{"id":41524,"date":"2022-09-27T11:58:02","date_gmt":"2022-09-27T10:58:02","guid":{"rendered":"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/gsma_resources\/stop-the-fraud-stop-the-churn\/"},"modified":"2022-09-27T11:58:02","modified_gmt":"2022-09-27T10:58:02","slug":"stop-the-fraud-stop-the-churn","status":"publish","type":"gsma_theme_resources","link":"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/gsma_resources\/stop-the-fraud-stop-the-churn\/","title":{"rendered":"Stop the Fraud, Stop the Churn"},"content":{"rendered":"<p><a href=\"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/wp-content\/uploads\/2022\/09\/logo_full_color_ABHandshake.png\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-medium wp-image-30357\" src=\"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/wp-content\/uploads\/2022\/09\/logo_full_color_ABHandshake-300x300.png\" alt=\"\" width=\"300\" height=\"300\" srcset=\"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/wp-content\/uploads\/2022\/09\/logo_full_color_ABHandshake-300x300.png 300w, https:\/\/www.gsma.com\/get-involved\/gsma-membership\/wp-content\/uploads\/2022\/09\/logo_full_color_ABHandshake-1024x1024.png 1024w, https:\/\/www.gsma.com\/get-involved\/gsma-membership\/wp-content\/uploads\/2022\/09\/logo_full_color_ABHandshake-150x150.png 150w, https:\/\/www.gsma.com\/get-involved\/gsma-membership\/wp-content\/uploads\/2022\/09\/logo_full_color_ABHandshake-768x768.png 768w, https:\/\/www.gsma.com\/get-involved\/gsma-membership\/wp-content\/uploads\/2022\/09\/logo_full_color_ABHandshake.png 1080w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/a><\/p>\n<p><span style=\"font-weight: 400;\">As service quality falters, your customers leave. It&#8217;s that simple. And the more they leave, the less you grow.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Reducing churn is a common goal for all telcos, and while there are many issues to address here, fraud is the elephant in the room.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">What is Churn Management in Telecommunications?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Reducing churn in telecommunications requires many things:<\/span><b><\/b><\/p>\n<ul>\n<li aria-level=\"1\"><b>Improving service quality and customer support<\/b><\/li>\n<\/ul>\n<ul>\n<li aria-level=\"1\"><b>Timely dispute resolution<\/b><\/li>\n<\/ul>\n<ul>\n<li aria-level=\"1\"><b>Strengthening your brand reputation<\/b><\/li>\n<li aria-level=\"1\"><b>Building trust in your subscribers<\/b><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">But it&#8217;s challenging for a telco to accomplish this while fraud attacks persist on its network.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Fraud erodes call quality, violates user privacy, leads to dropped calls, country-wide blockages and more.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The fraud can come from anywhere, often via a corrupt carrier in the call chain or a spam caller targeting subscribers. Operators lose trust in one another, customer dispute tickets pile up, brand loyalty deteriorates and customer churn rises.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Any churn reduction strategy that doesn&#8217;t account for fraud will face major long-term challenges. By eliminating fraud, we can confidently reduce churn in the long run.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Costs of Reputational Loss and Customer Churn<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">In most telecom industries, it costs <\/span><a href=\"http:\/\/www.dbmarketing.com\/telecom\/churnreduction.html\"><span style=\"font-weight: 400;\">hundreds of dollars<\/span><\/a><span style=\"font-weight: 400;\"> to acquire a new customer, from promotion to onboarding.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">As your reputation erodes and your subscribers leave, you lose both the future revenue from that customer as well as the costs of acquiring them in the first place.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">And over time, the churn compounds the revenue <\/span><a href=\"https:\/\/abhandshake.com\/blog\/telecommunications-fraud-prevention\"><span style=\"font-weight: 400;\">telcos already lose to telecom fraud<\/span><\/a><span style=\"font-weight: 400;\"> on a daily basis.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Such losses reach billions of dollars each year. In 2019, total telecom revenue lost to fraud was <\/span><a href=\"https:\/\/cfca.org\/wp-content\/uploads\/2021\/02\/CFCA-2019-Fraud-Loss-Survey.pdf\"><span style=\"font-weight: 400;\">$28.3<\/span><\/a><span style=\"font-weight: 400;\"> bln and has been steadily growing. In 2021, that figure climbed to <\/span><a href=\"https:\/\/cfca.org\/wp-content\/uploads\/2021\/12\/CFCA-Fraud-Loss-Survey-2021-2.pdf\"><span style=\"font-weight: 400;\">$39.89<\/span><\/a><span style=\"font-weight: 400;\"> bln.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">How Can We Stop the Fraud?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Mitigating fraud is essential to protecting yourself from such losses. But effectively mitigating fraud requires a unique approach.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">By taking a new approach to fraud detection and prevention, call validation technology is allowing telcos around the world to exit the cycle of attack-adjust-repeat that many of telcos have been in for decades.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In other words, traditional fraud management systems rely on a reactive approach to fraud mitigation, using methods that have limited detection ranges. When a fraud attack hits, the damage is done. Operators adjust the settings of their fraud management system to better prepare themselves for similar future attacks. However, the fraud never stops evolving to evade our detection techniques.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">However, AB Handshake\u2019s proposed call validation technology can stop fraud with 100% accuracy and zero false positives, offering a long term solution for churn reduction in telecommunications.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But to understand and trust such a solution, we first need to understand the mechanism behind the attacks we face. What kind of threat are you up against each day? How do these fraud schemes hurt your reputation and lead to churn?\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Telecom Fraud \u2013 From revenue loss to churn<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Different fraud schemes impact carriers and subscribers in different ways. Here are some examples.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Interconnect Bypass \u2013 Poor call quality<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">SIM Box fraud is one of the most common forms of Interconnect Bypass fraud. Here, a fraudulent carrier in the transit paths illegally connects received international traffic via prepaid SIM cards and disguises it as low-rate (on network) traffic to inflate their profit margins.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For example, a corrupt carrier receives an international call from the previous carrier on the call chain and collects a fee for transiting the international call. The corrupt carreir routes it through a SIM Box, passes it on to the terminating operator as local, on-network traffic and pays the respective (low) on-network fee, thus inflating their profit margins.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This undermines revenues of any subsequent carrier in the call chain and, in some cases, allows the fraudulent carrier to avoid government tax surcharges.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">However, calls that are rerouted via a SIM box lose quality. They take longer to connect, may be rejected, and often drop, leading to caller frustration and immense churn.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Other fraud schemes, like Wangiri and Spam calls, target users directly in their wallets and drive subscribers away.\u00a0<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Wangiri \u2013 Eroding brand loyalty<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Wangiri targets both enterprises and subscribers. And in both cases, carriers bear major costs, particularly in the form of churn.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The aim of a Wangiri attack is to generate calls from consumers or enterprises to premium rate numbers. They accomplish this by triggering callbacks from unassuming subscribers (individuals or companies).<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In a traditional Wangiri attack, they make one-ring calls to subscribers to lure them into calling back, out of curiosity. Often, the fraudsters spoof the CLI to make the missed call look like it\u2019s from a local number.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If the curious subscriber calls back, they inevitably reach a recording of some sort and hang up after realizing something isn\u2019t right.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">At the end of the month, they see a shocking charge on their phone bill from a destination they never called. Unknowingly, when they dialed that missed call, they reached a premium rate destination and were charged accordingly.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Thousands of subscribers can fall victim to Wangiri fraud in a day. Out of frustration, subscribers file disputes with their carriers. While these are clear cases of Wangiri attacks, the carriers lack the means to confirm exactly what happened and who was responsible. Customer dispute tickets pile up and carriers face a dilemma \u2013 either foot the bill or face churn.\u00a0<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Spam Calls, Short Stopping, Call Stretching and More<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">In a <\/span><b>Short Stopping<\/b><span style=\"font-weight: 400;\"> attack, callers simply never connect to their intended destination. They dial a number, only to be rerouted to another strange recording at a premium rate number, which is reflected by the shocking charge on their monthly phone bill.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">As they struggle to stop these attacks, carriers sometimes take the desperate measure of blocking entire number ranges of high-rate destinations altogether. Terminating operators in these destinations lose revenue as traffic volumes drop. Callers to these destinations become increasingly frustrated as their calls won\u2019t connect. Eventually, they turn to other carriers.\u00a0<\/span><\/p>\n<p><b>Call Stretching<\/b><span style=\"font-weight: 400;\"> works similarly, though it adds a sensitive element to the issue: a fraudulent carrier simply cuts the B-side from the conversation mid-call, rerouting the A-side to a premium rate destination and connecting the caller to a recording of their previous conversation. In doing so, they extend the charged duration of the call and pocket the profits.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Because Call Stretching occurs in the middle of legitimate calls, traditional fraud management systems struggle to detect it. Transit carriers lose revenue. Callers face poor service quality and have the unpleasant experience of realizing their privacy was violated \u2013 a critical issue when data privacy around the world is of utmost importance. Eventually, subscribers may turn to another service provider.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In the case of <\/span><b>Robocalls<\/b><span style=\"font-weight: 400;\"> and <\/span><b>Spam Calls<\/b><span style=\"font-weight: 400;\">, users are duped into purchasing phony services or transferring funds to a fraudster\u2019s account. Subscribers lose faith in their service provider to stop the calls, and simply move on.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Stopping Telecom Fraud With a Fraud Management System<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">While fraud\u2019s impact on churn is no secret, many telcos still struggle to effectively mitigate fraud with a traditional fraud management system (FMS).<\/span><\/p>\n<p><span style=\"font-weight: 400;\">There are two fundamental issues.<\/span><\/p>\n<p><b>Firstly<\/b><span style=\"font-weight: 400;\">, such systems rely on inefficient manual detection methods and outdated threshold-based rules. While they can stop some fraud, they have limited detection capabilities and fail to accurately detect all attacks.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Additionally, they can\u2019t stop fraud in real-time, before the damage is done. Instead, they provide feedback after an attack occurs. Operators then update their system settings to prevent similar future attacks, but fraudsters&#8217; tactics evolve and remain steps ahead of any solution. A game of cat-and-mouse ensues while losses persist.\u00a0<\/span><\/p>\n<p><b>Secondly<\/b><span style=\"font-weight: 400;\">, these systems offer very little insight into the events of the call chain. The A and B operators aren\u2019t aligned on the true A and B numbers and call start and end events. This makes it difficult to pinpoint where the fraud occurred and who is responsible for it.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A lack of communication between operators and increased isolation prevails, further enabling the fraudsters to operate undetected. As a result, distrust between international carriers has become another major problem.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">By giving operators a means to communicate with each other in real time about the call events on a call before it connects, we create transparency along the entire transit route.\u00a0\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">We reverse the isolation and create an environment for detecting and blocking fraud before it hits. We stop the fraud and we stop the churn.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This is how AB Handshake\u2019s proposed call validation technology works.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Stop the Fraud, Stop the Churn \u2013 Call validation technology<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Call validation is an anti-fraud technology based on the simple but impenetrable principle of cross-validating the call details of each call in real time before it connects. Any discrepancy in the call details indicates fraud and the call is blocked before it can do any harm.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This solution guarantees 100% accurate detection and blocking of all voice fraud with zero false positives.<\/span><\/p>\n<p><b>Here&#8217;s how it works<\/b><span style=\"font-weight: 400;\">:\u00a0<\/span><\/p>\n<ol>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">When a subscriber initiates an inbound or outbound call on a network covered by the AB Handshake solution, the details of the call are immediately delivered to a call registry.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The call registry then simultaneously sends a validation request to the terminating network, which always reaches there before the actual call.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The system cross-validates the call details from both registries.\u00a0<\/span><\/li>\n<\/ol>\n<p><span style=\"font-weight: 400;\">Any discrepancy indicates fraud. The call is automatically alerted as fraud or blocked before it connects.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Example: Call Validation\u2019s Response to Short Stopping<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">In the case of <\/span><b>short stopping<\/b><span style=\"font-weight: 400;\">, the originating operator sends a validation request to the intended terminating operator of the call. Since the call was rerouted mid-transit, the originating operator receives a response that the call never reached the terminating network. The call is flagged and blocked before it connects.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Call validation is a foolproof approach to mitigating telecom fraud. All traffic exchanged between operators using the \u2018handshake\u2019\u00a0 is guaranteed to be 100% free of all telecom fraud. And with zero false positives, operators rest assured they\u2019re only blocking the fraud \u2013 nothing more and nothing less.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">A Fraud Free Community<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">There is an inherent incentive to join the call validation community \u2013 to avoid exchanging traffic with operators whose traffic cannot be validated. As new members join, a greater share of traffic around the world is validated, strengthening the ecosystem. As the volume of secure traffic grows, the volume of unsecured traffic around the world shrinks, eventually leaving the fraudsters with nowhere to turn.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If adopted on a global scale, call validation technology can eliminate telecom fraud worldwide, allowing telcos to secure their reputations and bring customer churn levels back within reach.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This technology is compatible with the default network system of any operator located anywhere in the world. Integration takes one week and its costs can be scaled on a pay-as-you-grow basis.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In other words, call validation is an affordable means of eliminating telecom fraud on any network in any location in the world, for good.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">A Global Solution, Once and For All<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Today, call validation tech validates live traffic to every country in the world and more operators are actively onboarding this technology into their systems.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">By implementing call validation technology, carriers are again building trust between one other. Subscribers are again starting to trust their carriers (can you imagine a world free of robocalls?).\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Carriers are reducing churn in the long run, once and for all.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>As service quality falters, your customers leave. It&#8217;s that simple. And the more they leave, the less you grow.\u00a0 Reducing churn is a common goal for all telcos, and while there are many issues to address here, fraud is the elephant in the room. What is Churn Management in Telecommunications? Reducing churn in telecommunications requires [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"template":"","meta":{"image":null,"json":{"gsma_resources_type":"Document","gsma_resources_thumb":"[]","gsma_resources_file":"[]","gsma_resources_multi":null,"gsma_resources_wgr":null,"gsma_resources_video":null,"gsma_resources_image":"[]","gsma_resources_url":"","gsma_resources_date":"27\/09\/2022","gsma_resources_button":"Download"}},"tags":[],"resource_categories":[4872],"algolia_discover_type":[9668],"class_list":["post-41524","gsma_theme_resources","type-gsma_theme_resources","status-publish","hentry","resource_categories-resource-document","algolia_discover_type-resource"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.9 (Yoast SEO v24.4) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Stop the Fraud, Stop the Churn - Membership<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/gsma_resources\/stop-the-fraud-stop-the-churn\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Stop the Fraud, Stop the Churn\" \/>\n<meta property=\"og:description\" content=\"As service quality falters, your customers leave. It&#8217;s that simple. And the more they leave, the less you grow.\u00a0 Reducing churn is a common goal for all telcos, and while there are many issues to address here, fraud is the elephant in the room. What is Churn Management in Telecommunications? Reducing churn in telecommunications requires [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/gsma_resources\/stop-the-fraud-stop-the-churn\/\" \/>\n<meta property=\"og:site_name\" content=\"Membership\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/wp-content\/uploads\/2022\/09\/logo_full_color_ABHandshake-300x300.png\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:site\" content=\"@gsma\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"9 minutes\" \/>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Stop the Fraud, Stop the Churn - Membership","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/gsma_resources\/stop-the-fraud-stop-the-churn\/","og_locale":"en_US","og_type":"article","og_title":"Stop the Fraud, Stop the Churn","og_description":"As service quality falters, your customers leave. It&#8217;s that simple. And the more they leave, the less you grow.\u00a0 Reducing churn is a common goal for all telcos, and while there are many issues to address here, fraud is the elephant in the room. What is Churn Management in Telecommunications? Reducing churn in telecommunications requires [&hellip;]","og_url":"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/gsma_resources\/stop-the-fraud-stop-the-churn\/","og_site_name":"Membership","og_image":[{"url":"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/wp-content\/uploads\/2022\/09\/logo_full_color_ABHandshake-300x300.png","type":"","width":"","height":""}],"twitter_card":"summary_large_image","twitter_site":"@gsma","twitter_misc":{"Est. reading time":"9 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/gsma_resources\/stop-the-fraud-stop-the-churn\/","url":"https:\/\/www.gsma.com\/get-involved\/gsma-membership\/gsma_resources\/stop-the-fraud-stop-the-churn\/","name":"Stop the Fraud, Stop the Churn - 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