Notes

Phone Fraud Still a Problem For USA Businesses
What has happened to fraud in the telecom industry? Do you think it is still a problem? Are you as a business owner have to be concerned? Despite the huge advancements in security technology and increased telecommunication security protection and awareness for customers telephone fraud remains to pose a significant issue for all businesses. It is frightening to imagine the possible cost of thousands for businesses due to phone fraud. Fraudulent phone calls can cause financial loss to your company. That is scary. Even after the introduction of VOIP technology, hackers continue to discover ways to hack complicated systems, and businesses like mine could still be affected.

There are three major types of phone fraud that the majority of us should be concerned with and that will be discussed in this piece. Nuisance fraud (cramming and slamming) and the proprietary phone system (PBX and key system) fraud as well as voice mail fraud. the latest threat called VOIP phone system scam.

Nuisance Fraud: Many of us who are professionals will at one time or another come across nuisance fraud, also known as slamming or cramming. Although nuisance fraud isn't likely to make or break any business, it can drain revenues if it's not included on the phone bill.

Cramming happens when a third party provider charges fees or services that the customer has not authorized. These charges are neither ordered or requested by your business. These costs could include things like bogus voicemail service charges, operator-assisted call and programs for calling monthly fees and credit check services and monthly service charges. You may also be charged for fraudulent yellow pages or white pages that advertise.


Cramming is the practice of adding charges to a subscriber's telephone bill for services that were not requested nor ordered by the client or for charges for calls or services that were not properly disclosed to the consumer. These charges are often caused by untrustworthy third party suppliers of data or communication services that phone companies must allow to be added to the bill.

Have you looked over your local telephone bill and seen odd charges from "other service providers you do not recognize?" Chances are you have been scammed. Large businesses may have hidden costs in their invoices that are hard to see. They can continue for years without anyone being aware.

How can you stop the cramming process and receive refunds? First, contact the local telephone company and request an inverse of the charges. In the majority of cases they will. To file a complaint against them, call the FCC, the FTC or your state attorney general. First, you must let the person who crammed you know that you'd like to give them the chance to refund your money.

Slamming is when a carrier provides long distance, local or local toll service and an unauthorised change or switch. Slamming can be frustrating as untruthful phone companies can quickly change or "pick" your long-distance service to their plans at a higher rate than the one you had selected. If you do discover the scam, there's still the headache of switching all your lines back to the long distance provider you should have and getting the fraudulent company to issue you a reimbursement. How can you avoid this? Request your provider to put a "pic freeze" on your phone lines. Insist on the use of a corporate password to gain access to every local, cellular, and long distance phone accounts and limit access to those accounts to two people in the company.

Frauds within the phone system as well as voice mail types of frauds remain common for many businesses. They'll be around as long as there is PBX and Key-type phone systems. Long distance calls can be costly and hackers have easy access. It's easier to prevent this kind of fraud than to fix it once it's occurred. Let's face the truth, hackers, just like others are lazy. They'll just leave your company and move on to something else if you have the proper safeguards. First, make call phone that your phone system manufacturer supplied master default passwords for your voicemail and telephone systems are updated at your place of residence. Hackers have the passwords and could easily access your system if they can get access. A lot of these master passwords for phones (i.e. : Avaya, Siemens, Nortel, Mitel, Cisco) are posted online, and accessible to anyone. The change of passwords is done by making a call to the company that manages your phone systems.

Make sure your remote access to your telephone systems is secured. This is usually accomplished by using encryption technologies for security to ensure remote access to your system. Next, ensure that employees do not use passwords, such as "1111" for accessing their voicemail boxes. They are easily hackable. Also, set your voice mail system to auto remind employees to change their passwords each 90 days, at a minimum. Be sure to delete all voicemails which haven't been utilized by employees after they quit the company. Why? The hacker takes control of the voicemail mailbox and then records "yes" He then places the call with a third party, and tells the outside operator to dial the number of your departed employee's old mailbox. The operator asks, do you accept third party charges for Mr. Jones' call and the voice mailbox responds, "yes" as programmed.

Companies today face another major threat from weak links in their employees, particularly the receptionist at the company. It is often referred to as "social engineering fraud." Your receptionist and employees should be aware of a call that's received, where an individual may identify him/herself as a representative of the company that is conducting tests on lines. They could say, "I'm with the phone company and I'm running tests on your phone systems. I'd like to transfer you to a specific extension." Transferring a person to certain digits first accesses an outside telephone line "dialing 9" and "dialing the number 0" opens the line to an outside operator who can facilitate calls to any location in the world for the criminals. The calls are then back charged to your company. Hackers also have other tricks, such as identifying the directors of large corporations and then impersonating them when they make calls made to your company. Because board members do not communicate with receptionists as frequently as employees, it is possible for receptionists to not be able to recognize their voice. However, because of the board members' prestige, authority or standing in the business, receptionists are aware of their power, so the person calling them can get unlimited transferring ability to commit crimes. Most often, the crime is not identified until the bill is due. Inform the employees and receptionists of this ploy. This ploy was employed by numerous companies to generate thousands of dollars in international calls.

If your business has a toll-free inbound number be aware! Hackers can call the toll-free number and make use of codes and features for calls abroad and also to charge fees for paid calling services.

Another thing to do is restrict some calls forwarding and conferencing functions in your phone system for business which could aid hackers in forwarding calls on your dime. To ensure that your phone system's security, meet with the vendor of your phone system to conduct a vulnerability analysis. Most of the larger phone equipment manufacturers, Siemens, Avaya, Nortel and Mitel provide security bulletins and security support programs to help ensure that your system is secure and up to date.

VoIP Fraud: This is the third and last concern about telecom voice fraud. Voice over IP fraud is still in its infancy but becoming more prevalent. As mentioned previously in the section on phone system fraud, changing the system passwords within your VOIP phone system is among the most effective ways to avoid this type of fraud.

There is now more attention paid to recent attacks on VOIP systems, but actual instances of documented fraud are now just beginning to emerge as problematic. In 2007, two people were arrested because they routed calls using unprotected ports on networks at other companies to route calls to providers. They routed half a billion calls to a VoIP provider in the span of three weeks. Federal investigators believe the two made as much as $1m from the fraud. While actual instances of VOIP fraud are rare but it is possible to cause severe harm through exploiting security holes and weaknesses that are becoming more frequent.

VoIP hackers can use passwords from company systems in order to access voice systems. They also have the ability to steal millions of minutes of long distance service. How? How? They design and apply custom software codes to crack access codes and access exposed data ports , computer systems and data gateways. Hackers are able to access default or badly chosen passwords.

To stop these attacks against your business and stay up-to-date with the latest security technology and VOIP fraud prevention tips, consult with the VOIP equipment suppliers and ask specific questions on how to best protect your system. It might be beneficial to engage a professional to conduct a security audit of your VOIP system if you have a large one. The most recent encryption methods are required for IP business users and IT managers. Additionally, they must ensure that employees are trained and monitored so that they can ensure efficient security of data from companies.

An extensive telecommunications audit is the best method to find out if there is any telecom fraud in an organization.




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