Operator community must unite to fight fraud

Written by on November 5, 2015 in Guest Blog with 0 Comments

Money Bag.Telecoms fraud is arguably one of the most disruptive events in the communications arena. A problem spanning the whole industry, the operator community loses hundreds of billions of euros every year at the hands of opportunistic criminals.

The service provider impact is not just a financial one, but also reputational, as their customers have been feeling the effect through traffic quality degradation, traffic congestion caused by a high volume of fraudulent activity on the network and unexpectedly high invoices.

Fraud comes in multiple forms, with international fraud types becoming increasingly prevalent. In recent months, BICS’ partners have reported a rapid increase in weekend roaming fraud attacks causing losses of over €400,000 in just 2 days.

Roaming fraud is a popular outlet for criminals as it is an area where operators tend to be highly exposed, due to the time it takes to detect compared to domestically originating frauds. In most cases, by the time roaming fraud is detected, a few hours of traffic have already passed through the network often leading to significant revenue loss.

The majority of telecoms fraud is still based around voice services such as International Revenue Share Fraud (IRSF) and Wangiri. IRSF sees criminals establish international numbers and use a variety of methods – including PBX hacking, SIM card cloning, international roaming fraud and subscription theft – to artificially inflate traffic to these numbers. Wangiri sees customers persuaded to call premium rate numbers after receiving an automated missed call or being spammed by SMS. Wangiri cases related to OTT services are now also coming to the fore.

Fraud aimed at mobile carriers is not a new problem, although the true scale of the problem is still uncertain with operators not detecting all instances and reluctant to part with details of attacks to their competitors, investors and customers.

Traditional methods of defence have revolved around post-facto solutions that fix the cause of the problem after an attack. Whilst that may prevent future revenue loss through exactly the same channel, the revenue from the initial attack is sacrificed.

The key to tackling fraud is the ability to act proactively rather than reactively. As with any criminal activity, protecting from the initial threat is much more cost effective than post-attack measures deployed in an attempt to repair damage and recoup lost revenue. This has been recognised through the formation of a number of specialist industry groups looking at the specific issue of telecoms fraud and outlining best practice in revenue protection methods, including the GSMA’s Fraud and Security Group and i3 forum Fraud WorkStream, the latter focusing on the issue from a wholesale perspective.

The move to all-IP networks has changed the fraud landscape with an increasing amount of equipment IP-enabled and ‘accessible’ to fraudsters to perpetrate voice fraud. By using a crowdsourcing fraud platform, service providers are able to monitor the most prevalent fraud schemes in the industry and protect against them.

New fraud variants are being developed and exposed in the industry all the time and operators are finding their best defence is to work collaboratively on preventing this revenue loss.

Wholesale carriers are in the ideal position to monitor telecoms fraud attacks and analyse anonymised data from incidents around the world. By sharing data from these attacks (both successful and attempted), operators around the world can proactively protect themselves against current threats being experienced by other operators, and confront fraudulent activity and revenue loss head on.

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Katia González

About the Author

About the Author: Katia is Head of Fraud Operations and Services at BICS, a leading global wholesale carrier in the Telecom industry. With more than 11 years of experience in the Mobile and Wholesale Telecom industry, Katia also chairs the i3 Forum Fraud WorkStream, which brings together the communications expertise of more than 50 telecommunication providers, representing a combined retail base of over 1.5 billion customers across 100+ countries. .

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