To be honest they don't need CAA approval.
The way some of these companies work is train a student for an FAA PPL. They have on site a CAA approved examiner, who, when the candidate has passed the FAA PPL (examined by FAA DPE) carries out a "conversion to JAA" check flight. When they pass this they have a JAA PPL. CAA approval is not required for conversions, and they normally get around the ground exams by having the candidate do them in the UK at an APPROVED school or place before they arrive.
I can see nothing wrong with it myself, CAA approval costs thousands for essentially a jolly for an inspector and the candidate ends up with both FAA and JAA standalone tickets.