Raids on SIM box/GSM gateway fraudsters save mobile operators millions

Raids on SIM box/GSM gateway fraudsters save mobile operators millions

October 5, 2011

Member Press Release

  • Raids across Africa, Asia and the Americas lead to arrests and prosecutions
  • Monthly savings for operators estimated to be millions of dollars
  • Millions in illegal hardware seized in raids

Raids on illegal fraudsters have revealed the size and volume of SIM box fraud being perpetrated against mobile network operators across the globe.  There have been recent publicised raids in Mauritius, Haiti, Senegal, Jamaica, Afghanistan, Nepal, Pakistan, Ghana and El Salvador.  These raids, in many cases prompted by information provided by fraud specialist consultancy Revector, have led to arrests, prosecutions and the seizure of millions of dollars worth of illegal equipment.

‘SIM box’ fraud takes place when individuals or organisations buy thousands of SIM cards offering free or low cost calls to mobile numbers. The SIM cards are then used to channel national or international calls away from mobile network operators and deliver them as local calls, costing operators’ millions in revenue loss.

Andy Gent, CEO of Revector commented: “From our knowledge of working in more than 60 countries, we estimated $150 million per year was being lost by mobile network operators to illegal fraudsters.  With the recent spate of raids, we believe that was a conservative estimate – the real cost could peak at more than quarter of a billion dollars in annual lost revenues.”

One raid alone in Haiti halted an illegal racket costing a mobile network operator more than $750,000 per month in lost revenues.  Another in Ghana seized equipment worth more than $200,000 and with the capability to hold more than 300 SIM cards concurrently.

“The fraudsters involved can set up this practice for a little as a few thousand dollars but clearly some are investing hundreds of thousands in equipment,” continued Gent.  “This “investment” can be paid back in days by deploying it for illegal termination of international calls.”

Illegal SIM cards can generate 10 cents per minute for more than 20 days per month, costing an operator up to $3000 per SIM card, per month in lost revenue.  The equipment seized in Ghana could generate almost one million dollars per month in fraudulent transactions.  Revector has knowledge of networks where 300,000 illegal SIM cards are operating concurrently, highlighting the scale of the issue.

Revector recently launched a new service that enables mobile operators to geo-locate fraudulent SIM cards, alert the authorities to seize equipment and make arrests.  The recent raids across the world demonstrate a strengthening of resolve by mobile operators to defeat the criminals defrauding them of revenues.

“These raids are good news for operators but they demonstrate the importance of remaining vigilant and proactive to reduce fraud,” commented Gent.  “With our new service, operators don’t just remove the illegal cards from circulation, they can make arrests and deter others.”

Revector offers mobile network operators, regulators and governments a quick and cost-effective way to identify SIM box fraud, removing millions of dollars’ worth of fraudulent activity from their networks.

Revector will be demonstrating its new services for mobile network operators at Gitex-Gulfcomms, 9th to 14th October, at Dubai International Convention and Exhibition Centre, Za’Abeel Hall, Stand Z-H33.

About Revector:

Founded in 2001, Revector creates products and services that enable telecommunications companies to quickly and effectively counter fraud.  Working with operators including Vodafone, Bharti Airtel, Hutchison Three, Zain, Digicel, Etisalat, Telenor, Tele2, Tigo, MTS, NTT DoCoMo, Rogers, T-Mobile and Cable & Wireless, Revector’s products have enabled mobile network operators to remove millions of dollars’ worth of fraudulent activity from their networks.  To find out more visit www.revector.com

About GSM gateway or SIM box fraud:

SIM box fraud occurs when the cost of terminating national or international calls exceeds the cost of a local mobile to mobile call in a particular country.  Individuals and organisations buy multiple SIM cards and sell capacity to terminate calls on the open market.  This leads to lost revenues for mobile network operators.  SIM box fraud is illegal since those who undertake it are not licensed to provide telecommunications services in the country.  Consumers will be unaware that their call is being routed via a SIM box but may experience a reduced quality of call or a reduction in telecommunications services, such as caller line identity.

Media contact:

Chris Bignell
XL Communications
Chris@xl-comms.com
Tel: +44 7834 020460

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