Contracts for Differences or CFDs are complex financial products used to speculate on the movement in prices on a wide range of assets. As a result, they carry a considerable risk of substantial losses. 

Indeed, the FCA recently issued a warning to investors in CFDs against giving up vital consumer protections. The FCA is concerned that firms are using high-pressure techniques to encourage investors to claim they are professional clients, putting them at risk of losing more money than they can afford. According to the FCA, the retail client protections, including leverage limits and client loss protections, prevent nearly 400,000 people a year from risking more than their original stake in CFDs and provide between £267 million and £451 million worth of protection.

The FCA has also found investors are being targeted by finfluencers, who may not make it clear that they are promoting unregulated firms operating offshore. Some of these finfluencers promise consumers unrealistic returns if they copy trades, invest in managed accounts or pay for daily trading tips. The FCA says that more than 90,000 people have lost around £75 million over a four-year period in this way at just one firm.

In June 2025, the FCA led an international crackdown on illegal finfluencers that resulted in three arrests, seven cease and desist letters and 50 warning alerts being issued.

Review of providers under Consumer Duty

Under the Consumer Duty, CFD firms must ensure the price that a consumer pays is reasonable compared to the overall benefits they can reasonably expect to receive. The FCA carried out a review of CFD providers which assessed how a range of large and small firms delivered fair value, including how costs and charges were disclosed.

Now the FCA has warned CFD providers to provide fair value, after the review found some firms were not complying with the Consumer Duty. 

The Duty was introduced in July 2023 and set a higher standard for consumer protection in financial services. Fair value is about more than just price. The Duty addresses other factors that can result in products or services providing poor value, such as unsuitable features that lead to foreseeable harm or frustrate a retail client's intended use of the product or service.

The FCA's review found some examples of good practice, including firms simplifying fee structures and stopping investors who might not be able to shoulder losses from buying CFDs in the first place. However, the FCA's review found room for improvement, including where firms were:

• not adequately considering consumer complaints or customer satisfaction as part of their fair value assessments;
• making little or no changes to their products or services in response to the Consumer Duty;
• applying varying levels of overnight funding charges without providing clear justification – the potentially significant charges often were not adequately disclosed; and
• charging overnight funding separately on matched long and short positions, incurring potentially significant ongoing charges with little benefit for the consumer.

Where necessary, the FCA will engage directly with firms included in this review to drive improvements. It will also consider further work to address the issues identified. The FCA will act against any firms and individuals that fail to meet required standards.

In the coming months, the FCA will consult on client categorisation to make sure that the right protections apply for the consumers who need them and create more freedom for those professional investors who don't.