Regulatory Licensing Check in Europe

What Is a Regulatory Licensing Check and Why It Matters

A regulatory licensing check is a direct verification of a financial operator’s claimed regulatory authorization against the primary licensing database maintained by the national competent authority responsible for that authorization.

Every EU member state maintains a financial regulator the FCA in the UK, BaFin in Germany, CySEC in Cyprus, AMF in France, AFM in the Netherlands, and equivalents across all 27 EU member states each of which maintains a primary register of the entities it has authorized to provide financial services in its jurisdiction. These registers are the authoritative source for authorization verification. Every authorization claim made by a financial operator is verifiable against that register and every discrepancy between the claim and the register record is a material finding.

For investors who have been approached by a European-licensed broker, investment platform, or financial advisor, the regulatory licensing check answers the most fundamental pre-investment question: is this entity actually authorized to do what it is offering to do? The answer to that question, from the primary database of the stated regulator, is the foundation on which every subsequent engagement decision rests.

What a Regulatory Licensing Check Covers

Our team verifies every material element of a financial operator’s regulatory authorization claim:

• Authorization existence confirmation – Confirming whether the entity holds a current authorization from the stated regulator directly against the primary licensing database
• Authorization scope verification – Confirming what the authorization actually covers the specific investment services, financial instruments, and client categories for which the entity is authorized and whether its offered services fall within that scope
• Authorization status assessment – Confirming whether the authorization is current and unrestricted, or whether it is subject to conditions, limitations, suspensions, or has been withdrawn
• Entity identity matching – Confirming that the entity presenting the authorization the company name, company number, and jurisdiction matches the entity to which the authorization was granted, identifying clone firm misrepresentations
• Passporting status verification – Where the entity claims to provide services in a jurisdiction other than its home state under EU passporting rights, confirming that the passport notification has been filed and accepted by the host state regulator
• Enforcement history review – Confirming whether the authorized entity has been the subject of regulatory enforcement action, public censure, or mandatory requirements imposed by the regulator
• Warning list and blacklist confirmation – Checking the entity and its principals against the regulatory authority’s published warning lists, unauthorized firm lists, and consumer alert registers

Scope of Services Within Regulatory Licensing Check Europe:

European Regulators We Check Against

Veritas Advisory Group s.r.o. conducts regulatory licensing checks against the primary databases of every major European financial regulatory authority applying the specific search methodology and disclosure framework of each regulator.

Investment Services and Securities Regulators

Crypto-Asset Service Provider Registers

Following the implementation of the EU Markets in Crypto-Assets Regulation, MiCA authorization registers are maintained by the national competent authority of each EU member state. Where an operator claims MiCA authorization or national VASP registration, we verify against the applicable national register including the ESMA central register of MiCA-authorized entities as it develops across EU member states.

ESMA European Securities and Markets Authority

ESMA maintains EU-wide registers for specific categories of authorized entity including UCITS and AIFMD-registered funds, trade repositories, and credit rating agencies. Where an investment operator claims authorization in a category covered by ESMA’s central registers, verification is conducted against those registers directly.

Authorization Misrepresentations That Licensing Checks Identify

Clone Firm Fraud

The most sophisticated form of regulatory misrepresentation a fraudulent operator that copies the name, registration number, contact details, and branding of a legitimately authorized firm, creating a parallel fraudulent entity that appears to have the same regulatory credentials as the genuine firm. Clone firm fraud is specifically identified through entity identity matching confirming that the entity presenting the authorization (its company number, registered address, and contact details) matches the entity to which the authorization was actually granted. The FCA alone issues hundreds of clone firm warnings annually the majority of which target Asian investors.

License Number Substitution

A fraudulent operator that presents a genuine license number from the regulatory register but attributes it to a different entity than the one actually holding it. The license number may be genuine belonging to an unrelated authorized firm in the same jurisdiction but the entity presenting it is unauthorized. Authorization existence confirmation without entity identity matching does not identify this misrepresentation. Our verification confirms both that the license number exists and that it belongs to the entity presenting it.

Scope Misrepresentation

A financial operator that holds a genuine regulatory authorization but for a narrower scope of activity than it is offering. For example, a firm authorized only to provide investment advice but offering discretionary portfolio management, or a firm authorized for institutional clients only that is soliciting retail investors. Authorization scope verification confirms what the authorization actually permits not what the entity claims it permits.

Lapsed or Withdrawn Authorization

A financial operator that presents credentials from a regulatory authorization that was genuine at one point but has since been withdrawn or surrendered either following regulatory enforcement action or after the firm ceased regulated activity. Authorization status assessment confirms the current status of every authorization specifically identifying those that have been suspended, conditioned, or withdrawn since the entity obtained them.

False Passporting Claims

A financial operator that claims to provide services across multiple EU member states under MiFID II passporting rights without having filed the required passport notification with the host state regulator. Passporting status verification confirms whether the passport notification exists and has been accepted identifying entities that claim EU-wide authorization they do not hold.

How Veritas Advisory Group s.r.o. Conducts Regulatory Licensing Checks

Our regulatory licensing check methodology is built around direct primary database verification applying the specific search protocol of each national regulator’s register to every element of the authorization claim.