned registers are convincing.
A third is searching the brand name. The registered entity is often different.
A fourth is assuming a compensation scheme covers you. Some are residents-only.
A fifth is skipping the warning list. It is a separate page.
And a sixth is treating registration as a recommendation. It is a minimum standard.
Related
Broker choice is what to compare once verification is complete. Introducing broker explains the permission most often misread. And settlement covers what happens to your money once it is with the firm.
Reading the permissions rather than just confirming a registration exists is what changed this for me. A firm can be genuinely registered for one activity and offering you a different one, and that situation looks identical to a fully authorised firm until you read the entry properly.
— Michael Whitman
This page is educational, not financial advice. Test every idea on your own charts before risking money.