Jamaican regulator to analyze VoIP blockades

Jamaica’s Office of Utilities Regulation (OUR) said it plans to further analyse whether VoIP services can be considered as illegal bypass before deciding whether local mobile operator Lime and Digicel can continue to block VoIP applications from its networks, The Jamaica Gleaner reports. The regulator has been holding meetings with the mobile operators, as well as representatives of consumer associations. Lime and Digicel Jamaica have recently blocked a number of VoIP applications including Viber, Tango and Nimbuzz as the apps were not paying the telco’s for routing their traffic over its networks.

New Spoofing Techniques being used for Phone Fraud

WMC News is reporting a new technique being used for spoofing phone numbers for fraud.

Scam artists have accessed the decommissioned landline phone numbers of dead or canceled customers in order to “spoof” caller ID and push a credit card services scam, according to Tennessee telecom regulators.

Stacy Balthrop, deputy chief of the Tennessee Regulatory Authority’s Consumer Services Division, confirmed that telemarketers have learned how to forage for decommissioned phone numbers, program them into caller ID, then use them to solicit consumers with similar numbers.

“It is a computer program that they’re using to make those numbers similar, and we believe that it does increase the odds that the consumer will answer the phone,” she said.

One woman who contacted the WMC Action News 5 Investigators said she kept getting calls from a number two digits off of her number. The WMC Action New 5 Investigators have also heard from consumers who have received the same solicitations — and their own names and numbers have appeared on their caller ID systems.

Telecom Fraud Stops Fundraising Auction in Kansas

Hackers caused a phone outage in the Clay Center, Kansas recently, just as a local radio station was trying to raise money for a good cause.

KCLY Radio reports the outage impacted customers of Eagle Communications who use VoIP services. KCLY reports Eagle purchases services from Big River Telephone, which delivers services around the nation from its base in southeast Missouri.

Officials with Big River told KCLY their entire network was down for a while Friday because of hackers. The hackers made hundreds of millions of calls into the network, making the system unusable.

Unfortunately, the hackers hit just as KCLY was trying to conduct a day-long fundraising auction to benefit Relay for Life. They say service was out for about two hours.

AT&T Hackers Arrested in the Philippines

According to a recent fraud alert from the CFCA, six people were arrested by the anti-cybercrime police for allegedly hacking the system of American telecommunication company AT&T, causing about $24-million loss from the company, a police said Thursday.

Philippine National Police (PNP) Anti-cyber Crime Group (ACG) spokesperson Jhoanna Fabro identified the arrested suspects as Rosendo Catungal, Lani Diaz, Rommie Mondido Elmer, Liezel Feolog and Allan Villacrusis.

Three minors who were allegedly being used in the illegal activity were also arrested and turned over to the Department of Social Welfare and Development.

Fabro said three teams from ACG conducted the simultaneous operation in several areas in Luzon on Wednesday.

Catungal and Diaz were arrested in Tondo, Manila; Mondido in Longos in Malabon; the Feologs in Valenzuela City; and the Villacrusis in Angono Rizal.

PNP-ACG Chief Gilbert Sosa said among the arrested individuals was the “top most recipient of payments in dollars.”

Sosa said the operation stemmed from a complaint filed by Mark Zmigrodski, AT&T’s Global Fraud Management Organization manager requesting and seeking for police assistance, investigation and arrest of persons involved in telephone hacking in the country.
Sosa said Zmigrodski reported that on February 2011, he started noticing “large amount of unauthorized calling activity originating from the Philippines” attempting to hack the United States (US)-based business telephone systems owned by AT&T clients, the Private Branch Exchanges or PBXs.

“He initiated an investigation and started monitoring the calling activity of the intruding numbers to find out the extent of their activities from February 2011 to present. Consequently, he was able to prove and gather evidence of the intrusions over the AT&T long distance network perpetrated by an organized ring of several persons who have conspired to hack into PBX’s and use those PBX numbers as unauthorized access devices resulting in a significant loss to AT&T and its clients,” he said.

The hackers operate by making outbound calls to international toll-free numbers in the US using their land line or mobile phones, once they got through they will then dial the number of the target hacking victim.

The suspects were traced after they used their home telephone numbers for the activity.

“After dialing the targeted US telephone system, the hackers press touch tones (DTMF) on their telephone and illegally access the system in order to obtain free outbound calls,” Sosa said.

“The pattern of multiple calls with hacked PBX’s connected to their home phone lines provide probable cause that fraud is occurring from that residence. They then use the hacked PBX’s to dial high-cost international premium rate (revenue share) numbers,” he added.
The ACG chief said the illegal activity resulted a significant loss to AT&T and their corporate customers and in its wake, leaves a trail back to the hacker’s home numbers identifying the hackers involved.
Seized from the operation were desktop computers, telephone sets, routers, assorted cellphones, assorted documents, laptops, modems, assorted digital storage, digital cameras, assorted identification cards, ATM cards, and printers.

The suspects who are presently detained at the PNP ACG are facing charges in violation to Republic Act 8484 or the Access Devices Regulation Act of 1998.

$166,000 Traffic Pumping Fraud hits seven person firm

Small companies beware – telephone traffic pumping fraud has no mercy – especially for the little guys.  A seven person architectural firm in Atlanta has learned the hard way and is fighting back.  Earlier this year fraudsters hacked their phone system one weekend and generated $166,000.00 in long distance charges.  Their long distance provider, TW Telecom has a system to detect fraudulent calls, but the system was down for 44 hours.  During that time, the fraudsters repeatedly called seventeen telephone numbers in Gambia, the Maldives and Somalia.  Most small businesses do not realize that with today’s technology, fraudsters can use a single telephone to generate dozens or even hundreds of simultaneous, high cost telephone calls.

TW Telecom is threatening to sue the seven person architectural firm if they do not pay up.  In fact, the amount has now increased to $190,000 because of late fees and a disconnect fee because the firm has since switched telephone service providers.  Unlike credit card services, telephone service providers have no responsibility to protect their customers from fraud.  This business model may have made sense twenty years ago, but today’s technology takes the risk of fraud to a whole new level.  The fraud risk is greater and the techniques to protect a small enterprise phone system are more complex.  More importantly, a whole new eco-system has developed that creates a huge incentive for traffic pumping fraud.  This eco-system has two components: 1) widespread software tools that make fraudulent traffic pumping easy, 2) the proliferation of international premium rate numbers that provide a quick easy way for fraudsters to receive cash payment for their traffic pumping.

In this case, the fraud victim recognizes the telephone business model is fundamentally flawed and is fighting back to make changes that will benefit all consumers.  In the telephone business model, there must be a flow of revenue from the customer to the final network provider that completes the call to the called party.  Every network in the path of an international call must get paid something for their effort.  This is a fair and reasonable business model that encourages growth and innovation in telecom services.  However, if traffic pumping fraud is going to be stopped, the incentive for fraud must be removed.  The transfer of cash payments from the call source to the final destination – the premium rate number holder - must be stopped when obvious traffic pumping occurs to remove the incentive for fraudulent traffic pumping.  Arguing this common sense idea that criminals must not be allowed to profit is the architectural firm’s goal.  They are filing a complaint with the FCC that TW Telecom is in fact aiding and abetting telecom fraud by transferring funds for obvious traffic pumping to the next network in the chain of telephone networks that carried the call to Gambia, the Maldives and Somalia.  By making this payment, TW Telecom is in fact party to the fraud.  Like most small business owners, it sounds like these architects understand that you get paid for doing a good job and you get in trouble when you cheat customers.  But this is telecom, whether their argument will win the day with the FCC will be determined soon.  This could be a watershed moment in telecom which is being threaten by a rapidly growing problem of traffic pumping fraud.

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FCC Shows VoIP Adoption on the Rise

The Federal Communications Commission has released a report providing details about telephone subscription information within a three-year period ending June 2013. It revealed that nearly half of wireline telephony customers in the U.S. are using some form of VoIP, but that 38 percent of that population is not buying service from traditional carriers such as AT&T and Verizon.

A summary of the report and its findings comes courtesy of Whir hosting and cloud services. During the period ending in June last year, Whir says the report shows that VoIP subscriptions (excluding Skype), where people could make and receive calls across an Internet connection, increased 16 percent in the U.S. This is in contrast to growth in the mobile telephone market which showed only a three percent growth over that same period. Furthermore, retail switched access-line subscriptions decreased by 10 percent in the same period.

Although the growth in the VoIP market appears to be booming, there is the caveat that the FCC found subscription numbers as much higher for individual consumers than it did for businesses. The report shows that, in June 2013, the VoIP business connections accounted for only seven percent of the total telephony market. VoIP residential, however, accounted for 27 percent of the overall market.

Whir speculates that the disparity in adoption could be a result of the difficulty of setting up business VoIP accounts. No matter how simple companies may make the setup, businesses will almost always have more lines, more phones, and ultimately more complexity than individual residences.

Regardless of who is adopting VoIP, though, telecoms may find themselves in danger of losing even more customers over the next several years if the trend continues. Individuals are apparently already seeing the benefits of VoIP, and as installation of such services for large groups becomes even easier, more businesses will likely switch to VoIP services as well. This could create a situation that is similar to what callers experience now but with Internet-based services instead of traditional landlines — “another system based on a different technology but with just as little competition,” Whir says.

That said, with an abundance of free offering such as Skype, the marketplace is also becoming difficult for VoIP providers. Service providers such as Vonage, though, are striving to compete by providing services to small and medium-size businesses. As they make it easier for businesses to establish their own multi-phone connections and continue to offer them premium features at competitive prices, business adoption could continue to rise and competition could find a niche in which to thrive.

The Modern IP Phone

A recent post at Telecom Reseller discusses the fate of IP phones. While it says that some online news sources have slated them to be doomed to the evolutionary dustbin, others have marveled at the flexibility of SIP technology and the transformation of IP phones that conform to the changing nature of the business world. It is impossible to truly predict the future, but the prevalence of SIP technology and its wide-reaching effect on global businesses may, in fact, be a better predictor of the lives of desk phones than any other information currently available.

Desk phones of the past were often mass-produced machines that attempted to meet the needs of many different businesses and their departments by becoming multi-use devices. Telecom Reseller says these phones “did a lot of things, but none of them really well.”

The status quo has changed, though, and IP phones are more advanced than ever. They have come a long way since the Meridian, and modern technology has made it possible to create both desk phones and mobile phones that can utilize SIP trunking architecture by manipulating that service with hardware and software.

Telecom Reseller believes that these advances will keep the IP phone around for many years to come. Yes, the desktop phone does face some competition with mobile phone technology — especially those mobile devices which can use the SIP architecture. Mobile phones are slowly replacing home phones in the consumer world, and that could definitely reveal itself as a strong predictor for what might happen in the business world.

However, despite advances in mobile, desk phones still make themselves widely useful because of their versatile and necessary nature. As this article has pointed out, desk phones can provide tremendous functionality with respect to handling unified communications; some phones can even allow users to participate in video conferences. For as long as employees continue to work at their desks, their desk phones will likely be an irreplaceable part of their working experiences.

For the time being, IP-based desk phones also have the advantage of never losing power. Although users can plug their mobile phones into outlets, desk phones provide an ease of use in some aspects that mobile phones cannot yet match. They are comfortably-sized, and they are assuredly a staple of UC. Mobile phones will continue to press hard for dominance, but they will not overtake desk phones just yet.

Study Predicts VoIP Infrastructure Investment to Grow by 90 Percent in Next Five Years

Businesses have moved beyond the trial stage when it comes to VoIP. That is one of the takeaways from a new report on the industry issued by networking and telecommunications analysts, the Dell’Oro Group. The report predicted that spending on emerging voice-related systems such as Session Border Controllers (SBCs), IP Multimedia Subsystem (IMS) Core and Voice Applications Servers (VASs) will grow by more than 90 percent over the next five years.

SBCs, IMS and VAS systems serve as some of the foundational infrastructure that runs VoIP systems, which signals that VoIP is on the rise and here to stay.

Part of what’s driving the growth is mobile VoIP. While mobile phones make it possible to call from anywhere, there’s still the added cost of using cellular minutes and managing both mobile and landline phones. But mobile VoIP eliminates many of those challenges, centralizing all calls around a single number that can follow the person around whether they are in the office, on the road or at home.

Mobile VoIP uses cellular data, not voice minutes, which also cuts calling costs.

“New services such as Voice over LTE (VoLTE) and Voice over Wi-Fi are expected to drive robust demand for SBCs, IMS Core and Voice Application Servers in the coming years,” noted Chris DePuy in a statement, vice president at Dell’Oro Group.

He added: “These newer systems are expected to replace the existing voice systems that have been used for over a decade. After several years of robust growth of these newer systems, their revenues are now overtaking older system revenue, resulting in our expectation that the overall voice market will remain stable in the coming years.”

Other VoIP infrastructure also will benefit from the growth, including the hosted softswitch market.

Softswitches enable the connection between the calling party and the receiver, the modern version of the switchboard operator. Hosted softswitches make VoIP even easier because they move the softswitch infrastructure to the cloud instead of requiring on-premise hardware installation.

So as VoIP investment grows, so too will the investment in other telecom infrastructure such as hosted softswitches.

Zambian mobile networks accused of telecom fraud

The Zambia Consumer Association (ZACA) has challenged Zambia’s telecom sector regulator to thoroughly investigate the country’s three mobile operators for fraud.

The consumer rights body wants the Zambia Information and Communication Technology Authority (ZICTA) to institute disciplinary measures against MTN, Zamtel and Airtel over the poor quality of service.

ZACA claims that the poor quality of services are not reflective of the high tariffs the operators were charging.

In addition, ZACA said the operators were also charging exorbitant fees for participating in promotion competitions that were often run to attract more subscribers.

Zambia Information and Communication Technology Authority
ZACA’s complaint comes in the wake of a poor quality and congested Airtel network over the past few days that has left subscribers fuming and in some cases even failing to communicate. Airtel claims it is upgrading the network.
ZACA executive director Samuel Simutunda alleges that mobile services provision continues to be poor despite high tariffs.

“Despite the high tariffs that telecom companies are charging, poor communication services have continued and that is why ZICTA must quickly move in to probe these providers,” Simutunda said.

Last week, ZICTA said it was probing all the three operators for poor communication services and warned it would take further legal action against the operator that will be found wanting.

ZICTA has already dragged all the three operators to court over poor communication services, which the authority claims were ‘criminal in nature’.

FCC Adopts Text-to-911 Rules

Building on commitments made by America’s four largest wireless carriers to provide text-to-911 service, the FCC adopted rules to ensure that all remaining wireless carriers and certain IP-based text application providers are prepared to support text-to-911 by the end of the year. Currently, more one hundred 911 call centers in the U.S. are serving portions of 16 states and two entire states (Vermont and Maine) are now accepting emergency texts.

The FCC said its new text-to-911 requirements apply to wireless carriers and “interconnected” text messaging providers (i.e., those which enable consumers to send text messages to and from U.S. phone numbers). This includes providers of “over the top” applications that support texting to and from phone numbers but not, for example, messaging apps that only support communications among users of games or social media.

The FCC also adopted a Third Further Notice of Proposed Rulemaking that seeks comment on the continued evolution of text-to-911, including the delivery of location information and support for text-to-911 when roaming.

The FCC previously adopted rules requiring text messaging providers to send an automatic “bounce-back” text message to consumers who try to text 911 where the service is not available.