Spread betting companies are regulated in the United Kingdom by the FCA and comply with UK laws.
Spread betting providers are obliged to hold all retail customer funds in segregated trust accounts with FCA approved banking institutions, established, maintained and operated in accordance with UK Client Money Rules. This segregated model should theoretically mean that all retail client monies, including client margins, are 100% segregated. It also means that spread betting providers should not utilise retail client money to hedge provider’s positions or to meet the trading obligations of other customers.
In practice in the unlikely scenario that a provider were to go into liquidation AND there was to be deficiency in the client money bank account, individual clients are covered by the Financial Services Compensation Scheme (FSCS). The maximum FSCS payout per client if a company goes into administration is £50,000.