Are Prop Firms Legit? How to Check a Firm (2026)

The short version

You're buying an evaluation of simulated trading, not opening a brokerage account. FTMO says all accounts it provides are demo accounts with fictitious funds.
Passing is the exception. Topstep's own 2025 numbers: 16.8% of Trading Combines were passed, 33.3% of traders at the Funded Level got a payout, and 0.71% of Express Funded traders were called up to a Live account.
A firm that publishes its drawdown, consistency and payout rules before checkout gives you something to hold it to. Read them first.
If a firm says it's regulated or registered, check it on the CFTC's own lookup. FTMO, for one, says its companies don't act as a broker and don't accept deposits.
The CFTC's 2023 case against My Forex Funds alleged $310 million in fees against about $137 million paid out. In 2025 a court report described bad faith conduct by the CFTC itself in that case.

Prop Desk doesn't rate or recommend firms. This page lists checks you can run yourself, and every fact on it comes from the source named. Not legal advice.

What you're actually buying

A prop firm evaluation is a product you buy. You pay a fee, trade a practice account under the firm's rules, and if you pass you get a "funded" account. The evaluation is simulated trading, and at many firms the funded account is too. The money you pay is a fee, not a deposit you can withdraw.

FTMO says it in plain words on its home page: "all accounts we provide to our clients are demo accounts with fictitious funds and any trading is in a simulated environment only." It adds that "FTMO companies do not act as a broker and do not accept any deposits." Topstep's market data article refers to its accounts the same way: "Level 1 is free for all simulated accounts including the XFA" (its Express Funded Account). Only a small share of Topstep traders move on to a live account, as the numbers below show.

So "is it legit?" really breaks into smaller questions you can check: Does the firm say clearly what you're buying? Are its rules written down before you pay? Does it pay the way those rules say? Who is the company behind it, and how has it treated traders when it changed the rules?

What one firm's own numbers show

Topstep, January to December 2025	Share
Trading Combines started that were passed	16.8%
People who passed at least one Combine	51.8%
People at the Funded Level who got a payout	33.3%
Express Funded traders called up to a Live Funded Account	0.71%

From Topstep's "2025 Trader Performance Statistics" on its own site. Topstep says the Funded Level counts Express and Live Funded Accounts together, and that the numbers "reflect performance in both a simulated trading environment and a live trading environment and are not indicative of future results."

Read together: about 1 in 6 Combines was passed, though about half of the people who entered got through at least once. Of the people who reached the Funded Level, one in three was paid. Fewer than 1 in 100 Express Funded traders moved to a live account.

These are one firm's numbers, published by the firm. They are the kind of figures worth asking any firm for before you buy.

Eight checks before you pay

The rules are written down before checkout. Drawdown type, daily loss limit, consistency rule, contract limits, news rules and inactivity rules should all be in the firm's help center or terms, not only in a Discord message. Our rules pages, like Topstep's, show what a complete set looks like.
The payout policy is specific. Look for the split, how many winning days you need, the cap per payout, any buffer you must keep, and how you get paid (bank transfer, Rise, Plane and so on). Vague words like "at our sole discretion" next to payouts deserve a second read.
You can see who you're paying. The terms of service should name the legal company, its address and the law that governs the contract. If you can't find a company name, ask before you pay.
The site says plainly what is simulated. FTMO's disclosure above is the clear version. If a firm talks about "real capital", find where it explains which stage, if any, trades a live account.
Any registration claim checks out. The CFTC says to verify registration before you work with anyone to trade futures, and that registration is handled by the National Futures Association. Its lookup is at cftc.gov/check. The CFTC also keeps a RED List of foreign firms that appear to need registration but don't have it.
The firm has a track record you can read. How long has it been selling evaluations? Has it changed rules for people who had already bought? Our news log and monthly rule change report record every confirmed rule change and closure across the firms we track.
You know what happens when rules change. Check whether the terms let the firm change its rules, whether changes apply to accounts you already own, and how much notice it gives.
Proof is something you can check. Payout screenshots and testimonials can't be verified. The CFTC warns the public to watch for "fake testimonials and so-called trading experts on social media platforms."

Red flags

Guaranteed funding or profits. The CFTC's fraud advisory is blunt: "No trading system can guarantee profits!"
Rules you can only find after paying, or rules that live only in a chat server.
No company name, address or governing law anywhere in the terms.
A claim to be "regulated" that doesn't match what the regulator's own lookup shows.
Payout rules full of discretion, such as broad "prohibited strategy" clauses with no examples.
Recent rule changes applied to accounts people had already bought. Check the firm's profile and our news log.

These are warning signs, not proof of wrongdoing. Weigh them together.

What the My Forex Funds case shows

In August 2023 the CFTC sued Traders Global Group, which did business as My Forex Funds. Its complaint alleged that more than 135,000 customers paid at least $310 million in fees, and that the firm paid out about $137 million, mostly as purported trading profits. It alleged that customers traded against the firm in an electronic environment the firm controlled, so that "any 'profits' to which the customer may be entitled come out of Traders Global's pocket."

Those were allegations. On May 13, 2025, the CFTC's acting chairman issued a statement on a court report recommending sanctions against the CFTC itself, saying the report described "willful and bad faith conduct" by the agency, including "multiple false statements to the Court."

Two things to take from it. First, on a simulated account, payouts come from the firm, not from the market, so a firm's ability to pay depends on its own finances. Second, a lawsuit or a regulator's headline isn't the end of the story. Read what was alleged, what was found, and what the firm's written rules say.

How Prop Desk helps you check

Prop Desk doesn't rate firms or call any firm legit. What we do:

Every firm profile shows prices, drawdown and payout facts read from the firm's own site, with the date we last checked.
Our rules pages quote each firm's help center on payouts and consistency, with links to the source pages.
Every rule change and closure goes in the news log only after it is confirmed on the firm's own site, help center, X account or email.

How we check is on our editorial standards page.

Questions

Are prop firms legit?

Some firms publish their rules up front and pay traders under them; Topstep says 33.3% of its traders at the Funded Level got a payout in 2025. But you are buying an evaluation of simulated trading, not opening a brokerage account, so check the rules, payout policy, company and track record of each firm before you pay.

Are prop firm accounts real money?

Usually not. FTMO says all accounts it provides are demo accounts with fictitious funds. Topstep's statistics cover both simulated and live trading, and 0.71% of its Express Funded traders were called up to a Live Funded Account in 2025.

What percentage of traders pass a prop firm evaluation?

Topstep publishes its own figures: in 2025, 16.8% of Trading Combines started were passed, and 51.8% of people who tried passed at least one. Ask any firm you are considering for its own numbers.

Are prop firms regulated by the CFTC?

The CFTC says entities that solicit you to trade generally have to register with it, and it runs a lookup at cftc.gov/check. FTMO says its companies do not act as a broker and do not accept deposits. If a firm claims to be registered or regulated, check that claim yourself.

What happened with My Forex Funds?

The CFTC sued it in 2023, alleging customers paid at least $310 million in fees while the firm paid out about $137 million. In May 2025 the CFTC's acting chairman responded to a court report recommending sanctions against the CFTC for bad faith conduct in the case.

Does Prop Desk rate prop firms?

No. Prop Desk publishes facts read from each firm's own pages, with the date checked, and logs confirmed rule changes. We do not rate, rank or call any firm legit.

Sources

Read on Nov 4, 2026:

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