TYPES OF TELECOM FRAUD

Telecom fraud is a fast-growing field of criminal activity and a low-risk alternative to traditional methods of financial crime and is a serious threat to the telecoms industry.

The Impact

Telecom fraud is a fast-growing field of criminal activity costing the industry upwards of $32 billion dollars a year. Considered by criminals as a low-risk alternative to traditional methods of financial crime they continue to think of new ways to scam and prey upon consumers and the communication networks they depend upon. Here at Squire Technologies we help telecoms operators combat the fraudsters with innovative fraud prevention product solutions that rapidly identify and stop network fraud in real-time.

  Type of Fraud Subscriber Impacts Operation Impacts
  Voice fraud SMS fraud IPX fraud Signalling fraud Billing shock Customer churn Privacy breach Revenue loss Customer experience Industry ties
Bypass Fraud x x     x x   x x x
Leaky PBX x       x x x x x x
SIM Box Fraud x x     x x   x x x
Smishing Fraud   x     x x x  x x x
CLI Spoofing Fraud x x x x       x x x
Wangiri (One Ring and Cut) Fraud x       x  x     x  x x
SIM Swap Fraud x x          x  x  x x 
IRSF International Revenue Share Fraud x x           x  x  x 
Boomeranging x       x x x x x x
Over-the-top (OTT) Bypass Fraud x           x x x x
Call Forwarding/Diversion Fraud x         x   x x x
Call Transfer Fraud x         x   x x x
Multiple Call Transfer Fraud x         x   x x x
CDR Manipulation x x x x x x   x x x
False Answer Supervision (FAS Fraud) x       x x   x x x
Interconnect Fraud x x     x x   x x x
Inter-/Inra-state toll Bypass Fraud x x     x x   x x x
International NANPA Fraud x       x x   x x x
Toll Free Fraud x             x x x
Wholesale SIP Trunking Fraud x       x x x x x x
Traffic Pumping/Access, Stimulation Fraud x                  
Location Routing Number (LRN) Fraud x         x   x x x

Telecom Fraud

Leaky PBX

Leaky PBX is the name given to the practice of using a local PBX to leak calls from country A into the network in country B, disguising them as local calls. It receives the calls on its PBX in country A, sends them over a satellite link, dedicated telephone circuit or data link to country B, and sends the calls out into the public telephone network of country B through its PBX there. With a small satellite dish on the roofs of its offices in country A and B and a little capacity on a transponder, a company can become a small-scale international carrier. 


Boomeranging

Boomeranging is the “Hijacking and unauthorized use of IP-PBX (News - Alert) bandwidth to rebroadcast data.


Over-the-top (OTT) Bypass Fraud

This type of fraud usually happens in mobile-to-mobile calls, where the fraud is perpetrated during the interception and redirection of the call that originated in the legitimate mobile network, into the wholesale/interconnect network without the subscriber's consent.


Call Forwarding/Diversion Fraud

Call Forwarding/Diversion Fraud is where a fraudster tricks a subscriber into call forwarding their number to either a long-distance number or a number at which the fraudster or an accomplice is accepting collect calls.


Call Transfer Fraud

Call transfer fraud happens when someone hacks into a VoIP PBX to make free international calls. The hacker usually has its own VoIP service in some other country. When a subscriber to the fraudulent service makes a call to an international destination, the call travels through the compromised PBX.


False Answer Supervision (FAS Fraud)

False Answer Supervision (FAS) refers to VoIP fraud when A-party is incorrectly billed: billed duration is more than the duration of an actual telephone conversation. The FAS is usually performed by VoIP wholesalers in their softswitches for randomly selected calls.


Inter-/Inra-state toll Bypass Fraud

Bypass fraud is the unauthorized insertion of traffic onto another carrier's network. Inter/Intra State toll bypass fraud attempts to bypass the higher tolls of inter-state traffic by making it look like intra-state traffic.


International NANPA Fraud

Some countries in the Caribbean have what appear to be North American telephone area codes (with the Bahamas having an area code of 242 and the Cayman Islands having an area code of 345), a rather common telephone area code fraud is to fool people into calling these numbers even though they believe that they are telephoning the United States or a Canadian jurisdiction where fraud laws apply. The unsuspecting target often faces not only large telephone bills but also invoices for products or services that are fraudulent.


Toll Free Fraud (IRSF)

International revenue sharing fraud (IRSF), also known as toll fraud, is a scheme where fraudsters artificially generate a high volume of international calls on expensive routes. Fraudsters make calls to what is known as premium-rate numbers and take a cut of the revenue generated from these calls.


Wholesale SIP Trunking Fraud

Fraudulent wholesale SIP trunking is an emerging fraud type where fraudsters make money by selling wholesale trunking services or using stolen credentials to terminate the calls.


Traffic Pumping/Access, Stimulation Fraud

Toll-Free Traffic Pumping, also know as “Access Stimulation” or “Call Pumping”, is a sophisticated form of Toll Call Fraud in which 1-800 numbers are flooded with bogus calls.


Location Routing Number (LRN) Fraud

Location Routing Number (LRN) fraud works based on the desire of some service providers to avoid extra charges from LRN dips. Fraudsters who take advantage of this will insert fake LRNs into their calls. For example, they may insert the LRN for a relatively cheap terminating destination, whilst the call is actually a high-cost rural destination. The service provider then bills the fraudster for the cheaper call but will have to endure the cost of the more expensive rural call. In some cases, this can be up to five times the price they billed the fraudster.

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