You search for one broker, open one familiar website and see one logo. Yet the account offered to a UK resident may sit with a British company, the account offered in much of the European Economic Area may sit with a Cyprus company, and an international applicant may be routed to a Bahamas company.
That routing decision can change the company named in your contract, the regulator whose register you should search, the maximum retail leverage, the compensation arrangement and the route you can use after a complaint. The brand name does not answer any of those questions.
Short answer: FCA, CySEC and an offshore regulator are not simple safety grades. Start with the exact legal entity in your application or agreement, then compare the rules and remedies attached to that entity. Some safeguards may look similar while compensation and complaint routes remain very different.
How this article was checked
FXPEDIA360 checked the comparison against FCA rules and consumer guidance, CySEC’s current CFD directive and Investor Compensation Fund information, and the Securities Commission of The Bahamas CFD Rules and complaint guidance on 31 August 2026. Pepperstone is used only as a worked legal-entity example because official records show entities in all three jurisdictions. No broker supplied or approved this article. AI assisted drafting, but each material claim was checked against the linked source.
The comparison starts with three company names
Pepperstone illustrates the problem clearly. The brand’s own legal-document page says that the documents applying to an account vary according to the entity holding it. Official and company records identify:
- Pepperstone Limited, a UK company associated with FCA Firm Reference Number 684312.
- Pepperstone EU Limited, Cyprus company number HE 398429 and CySEC licence 388/20.
- Pepperstone Markets Limited, Bahamas company number 177174 B and SCB registration SIA-F217.
This does not mean every visitor can choose freely among the three. Country eligibility, onboarding rules and the firm’s own routing policy affect the offer. It does mean that a review of the brand alone is incomplete. Your application form, client agreement and account-opening confirmation are the evidence that matters.
Protection matrix: what the regulator label does and does not tell you
On a phone, swipe the table left to see every column.
| Checkpoint | UK FCA retail CFD account | CySEC retail CFD account | Bahamas SCB retail CFD account |
|---|---|---|---|
| Worked entity | Pepperstone Limited, FRN 684312 | Pepperstone EU Limited, licence 388/20 | Pepperstone Markets Limited, SIA-F217 |
| Major FX opening leverage | Opening margin of 3.33%, commonly described as 30:1 | Initial margin of 3.33% for major currency pairs, commonly described as 30:1 | Minimum opening margin of 0.5% for specified major currency combinations, equivalent to up to 200:1 |
| Margin close-out | Account net equity must not fall below 50% of required margin; positions must be closed as soon as market conditions allow | Account-level protection applies when funds and unrealised net profit fall below half of total initial margin protection | 50% threshold, but the rule also permits the firm to have the client add margin to restore compliance |
| Negative balance protection | Retail liability for covered speculative investments connected to the account is limited to the funds in that account | Retail aggregate CFD liability is limited to funds in the CFD trading account | Retail CFD liability is limited to funds in the account under rule 29 |
| Client funds | FCA CASS rules apply where the firm holds or controls client money within scope | Check the CIF’s terms, permissions and applicable client-asset rules for the contracted service | CFD margin in a retail client account must be segregated and may not be borrowed, charged or used for another purpose |
| Failure compensation | Potential FSCS investment protection up to £85,000 per eligible person, per firm, if the firm, activity and claim qualify | Cyprus ICF coverage for eligible covered clients is the lower of 90% of cumulative covered claims and €20,000, subject to its conditions | Do not assume a UK FSCS or Cyprus ICF equivalent. Verify any claimed arrangement from an official SCB or statutory source before relying on it |
| Complaint route | Complain to the firm first; eligible unresolved complaints may reach the UK Financial Ombudsman Service | Complain to the CIF first. CySEC accepts complaint information for supervision but states that it does not have restitution powers for individual complaints | Try the registered firm first. The SCB accepts documented complaints about matters including missing assets, misleading information and suspected breaches |
The surprising part: offshore does not mean “no CFD rules”
“Offshore broker” is too broad to be a useful verdict. It describes location more than substance. The Bahamas has specific CFD rules for registered firms. Those rules require a provider-specific risk warning, segregated retail CFD margin, a 50% margin close-out framework, negative balance protection and restrictions on retail incentives.
The difference appears in the details. The Bahamas rules set 0.5% minimum margin for the listed major currency combinations, which can permit much higher leverage than the 3.33% major-pair margin used in UK and Cyprus retail rules. Its close-out rule also allows the firm to request extra margin as an alternative to closing positions. Those are practical differences even though the headings “margin close-out” and “negative balance protection” appear in all three frameworks.
The lesson is not that one regulator is automatically safe and another is automatically unsafe. The lesson is to compare the actual rule text. A badge-only comparison would miss both the Bahamas safeguards and the higher leverage permitted under its current CFD rules.
The largest practical gap is often the remedy after something goes wrong
Retail trading protections govern how an account should operate. Compensation schemes and complaint bodies address different problems. They should never be combined into one vague “funds protected” claim.
UK: authorisation does not make every loss an FSCS claim
The FSCS says investment protection may reach £85,000 per eligible person, per firm when an authorised provider or adviser has failed. The firm, activity and product must fall within the scheme. Poor market performance is not itself an eligible claim. The FCA also warns that authorisation and correct permissions matter for access to the Financial Ombudsman Service and FSCS.
Cyprus: the ICF limit has its own calculation and conditions
CySEC describes the ICF as protection for eligible covered clients of fund members when the required conditions are met. Current CySEC information gives the coverage as the lower of 90% of the client’s cumulative covered claims and €20,000. That is not a balance guarantee and it is not compensation for an ordinary losing trade.
CySEC also makes an important distinction about complaints: it accepts complaint data as part of its supervisory role, but says it does not investigate individual complaints for restitution. A user should follow the firm’s complaint process and identify the redress route named in the applicable documents rather than treating a regulator report as a repayment request.
Bahamas: a regulatory complaint is not the same as a compensation award
The SCB asks consumers with a complaint against a registered securities firm to try resolving it with the firm first. Its complaint guidance then explains how to submit a documented complaint to the Commission. That can support regulatory investigation. It should not be presented as proof of a compensation fund or a guaranteed recovery route.
A five-minute test before you accept the account
- Find the contracting sentence. Search the application, client agreement and welcome email for “contract with,” “provided by,” “counterparty” or “issuer.” Record the complete company name and number.
- Search the correct official register. Use the company name or licence number, not only the brand. Confirm status, approved domain, permissions and contact details.
- Match the account classification. Retail, elective professional and institutional accounts can have different protections under the same entity.
- Record four operating rules. Save the opening margin, close-out trigger, negative balance clause and client-money statement that apply to your account.
- Separate complaints from compensation. Write down the firm’s complaints address, the relevant external dispute body or regulator, and the conditions of any compensation scheme.
- Add a check date. Save the agreement version, URLs and screenshots. A regulator entry or broker document can change after you open the account.
If the company in the agreement does not match the company you verified, stop. Do not send money until the broker explains the difference in writing and you can independently verify the answer.
Evidence record you can copy
| Evidence field | What to record |
|---|---|
| Brand searched | The public name used on the website or app |
| Legal entity | Full company name and registration number from your contract |
| Regulatory record | Regulator, licence number, status, permissions and approved domain |
| Retail safeguards | Leverage or opening margin, close-out trigger and negative balance wording |
| Failure protection | Scheme name, eligibility conditions and current limit, or “not independently verified” |
| Complaint path | Firm contact, required reference number, regulator or external dispute body |
| Version evidence | Agreement date, document version, source URL and check date |
You can work through these fields in the FXPEDIA360 Forex Broker Safety Guide, check a stored country-entity record with the free broker verification tools, or compare up to three brokers in the Broker Evidence Comparison Tool.
What this comparison cannot prove
- A regulator entry does not prove that every broker claim is accurate.
- Segregation rules do not remove market risk, operational risk or every possible shortfall.
- Negative balance protection does not stop the funds dedicated to a CFD account from being lost.
- A compensation limit does not mean every client, product, event or loss qualifies.
- A group licence does not automatically cover a contract issued by another company in the group.
Final rule
Do not ask whether the broker brand is FCA, CySEC or offshore regulated. Ask which legal entity will be your counterparty and what that entity’s current rules, compensation position and complaint route mean for your exact account.
The regulator logo is the start of the check. The signed company name is what turns that label into an evidence trail.
Official sources and verification log
- FCA: Contract for differences. UK retail CFD measures and regulator expectations. Checked 31 August 2026.
- FCA Handbook COBS 22.5. Margin close-out and negative balance protection rules. Checked 31 August 2026.
- FCA: How to check a firm is authorised. Register, permissions and consumer protection context. Checked 31 August 2026.
- FSCS: Investment protection. Eligibility context and current investment limit. Checked 31 August 2026.
- CySEC: Directive restricting CFDs for retail clients. Current consolidated directive displayed by CySEC. Checked 31 August 2026.
- CySEC: Investor Compensation Fund information. Covered-client conditions and compensation calculation. Checked 31 August 2026.
- CySEC: Complaint regarding CIFs. Supervisory complaint role and restitution limitation. Checked 31 August 2026.
- Securities Commission of The Bahamas: CFD Rules, 2020. Retail margin, segregation, close-out and negative balance rules. Checked 31 August 2026.
- Securities Commission of The Bahamas: Complaints. Firm-first and regulatory complaint guidance. Checked 31 August 2026.
- CySEC record for Pepperstone EU Limited. Company, licence and approved domain. Checked 31 August 2026.
- FCA warning identifying the genuine Pepperstone Limited details. FRN and authorised-firm identity. Checked 31 August 2026.
- Pepperstone legal documents. Primary company source explaining that documents vary by account entity. Checked 31 August 2026.
Educational information only. This article does not provide investment or legal advice, rate broker safety or guarantee that a regulator, ombudsman or compensation scheme will accept a claim.