Telecommunications Fraud and Cyber Security

EMLPOYEES as well as external individuals steal airtime, the market buys the cheaper stolen airtime, but very soon those telecommunications companies will collapse and there won’t be any telco services at all.

If the market continuously steal or commit fraud, the telco prices will in turn continue to sky rocket, hence the companies will end up exiting the market, therefore we need to be ethical citizens. However, in this article, the focus is on SIM box fraud/traffic refilling.

What is a SIM box fraud?

A SIM box fraud diverts international calls to a cellular device through the internet. This device, called as a SIM box, routes the connections back into the network as local calls, using hundreds of low-cost or even unpaid SIM cards, which are often obtained with forged identities. SIM box scams thus benefit by exploiting the difference between local and international charges by paying just local rates or none at all to cell carriers after billing international rates from the source. The caller pays the high call rates, but the local telecom operator does not collect these, leading to revenue losses. According to the Communications Fraud Control Association’s ‘Fraud Loss Survey’ report for 2021, globally the SIM box fraud has cost the telecom industry around $3.11 billion, or approximately 7.8 per cent of the industry’s total revenue.

Lloyd Chirindo is the Enterprise Risk Management Institute of Zimbabwe award winner for Risk Manager of the year 2022.

Concentrating on local markets instead of considering international markets, monitoring how international calls outside the country and tracing how these calls are received on the other end is key in the business. If it is received as a local number, then somehow the traffic is going through a grey route where you can’t take all the money you are supposed to be collecting. The duty is to identify the grey routes by engaging service providers who continuously monitor through making individual test calls in order to determine the legitimacy of each call. These service providers offer SIM box detection services, and provide reports after every 5 minutes. After having such data, inquiries can be made regarding the location, quantum of prejudice, number of sim cards, registration details, source of the airtime in order to close those channels and possible arrests.

There is need for dedicated resources to perform such activities and recently POTRAZ came up with SIM box detection equipment where they inform service providers about any possible traffic refilling cases. Critically, it is not sustainable to continuously look for sim box fraudsters in this 21^st century. However, it is about upgrading technologies so as to become data driven technologies and systems that pro-actively detect and instantly block those numbers.

Furthermore, things have changed drastically, latest technologies, voice is now data driven at low cost to an extend that SIM box fraud is no longer a profitable crime. As developing countries, we need to upscale our mental models and challenge ourselves by evaluating whether investing in SIM box fighting activities is a futile exercise or the investment in platforms that support our telecoms, so that SIM box fraud becomes an unprofitable crime. SIM box operators are leveraging on taking traffic from telcos feeding into the internet and re-routing into Zimbabwe. The person allocating traffic still won’t make money since there would be internet connection all the way through.

Conversely, Zimbabwe is still not yet an internet driven connection since most voice calls are not yet being made through the conversion of voice calls into data calls. Additionally, there is need to invest more in infrastructure to allow rural folks to have access to the internet, to enable lowest cost of communication and that is where technology is going. Leadership needs to think strategically going forward so that all service providers can implement for it to make sense.

What is the role of the market in fighting SIM box fraud?

The market itself must be made cybersecurity and telecoms fraud aware and its high time when you are talking to somebody outside the country, but a local number appears on your phone and you must instantly disconnect the call. Don’t give the opportunity for fraudsters to make money, since the money generated from such nefarious activities is used to fund terrorism and money laundering. People should see what gives them value and the cost of making calls must go down.

What is the role of the legislature?

There must be punitive punishments to SIM box fraudsters, rather than fines for convicted offenders. Furthermore, there must also be dedicated courts for cybersecurity related crimes with highly skilled forensic investigators, public prosecutors and magistrates who totally understand these white-collar crimes.

In conclusion, telecoms fraud is enjoyable when one is illegally benefiting from the crime, but eventually, as good citizens, we should know that if we buy at the right price, the service provider will gain business such that they will offer the same product at lower cost.