Telecom Fraud – industry’s problem not the customer’s

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Industry needs to take ownership of telecom fraud says VanillaIP CEO Dave Dadds

The ongoing “quiet” debate about telecom fraud which for the Voice Carriers and Resellers in the UK typically shows itself in the form of “dial through fraud” is a continued ongoing discussion, but the truth is that it is everyone’s dirty secret.

We all know the ways dial through fraud typically happen by either the PBX being hijacking or impersonating the SIP credentials, then big bills being sent all the way down the chain typically ending up on the customer doorstep.  

The first thing I would say is this is not an end user problem, why should the customer be expected to know the inside out of the black magic art of telecoms to somehow work out how to stop it? If the banks turned around to us and told us all that our next credit card fraud is our problem to sort we would rightly tell them where to go.  No, this problem is for the industry to sort out and get its house in order and start spending the money to resolve the problem. It would also help if our regulator Ofcom took more interest in this issue rather than just passing the buck.

Why this is everyone’s “dirty secret” is because no vendor is keen to talk about how much they have been hacked for as they see it as a loss of face and a reflection of weakness in there system. This in itself means that the problem is being tackled with one hand behind everyone’s back.  The other major issue which does not always get asked is where exactly this money is being sent?  

Various stats are given as to how much this fraud is worth worldwide, millions, billions, trillions who knows but the key question is are we all funding ISIS?.  When this possibility is put in the ring this becomes not just a commercial concern for all of us but just as importantly a moral concern with the recent tragic incidents around the world including Paris.

The industry needs to get its act together and tackle the problem head on. Anyone that is running a SIP based network service these days will no doubt be putting their own preventative measures in place but the biggest leak in all of our cumulative “Buckets” is the fact that the large carriers continue to be happy to pay the out payments with NO questions asked.  If UK based carriers refused to pay their international partners this fraud would soon start to be stopped, we saw the change in the UK fraud market once out payments could be withheld for UK routed 09x, 08x and 070x numbers.  We ourselves today at VanillaIP see very little attempted fraud to UK numbers as there is no financial incentive, what a surprise!

As an industry we need to be putting a much brighter spotlight on the subject, we must all be prepared to talk openly about this problem and share best practice.  Both FCS and ITSPA have been working on strategies to help resolve this problem and we could all start by reporting all frauds through https://app03.actionfraud.police.uk/report/Account which is a website run by the City Of London Police and the National Fraud Intelligence Bureau.   We should push for greater engagement with the large carriers and the regulator as this is everyone’s problem. In reality there is absolutely no reason why we can’t resolve this to the benefit of everyone apart from the criminals and terrorists out there.

Dave Dadds ([email protected]) – is CEO of VanillaIP.com and Deputy Chairman at FCS

This is telecom fraud week on trefor.net, edited by Manuel Basilavecchia of Netaxis. Read our other fraud posts this week:

Colin Duffy on “is encryption the answer to data loss
Manuel Basilaveccia on “Missing Trader VAT Fraud

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