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How to check if a company is legit, UK regulations, and how to avoid risking your money and data

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Written by Dan Base, Financial Content Writer

27 December 2018

If you are worried about the authenticity of a company, it is always worth doing some research. We look at how to check if a company is legit, UK rules, and how you can find out whether to trust a company or avoid them at all costs.

When you buy something from a company you have never heard of, it is sensible to find out as much about them as you can.

After all, con artists use fake companies to make their scams look more real, and you do not want to be duped if you can help it.

Remember...

It pays to have a healthy sense of suspicion when you make a purchase or give a company your details, whether online or on the high street.

It is also a good idea to pay for anything you buy with a credit card. That way, a dodgy company would not be able to clear out your bank account.

Here is how Section 75 protects your credit card purchases

Here is how to check if a company is legit:

1. Check for concrete details

One of the easiest ways to spot a fake company is if you cannot see any evidence that they exist in reality.

The first thing you should do is check that the company you are dealing with has a physical, concrete location somewhere in the world.

Look for a physical address on the company's website. If this physical address is a registered office, even better.

Check their website for a phone number - preferably a landline number - then call this to see who answers.

  • If an employee of the company in question answers the call you can have some reassurance that you are dealing with a "real" company

  • If no-one answers or you are put through to an anonymous call centre, this may be your first warning sign that the company is not legit

2. See what others say

Using a search engine like Google can give you all sorts of information on a company, including what people are saying on forums and social media:

  • If someone speaks of a bad experience with the company or warns against dealing with them, you will know to steer clear

  • Equally, this may bring back results where the company is shown in a good light, which will encourage you that they are a legitimate firm

Googling a company is a good way to get to know more about who they really are behind their superficial image.

Remember that what is said on forums is not gospel but it can act as a useful indicator when you are not sure about a company.

Check a company on Google

3. Search the FCA register

If you are looking at a company that deals in financial services or products, there is one simple way to check out their credentials: look them up on the Financial Conduct Authority (FCA) register.

The FCA register is a comprehensive database holding details of every financial company who are registered and regulated by the FCA.

If a financial company is not on the FCA register, you should avoid them. You can search for a company by entering their name and/or postcode.

Another good resource is the UK government's Companies House website. You can use this site to perform a search of all 2 million+ limited companies trading or once registered in the UK and listed in Companies House.

Search the FCA register

Search the Companies House website

4. Check out their website

Look for specific things on the company's website that may give away whether or not they are truly legitimate:

  • If you notice poor English used frequently on a website that appears to be trading as a UK company, the company may be based overseas.

  • Check if the website lists any testimonials from satisfied clients or customers. Make sure they sound genuine and not formulaic.

  • You should also look for a privacy policy and company history on the site - this may state how long the company has been in operation, their ethical stance, and their mission statement.

  • If you are going to purchase something online, always check the company's refund and exchange policy so you know there are steps you can take if the goods do not materialise.

  • Finally, before you even consider entering your payment details, it is vital that you check for "https://" at the start of the url and that a padlock or key symbol is displayed in your browser.

5. Don't take any risks

If you're thinking about how to find out if a company is legit, it is likely you have already spotted some warning signs. Sometimes it is best to simply go with your gut feeling about a company.

If you have any suspicions, you are not confident in how to check if a company is legit, or you are uncomfortable dealing with the company, walk away and take your business elsewhere. It is better to be safe than sorry.

6. What to do if you get scammed

If you think you have been scammed, tell your bank immediately. They can increase security on your current account to prevent further money being taken.

You should also report details of the crime to Action Fraud, either via their website or by calling 0300 123 2040.

Here is what to do if you think you have been scammed

Spending with a credit card offers extra protection from scammers and fraudsters with Section 75 cover. Compare credit cards to find one that suits how you spend.

Compare credit cards

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