Aug 10, 2023

Beyond the Breach: Resolving the Crisis of Enterprise Fraud

Telecom fraud poses a significant threat to enterprises across various sectors, resulting in substantial financial losses. Recent attacks on several tech giants have highlighted the problem’s scale and emphasized the urgent need for enhanced protection measures.

Twitter is a prominent example, which, as reported by Elon Musk, was losing up to $60 million annually to A2P SMS fraud, also known today as AIT.

In this article, we’ll explore enterprise fraud types and how brands can combat these malicious schemes with 99.995% accuracy.

Major Risks Enterprises Face Today

Enterprises face a diverse array of fraudulent attacks that exploit vulnerabilities in their telecommunication systems, threatening both Voice and SMS channels:

  1. PBX Hacking

    PBX hacking involves fraudsters exploiting businesses’ private branch exchanges (PBX) through two main scenarios:

    • Artificial Inflation of Traffic: Fraudsters generate a significant volume of traffic by dialing specific number ranges. However, this traffic is intercepted midway by bad agents who redirect the payment flow, generating revenue for the fraudsters.
    • Fraudulent Routing of Traffic: Here, a compromised PBX is exploited to dishonestly route legitimate traffic. Calls from end-users of the originating service provider pass through the hacked PBX before reaching legitimate end-users. Detecting this scenario is extremely difficult because of its natural origin.

    Both scenarios have severe outcomes. At the end of the billing period, targeted brands face exorbitant bills. While they may not always be forced to pay for fraudsters’ work, the consequences can still involve data theft or rendering the PBX unusable. The financial and reputational costs of such incidents can be highly damaging for enterprises.

  2. Wangiri 2.0

    Initially presented by LANCK Telecom at the GSMA FASG 15 conference in Warsaw in 2019, it was named Wangiri 2.0 to enhance its recognition and understanding within the industry.

    Enterprises are the primary target of Wangiri 2.0. Fraudsters exploit their obligation to return calls to potential customers by employing bots to complete contact forms on company websites — providing premium-rate numbers as contact phone numbers.

    Hence, the targeted company unknowingly calls these numbers with high rates, resulting in an enormous bill without gaining any actual paying customers.

  3. AIT (A2P SMS Fraud)

    Similar to Wangiri 2.0, fraudsters utilize bots to generate a large volume of sign-in requests. However, this fraud focuses on exploiting verification SMSs that deliver one-time passcodes (OTPs). Bad agents profit from this SMS traffic, collecting margins for their own gain.

    * A similar fraud scenario involves Pin-to-speech, where an automated phone call delivers the OTP through a recorded message.

    The consequences of this fraud are particularly concerning for enterprises:

    1. Substantial financial losses (as seen with Twitter, for example)
    2. Inaccurate valuation of marketing activities due to distorted results

Enterprise Fraud Challenges — Case Study

As recently as March 2023, LANCK Telecom participated in the Genesis Hackathon 2023, a competition where companies worked on innovative solutions for existing telecom issues. After the significant challenge of AIT was raised this year by BlaBlaCar, we collaborated on finding a solution.

So, what makes AIT such a significant challenge for the industry?

As rightly acknowledged in the Hackathon, detecting generated traffic is extremely difficult. Only in rare and highly suspicious cases is it possible to distinguish AIT from legitimate traffic, but by that time, the damage has already been done.

Some other reasons include:

  1. Growing rates for A2P SMS services attract more fraudsters. As prices rise, fraud becomes more common as the potential profits outweigh the risks for these malicious actors.
  2. The growing number of players in the market make it difficult to control the use of white routes, leading to an increase in fraudulent activity.
  3. Fierce competition for SMS OTP traffic among major messaging brands also fuels AIT. Bad players undercut market SMS prices to win tenders and outcompete genuine vendors, generating fake traffic to offset the cost.

But fear not, there’s a solution for enterprises looking to steer clear of these risks.

Our Solutions to the Problem

LANCK Telecom is a team of dedicated experts who strive to produce high-quality products for the telecom market, including Voice and messaging services, along with telecom enterprise solutions.

Drawing upon our vast experience in traffic processing, we’ve enhanced our capabilities by incorporating modern technologies to combat telecom fraud effectively. Today, LANCK Telecom’s award-winning solutions are trusted by more than 150+ partners worldwide.

Our mission is to minimize brands’ concerns about fraud, and we’re dedicated to achieving it. To that end, we constantly analyze traffic to ensure our clients are protected from current industry challenges.

By devoting resources to research and development, technology, work groups, learning, and training, we’re able to provide the solution.

The Solution: An FMS with Unmatched Precision

LANCK Telecom’s highly accurate Fraud Management System (FMS) protects 150+ operators and enterprises worldwide, detecting up to 800 fraud attacks daily.

Our Voice and SMS anti-fraud systems seamlessly integrate into existing security frameworks, enabling real-time traffic monitoring. This ensures swift detection and prevention of fraudulent attacks, effectively preventing potential harm.

By employing in-house developed mathematical models and machine learning (ML) algorithms, our FMS detects even the most well-concealed fraud attempts with an unparalleled 99.995% accuracy.

Securing Voice Services: IVR Module Protection

LANCK Telecom’s Interactive Voice Response (IVR) module offers comprehensive protection for both non-automated and automated voice services.

For non-automated voice services, the IVR module provides real-time warnings to employees when dialing high-risk numbers, allowing them to decide whether to continue the call or block it before damage is done.

Additionally, the IVR module safeguards automated voice services by preventing them from dialing random numbers. Instead, it ensures that they are used for legitimate calls to non-fraudulent and non-suspicious B-numbers, effectively preventing any exploitative attempts.

With LANCK Telecom’s expertise, your business can rely on us to manage schemes like Wangiri 2.0, providing you with peace of mind and enhanced security.

Blocking Fraud without Impacting Legitimate Traffic

The targeted blocking mechanism of our ML systems ensures that subsequent calls to nearby ranges, which might also be compromised, are prevented without disrupting legitimate call traffic from genuine subscribers.

This approach ensures minimal revenue loss while providing an uninterrupted service for your valued customers.

Efficient Channels Protected from AIT

With LANCK Telecom, brands can maintain efficient Voice and SMS channels for client interaction, safeguarded by our AI to prevent fraud. Save on two-way communication costs and unreliable options; select suitable channels for a clean and effective solution.

We help mitigate AIT’s impact on your revenue, optimizing authentication and communication costs.

Final Thoughts

Telecom fraud now poses a significant challenge for businesses in diverse sectors. Recent attacks on industry leaders emphasize the urgency for enhanced protection measures.

Adopting new technologies for telecom fraud protection has now become more critical than ever before. Apply for a free traffic consultation with our experts, where we can explore and develop a tailored solution that meets your business needs together.

Secure your brand and pave the way for a protected future today.

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