As the technology powering smartphones has developed over the years, unfortunately so has the range of telecom fraud activities looking to exploit networks and customers. Telecom fraud is nothing new, it has however seen an increase in recent years. In fact, according to carrier T-Mobile, the number of common telecom frauds was up by 116% in 2021. Although many people can recognise the signs of an attempted scam, the evolving nature of the tactics used by fraudsters has led to many being caught out.
It has been calculated by Action Fraud the average person in the UK could lose up to £300 of personal finances as a result of telecom fraud. This however could be a lot more, with the total losses within the UK stretching into the millions. It’s not only consumers that are suffering. The telecoms industry can suffer losses stretching into the billions each year, due to fraudulent calls or scams.
The types of telecom frauds are vast and often target multiple parts of a company’s infrastructure, making them difficult to detect in outdated or disconnected systems. Subscriber fraud has become a serious concern to many telecoms, as the products or services gained are often found to be linked to more serious offences, such as organised crime or terrorist networks. By using fraudulent details, scammers are also able to take out contracts with the aim of reselling devices, while a telecom is forced to wipe off the bad debt.
Telecoms are not only venerable during the onboarding of new customers. Fraudsters are also able to take advantage of the services offered to customers. A common telecom fraud is to set up premium phone lines which are then dialled by unsuspecting businesses or members of the public. They often only know a scam has taken place until they receive the bill. It is estimated this exercise can cost the industry between $4 to $6 billion a year. SMS messaging can also be highjacked for nefarious means. Scammers will send out SMS messages on mass with the hope of obtaining personal details from a handful of unknowing recipients.
The ability of scammers to use a networks service for fraud is a concern for telecoms due to the worry that by not providing suitable they will damage consumer confidence and long-term customer relationships. One of the most common telecom frauds affecting customer's experience is the use of robocalls, in which a computerized auto-dialer is used to call a list of numbers. It will then deliver a prepaid message, often in the hope of getting the victim to unknowingly call back a premium telephone number. A recent variation of this scam is to use a localised number and let the phone ring once before hanging up, in the hope that due to curiosity the victim will call back.
In recent years scammers have also used mobile phones to conduct scams in which they pose as legitimate businesses that are contacting clients. Amazon suffers greatly from this type of scam. A customer would receive an automated call claiming to be from Amazon, asking them to call back due to a problem with their account. If they did call back, they would be put through to a call centre where someone pretending to be from Amazon would threaten to close their account if they didn’t resolve the issue. The scammer would then claim that the issue could only be resolved by handing over personal bank details, which they could then use.
Within the UK the Royal Mail also suffered with scammers taking advantage of telecom services to mass message consumers. They would claim the victim had missed a delivery from the Royal Mail and needed to pay a £2 fee to get the item redelivered or risk having it returned to sender. The message would include a link, through which the victims could pay the £2 fee, meaning that not only did the scammers get the money, but they would also now hold the card details of the victim. This results in longer-term problems as fraudsters retargeted victims with the details they had handed over.
Mobile phone consumers have also been increasingly exposed in recent years to scammers planting malicious code onto their devices. This is often done through fake technical support scams. In this scam, fraudsters would call customers claiming there was a fault on their device, often mobile phones or tablets and encourage them to download a piece of software to fix the issue. The software would in fact give the scammer access to the device and allow them to access and download their personal data.
While the technology within our smartphones keeps evolving, so will the tactics used by scammers to steal personal details and finances. It is therefore vital to deploy the right fraud management in telecoms, to protect the organisation and their customers against fraud.
Lifecycle’s ALLinOne Event Intelligence Module utilises predictive analytics and real-time decision to monitor the activity of every subscriber to your network. By using directive workflows, Event Intelligence can react in real-time if any fraudulent behaviour is displayed by a subscriber, meaning you can immediately suspend them from the network and prevent revenue leaks. Similarly, you can monitor a customer’s behaviour and keep ahead of any unusual behaviour that may indicate they are not in control of their device. You can then contact the customer and ensure their account has not been compromised, protecting both them and your network.
Find out more about how our Event Intelligence module can protect against fraud in the telecom industry here or speak to a member of the Lifecycle team now.