Now & Then: 3 Types of Business-Targeted Phone Fraud

There’s no denying it—fraud by phone has increased and it’s the businesses on the receiving end that are suffering. As the cost of a call drops to zero and technologies like VoIP continue to proliferate, I can’t see this problem going away anytime soon or maybe ever. The only option is to stay educated on the scams that are out there. With that in mind, I’m pulling together three trends in fraud and offering some tips on how to avoid them.


The Trouble With Toll-Free Traffic Pumping

Traffic pumping is the abuse of toll-free numbers from automated dialers that generate artificial calls to toll-free numbers. Based on the revenue share agreements held between all the connecting carriers, toll-free number owners are on the hook for long duration, “dead air” phone calls. These dead air calls jam up contact centers and lead to expensive bills. At its height, this kind of fraudulent traffic accounted for as much as 30% of all toll-free traffic.

The solution? Add real-time call screening, like Whitepages Pro Phone Reputation, to identify and reroute all risky traffic. Our API results will give you details such as the type of unwanted call, making it even easier for you to spot a number engaged in toll-free traffic pumping.

Hacked PBX Systems

This attack identifies vulnerable private branch exchange (PBX) systems, via a program called SIPVicious. These hacked PBXs can be used to make fraudulent calls to legitimate numbers. In other words, calls are made from legitimate businesses via a compromised PBX will result in inflated phone bills.

The solution? Limit traffic to and from your phones that is only from your VoIP provider’s IP addresses.

Local Carrier Exchange Arbitrage

This scheme exploits the arbitrage opportunity enabled by FCC regulations, leading to high termination charges for carriers. To encourage competition for Incumbent Local Exchange Carriers (ILECs), the FCC allows rural Competitive Local Exchange Carriers (CLECs) and Incumbent Local Exchange Carriers (ILECs) to charge high terminating access charges for completing calls they take from Inter-Exchange Carriers (IXCs).

This scheme has largely faded away, but it’s fascinating to learn about the clever tactics used to exploit regulations—a factor which is at the heart of most of this fraudulent phone activity.

As you can see, fraudsters are creative and will exploit any opportunity for revenue, despite the risks. If there are other schemes affecting your business, let us know. Our Phone Reputation team has the leading infrastructure to detect today’s fraud schemes—and whatever comes next.

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