Misuse of license Claims & False Representation
This guidance explains how license claims must be presented, how misuse is assessed, and how third parties should verify claims using the public register. It also sets out reporting expectations where false representation is identified.
Purpose of This Guidance
This document is issued to protect the integrity of the licensing framework and to support reliable verification by banks, payment service providers, counterparties, professional advisers, and the public. It explains how license claims should be made, what constitutes misuse, and the appropriate response where false representation is identified.
What Is a license Claim?
A license claim is any statement, implication, or representation that an entity is licensed, authorised, approved, overseen, or otherwise recognised by the Authority. license claims may appear in websites, marketing material, proposals, contractual documents, client onboarding flows, social media, email signatures, and sales scripts.
What Constitutes Misuse or False Representation?
Misuse occurs where a license claim is false, misleading, overbroad, or presented in a way that could reasonably cause a third party to misunderstand the entity’s status or scope of permission. Misuse is assessed by substance and likely impression, not by wording alone.
- Claiming to be “regulated” or “fully licensed” without stating the authorised activities
- Using a license to imply permission for activities not authorised (scope inflation)
- Representing an affiliate, group company, or brand as licensed when only one legal entity is authorised
- Presenting a suspended, expired, or revoked license as active
- Using the Authority’s name, crest, seal, or register references in a way that implies endorsement
- Marketing a product line that is not reflected in authorised activities
- Operating execution, dealing, or custody-like functions under an intermediary-style permission
- Offering “client fund handling” or “safekeeping” representations where no such permission exists
- Using generic license language in contracts that does not match register scope
Register Precedence and Verification
Verification must be conducted using the public register entry for the legal entity making the claim. Where a claim conflicts with the register, the register prevails for verification purposes. Third parties should confirm:
- The legal name matches the register entry
- The license status is active and current
- The authorised activities align with the services being offered
- Any limitations or conditions are understood and respected
Use of the Authority Name, Crest, Seal, and References
The Authority’s name, crest, seal, and register references must not be used in a manner that implies sponsorship, partnership, endorsement, or guarantee. Where limited reference is permitted (for example, factual statements), it must be accurate, scoped, and verifiable.
Entities must not reproduce the crest or seal for promotional purposes, including placement on websites, certificates, or advertising materials, unless explicitly authorised in writing under an applicable policy.
Expected Corrective Action
Where misuse is identified, entities are expected to take prompt corrective action. Corrective action typically includes:
- Immediate removal or amendment of misleading claims and visuals
- Alignment of website, marketing, contracts, and onboarding language with register scope
- Internal controls to prevent recurrence (approval workflow for claims)
- Where necessary, submission of a variation request before expanding activity
Reporting a Suspected False license Claim
Banks, payment service providers, counterparties, and members of the public may report suspected misuse of license claims. Reports should include sufficient evidence to identify the representation and the entity involved.
- Website links and dated screenshots
- Copies of marketing material, proposals, or agreements
- The claimed legal name, trading name, and any reference number used
- Description of the service being offered and why the claim appears misleading
- Use the Authority’s official contact channels as published on the Contact page
- Where immediate risk exists, counterparties should also apply their internal escalation procedures
Conclusion
Accurate license claims support market clarity and reliable verification. Misuse of license claims undermines trust and may result in supervisory engagement or administrative action. Entities are expected to ensure that all public and contractual representations are accurate, scoped, and consistent with the public register.