Fraud can affect any peoples or business around the world, telecommunications organisations like MVNOs are no different. The trouble for MVNOs when trying to fight fraudulent behaviour is the vast range of tactics used by fraudsters, makes it difficult to achieve complete fraud management in telecoms.
How Fraud Affects MVNOs
To understand how fraud affects MVNOs, it is important to consider why an MVNO is such an attractive target for fraudsters. The MVNO market is growing, and at a rapid pace, with many expecting it to be worth over $98 Billion by 2026.
The main drivers of this growth will be the rollout of 5G technology and the transformation of consumers’ demands. Consumers currently, and in the coming years, heavily prefer the ability to purchase products or services through convenient digital applications. This preference for fast, tailored services aligns perfectly to the agile nature of MVNOs. The centralised nature of consumer purchasing is not however without its own risks. Converging technologies and services bring a serious concern for information security. MVNOs can be especially susceptible as the security of their systems is directly dependent on the security of the telecom’s system underpinning their own.
With this in mind, the types of telecom frauds affecting MVNOs could be broken down into three categories.
Compromising An Account
This type of telecom fraud utilises the convenience of a single sign-in to break into a customer’s account and highjack it. Once in the account, the fraudster can gain access to a customer’s personal information and financial services. They could also then use the information stored within an account to impersonate the account holder.
Financial Gain
Here the fraudster will exploit vulnerabilities within a telecoms network to gain access to a subscriber’s bank accounts. Although there are various methods to “hack” into the network, one of the most popular is for hijackers to intercept two-way authentication codes which can then be used to gain entry into an account and make off with funds.
Impersonation Attacks
These types of attacks have become more and more common over the past couple of years. They are initiated by the fraudster impersonating another organisation or entity. This could be the customer's bank, a charity, the post office or even another contact of the customer. The next stage of the attack then varies. Some will ask the victim to send money directly to an account, often under the guise of it being a donation or in exchange for a service (e.g. a post office claiming to need a re-delivery fee). Some might ask the victim to click on a link which will, once clicked, then install ransom or malware viruses onto their device. Either way, the outcome of these attacks is the same, a loss of funds and personal data for customers.
How MVNOs are Dealing with Fraud Attempts
Although MVNO have a number of systems in place to deal with fraudulent activities, part of the problem for them is knowing where to start. Fraudsters like to vary the techniques they use and will often rotate them. They are also constantly coming up with new technics, designed to exploit a newly discovered weakness. A further complication for MVNOs is the knowledge that no matter how good a fraud management system they have in place, it would be challenging to stop every fraud attempt without compromising core services. For example, the only way to block impersonation text messages would be to block all text messages, impossible for a successful MVNO. MVNOs have therefore come to the realisation that although they can’t block all attempts at fraud, by catching fraudulent activities as quickly as possible they can stop or limit the damage to their customers as much as possible.
To react as quickly as possible, MVNOs must have a complete picture of their network and a user’s activity on it at all times. This way any unusual activity is noticed and investigated as quickly as possible. This approach is not however without its practical difficulties for MVNO. MVNOs by nature are designed to run at minimal costs and have a limited amount of staff they can hire to still be profitable. This means they can’t hire an infinite amount of employees to monitor the network and flag any behaviour deemed suspicious. This is where automated technology and workflows are key for MVNOs. Correctly deploying this technology allows for a complete 24/7 overview of an MVNOs network, with the ability to suspend users if any suspicious behaviour is flagged. Using this technology then frees up employees to deal with more complicated customer service issues, without compromising customer security.
Event Intelligence
No matter what type of telecom fraud MVNOs are experiencing, the key to protecting both themselves and their customers is to detect and block fraudulent activities as soon as possible. By using predictive analytics and real-time decision making Lifecycle’s All in One Event Intelligence Module is able to monitor all subscriber activity on your network. We utilise directive workflow to enable a real-time reaction should any fraudulent activities be displayed by a network user. This allows us to protect networks from revenue leaks by immediately suspending them. Similarly, we can protect your customers by triggering alerts if it looks like they are no longer in control of their device or they are being scammed.
Find out how Event Intelligence can protect you and your customers from fraud by contacting a member of the Lifecycle team.