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SIM box fraud and its implications

Global communications businesses proliferated in the pandemic years with the rise of work from home (WFH). At the same time, businesses suffered from rising fraud management cases as newer and more complex methods of fraudulent activities robbed telecom corporations of billions of dollars. Such frauds have not only dented businesses financially but have also caused a loss of reputation and trust, triggering customer churn. In its latest Fraud Loss Survey report, the Communications Fraud Control Association shows an estimated global fraud loss in the telecom industry at $39.89 billion - about 2.22% of the total global revenue from this industry. What is a SIM box fraud and why it features among the top telecom scams in the past few years let us understand that.

What is a SIM box fraud?

SIM box fraud is among the most demanding challenges telecom operations face globally. The Fraud Loss Survey Report has pegged losses from SIM box fraud and the broader interconnect bypass fraud at $3.11 billion, or 7.8% of global telecom fraud losses. A SIM box fraud diverts international calls to a cellular device through the internet. This device, called as a SIM box, routes the connections back into the network as local calls, using hundreds of low-cost or even unpaid SIM cards, which are often obtained with forged identities. SIM box scams thus benefit by exploiting the difference between local and international charges by paying just local rates or none at all to cell carriers after billing international rates from the source. The caller pays the high call rates, but the local telecom operator does not collect these, leading to revenue losses.

Although telecom scams are spread globally, regions with high call termination costs attract fraudsters who take advantage of the voice traffic routes and profit from it. Hence, interconnect bypass frauds are more rampant in the Falkland Islands, Seychelles, Cuba, Chad, Maldives, Algeria, and European Union, among many other countries.

How SIM box fraud affects your business?

SIM box frauds and interconnect bypass frauds have severe implications on businesses other than the apparent revenue loss.

• Financial and revenue loss: Telecom operators face the flak of interconnect bypass frauds as they often go undetected leading to financial losses. Moreover, these scams escape government taxes and surcharges, depriving governments of revenues to fund infrastructure and welfare schemes.
• Poor service quality: SIM box frauds use a cheap and substandard setup that affects call quality and service. These reflect poorly on the service quality standards of telecom businesses, thereby affecting reputation, customer trust, and erosion of customer base.
• Damage to infrastructure: Overloading local networks affects the region&#;s infrastructure. Moreover, such scams demotivate businesses, resulting in low or no investment.
• Compromised security and privacy: SIM box frauds compromise legitimate connections that have privacy and security encryptions, making information theft easy for hackers. Moreover, SMSs that are often used to communicate sensitive information via automated routes lose all privacy and security.
• Threat to national security: SIM box frauds and interconnect bypass frauds escape legal intercepts by national security agencies, which track criminal activities. This becomes a significant security threat for the country.

How to prevent SIM box fraud?

The first step to protecting your business from potential losses is to have a fraud management system that can detect rerouting traffic through grey channels by doing a stress test of your network or undertake real-time monitoring. Other than making technical changes, having a strong legal team that can safeguard contracts with all stakeholders can help reduce the impact of fraud. Employing the latest forensic detection methods through reliable partners can reduce the incidence of fraud and improve the efficiency of your business. Powered by artificial intelligence (AI) and machine learning (ML), real-time and in-depth analytics can help you fight the ever-changing interconnect bypass frauds, safeguard revenue streams, and improve customer experience.

For organisations on the digital transformation journey, agility is key in responding to a rapidly changing technology and business landscape. Now more than ever, it is crucial to deliver and exceed on organisational expectations with a robust digital mindset backed by innovation. Enabling businesses to sense, learn, respond, and evolve like a living organism, will be imperative for business excellence going forward. A comprehensive, yet modular suite of services is doing exactly that. Equipping organisations with intuitive decision-making automatically at scale, actionable insights based on real-time solutions, anytime/anywhere experience, and in-depth data visibility across functions leading to hyper-productivity, Live Enterprise is building connected organisations that are innovating collaboratively for the future.

How can Infosys BPM help?

Timely and continued use of the latest solutions can ensure efficient fraud management systems that challenge the ever-evolving telecom fraud scenarios. With deep domain expertise, Infosys BPM offers three key services in its telecom fraud management solutions:

• Revenue Assurance and Fraud Analytics
• Assessment Services & Automation
• Digital Fraud and Revenue Assurance Operations

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Did you know that your business&#;s text messages might be at risk?

In an era where 98% of text messages are read within 3 minutes, the integrity of your SMS communications is more crucial than ever.  Enter the world of SIM farms and SIM boxes &#; the silent disruptors of the telecom industry. 

These seemingly innocuous terms hide a $5.19 billion global fraud scheme that&#;s affecting businesses worldwide. 

Whether you&#;re a small startup or a large corporation, understanding SIM farms and SIM box fraud is essential for protecting your customer communications and your bottom line. 

Let&#;s dive into this digital underworld and discover how you can safeguard your business.

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What is a SIM Farm

A SIM farm is a sophisticated setup that uses multiple SIM cards to send vast quantities of messages in a short time. 

These farms exploit telecom networks, often for nefarious purposes. Understanding what is a SIM farm is crucial for businesses relying on SMS communications.

SIM Boxes &#; The Technology Behind the Fraud

If you want to learn more, please visit our website what is a sim box used for.

SIM boxes are the backbone of SIM farm operations. These devices bridge the internet and cellular networks, enabling the routing and redirection of calls or messages through multiple SIM cards. SIM box technology has evolved rapidly, with modern versions capable of handling thousands of simultaneous connections.

How SIM Farms Work &#; A Deep Dive

SIM farms operate by simultaneously sending an enormous number of messages, overwhelming messaging systems. This can cause delays or failures in message delivery and makes it challenging for businesses to track message origins. Understanding how SIM farms work is the first step in protecting your communications.

The SIM Box Fraud &#; A $3 Billion Problem

SIM box fraud is a global issue, costing the telecom industry an estimated $3 billion annually. 

This form of fraud involves using SIM boxes to bypass regular call or messaging rates, leading to significant revenue loss for telecom operators and potentially higher costs for legitimate businesses.

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The Threat to A2P Messaging

Okay, you might be wondering, &#;What&#;s the big deal? Why should I be concerned about SIM farms and SIM boxes?&#; Well, let us explain.

A2P (Application-to-Person) messaging is used by businesses to communicate with their customers. It&#;s what helps you receive important notifications, confirmations, and updates from your favorite brands. But here&#;s the catch: SIM farms and SIM boxes can disrupt this communication, leading to delays, dropped errors, or even fraudulent activities.

The use of SIM boxes is generally considered illegal or unauthorized because it can result in revenue loss for telecom operators. They rely on charging fair rates for voice calls and SMS messages to sustain their services and network infrastructure. Telecom operators employ various measures to detect and prevent SIM box fraud, including sophisticated monitoring systems and collaboration with regulatory authorities.

SIM box fraud can have negative consequences in terms of legalities, and in your marketing efforts as well. It can lead to quality issues, such as dropped calls or degraded call quality, as well as difficulties in accurately identifying the source of the call or message. This can all affect your business&#;s communications and any active SMS marketing campaigns. 

Protecting Your Business with HighLevel

HighLevel offers robust security measures to detect and prevent SIM farm and SIM box attacks. 

Our platform provides:

• Continuous monitoring of messaging traffic.
• Advanced pattern recognition for suspicious activity.
• Collaboration with mobile network operators for a trusted messaging ecosystem.
• Compliance with telecom regulations through our Trust Center.

By partnering with HighLevel, you can ensure that your A2P messages reach customers securely and efficiently, protecting your business from the threats posed by SIM farms and SIM boxes.

With HighLevel&#;s advanced security features and expertise in telecom fraud prevention, you can stay ahead of these digital impostors and ensure your business communications remain secure and effective.

Ready to protect your business from SIM farm and SIM box threats? Claim your 14-day FREE trial of HighLevel today and experience the peace of mind that comes with secure, reliable business communications.

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