Are client funds protected by FSCS at UK brokers?
Verdict
- Yes, for eligible clients: Pepperstone, our top pick, states that UK clients of Pepperstone Limited are covered by the FSCS up to £85,000, on top of client money held in segregated accounts at top-tier banks.
- FSCS compensation is a backstop if the firm fails; it never covers trading losses.
- Cover depends on the company you contract with: Pepperstone's German entity points to the EdW (90%, up to €20,000), its Cyprus entity to the ICF, and its Australian and Bahamas entities name no compensation scheme.
- Before you deposit with any UK broker, confirm the contracting company on the FCA register and read its client-money page.
FSCS protection is the reason many UK traders insist on an FCA-authorised broker. Pepperstone states it plainly for its UK clients; below is how the cover fits together with segregation, and what changes if you end up with a non-UK entity.
FSCS cover at Pepperstone UK
Pepperstone's UK protection page says client funds are held in segregated accounts with top-tier banks and that eligible clients are covered by the Financial Services Compensation Scheme up to £85,000. That applies to accounts with Pepperstone Limited, authorised by the FCA under reference 684312, which is the company serving UK residents through pepperstone.com/en-gb.
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What happens to my money if a UK broker goes bust?
Two layers matter. First, segregation: client money is held in accounts kept apart from the broker's own money, so it is not meant to be used to pay the firm's creditors. Second, compensation: if a shortfall remains and you are an eligible client, the FSCS can pay compensation up to the published limit, which Pepperstone gives as £85,000. What neither layer does is restore money lost on open trades before the failure. Negative balance protection, separately, means a retail account cannot end below zero.
Why the contracting entity decides your cover
Pepperstone runs several regulated companies, and the scheme depends on which one holds your account. A UK resident signing up through the UK site gets the FCA entity; it is worth confirming that in your client agreement.
| Pepperstone entity | Regulator | Compensation published |
|---|---|---|
| Pepperstone Limited (UK) | FCA 684312 | FSCS, eligible clients up to £85,000 |
| Pepperstone GmbH (Germany) | BaFin | EdW: 90% of claims, up to €20,000 |
| Pepperstone EU Limited (Cyprus) | CySEC 388/20 | ICF: lower of 90% or €20,000, retail only |
| Pepperstone Group Limited (Australia) | ASIC AFSL 414530 | None named |
| Pepperstone Markets Limited (Bahamas) | SCB SIA-F217 | None named |
Checking FSCS cover at other UK brokers
Our data confirms the FSCS figure for Pepperstone only; the other UK brokers we cover publish their FCA numbers, but we have not verified their compensation pages. Do it yourself in a few minutes:
- Find the company that will hold your account, for example Capital Com (UK) Limited (793714) or IG Markets Ltd (195355).
- Look it up on the FCA register and confirm the firm reference matches.
- Read the broker's client-money or 'how we protect you' page for FSCS wording.
- Avoid professional-client status unless you understand which protections you give up.
Sources
Compensation details as published by Pepperstone's entities.
Does the FSCS cover trading losses?
No. The FSCS can compensate eligible clients if an authorised firm fails and cannot return their money. Losses on your own trades are not covered.
How much does the FSCS cover at Pepperstone UK?
Pepperstone says eligible clients are covered up to £85,000. Check the FSCS rules for which clients count as eligible.
Are segregated funds the same as FSCS protection?
No. Segregation keeps your money apart from the broker's own funds; FSCS compensation is a separate scheme that may pay out if money is still missing after a firm fails.
Spread bets and CFDs are complex instruments and carry a high risk of losing money rapidly because of leverage. 73.6% of retail investor accounts lose money when trading spread bets and CFDs with Pepperstone Limited. Consider whether you understand how these products work and whether you can afford to lose your money. This page is general information, not investment advice.