Investors should exercise caution when downloading unfamiliar trading apps or sending funds to personal, overseas, or cryptocurrency accounts.
Investor alerts about firms impersonating well-known exchanges are becoming increasingly common in the UAE, with official authorities cautioning potential investors to stay vigilant.
Recently, the UAE’s Capital Market Authority (CMA) warned investors against engaging with firms before confirming their licensing status. Earlier, on February 2, the CMA issued a warning about an unlicensed marketing firm, urging investors not to conduct any business with them.
In the UAE, any entity providing investment services, managing funds, or marketing financial products to the public is required to hold a valid license.
Scam Alert for Investors: How to Spot Unlicensed Firms in the UAE
Investor alerts about firms impersonating well-known exchanges are becoming increasingly frequent in the UAE. Authorities are cautioning the public to stay vigilant and avoid falling prey to scams.
Recently, the UAE’s Capital Market Authority (CMA) warned investors against engaging with firms before verifying their licensing status. Earlier, on February 2, it flagged an unlicensed marketing firm, urging investors not to conduct business with them.
In the UAE, any entity providing investment services, managing funds, or marketing financial products to the public must hold a valid licence. The CMA—formerly known as the Securities and Commodities Authority—regulates such activities on the mainland and recently updated its legal framework under new federal decree-laws, strengthening oversight and investor safeguards.
Start With the Regulator’s Register
The most important step for investors is to confirm that a firm is licensed. The CMA’s official website offers open data on licensed companies, including brokerage firms, investment managers, and financial advisers.
Before transferring funds or sharing personal documents, investors should carefully check the CMA’s public register to ensure the company’s name, licence number, and contact details match exactly. Scammers often mimic legitimate firms by changing a word or adding a suffix such as “Global” or “International.” Even small discrepancies in spelling, domain names, or email addresses can indicate impersonation.
Understand Which Regulator Applies
Each regulator maintains its own searchable database of licensed firms. Investors should always verify a company’s status directly through the official website, rather than relying on links or documents provided by the firm.
- The CMA oversees securities and investment activities on the UAE mainland.
- Dubai International Financial Centre (DIFC) firms are regulated by the Dubai Financial Services Authority (DFSA).
- Abu Dhabi Global Market (ADGM) entities fall under the Financial Services Regulatory Authority.
- Banks, finance companies, and insurance providers are licensed by the Central Bank of the UAE, which also regulates payment service providers and some digital payments.
- Virtual asset and cryptocurrency businesses in Dubai (outside the DIFC) are regulated by the Virtual Assets Regulatory Authority, making it crucial to verify crypto platforms’ licensing.
Be Wary of Pressure Tactics and “Guaranteed” Returns
Impersonating firms often rely on urgency and promises of high, “guaranteed” returns. UAE law prohibits misleading financial promotions and unauthorised investment activities. Any firm offering unusually consistent profits, risk-free trades, or exclusive time-limited opportunities should raise red flags.
Cold calls, unsolicited WhatsApp messages, and social media advertisements are common tools used by scammers. Investors should be cautious about downloading unfamiliar trading apps or sending funds to personal, overseas, or cryptocurrency accounts unrelated to a licensed entity.
Report Suspicions Promptly
Both the CMA and DFSA encourage the public to report suspected scams or unauthorised activities. Early reporting protects individual investors and helps regulators issue warnings and take enforcement action more quickly.
