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IP Phones - Concern Grows for Companies Defrauded by IP Phone System Theft
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October 29, 2014
Concern Grows for Companies Defrauded by IP Phone System Theft
By Daniel Brecht, Contributing Writer

A business telephone system is one of those critical tools used in a workplace; but, what would happen if phone hacking occurred and fraudsters were able to penetrate into phone lines and make premium rate calls costing organization business owners hundreds of thousands of dollars?

According to Communications Fraud Control Association statistics, an industry group financed by carriers and law-enforcement agencies to tackle communications fraud, premium rate frauds cost victims $4.73 billion in 2013. That is up nearly $1 billion from 2011.

Although major carriers have sophisticated fraud systems in place to catch hackers before they run up false charges, these scams are still happening and customers are often left to pay the bill. Therefore, it comes necessary to find ways to prevent such attacks. The best advice would be to ‘block’ all international calling, as well as domestic 900 numbers. Another option would be to analyze a phone provider’s fraud protection plan and boost security regulations in-house. Having a security system in place to detect unusual calling activity is paramount. Otherwise an organization is leaving such systems exposed to hackers.

Nonetheless, fraudulent charges are taking place today; as problems continuing to escalate, it appears that people are not aware that their phone systems are just as vulnerable as computers and mobile devices for phone usage theft.

A recent post featured in Associations Now about premium rate fraud reveals phone systems are vulnerable to costly hacking; also, voice over IP (VoIP) phone connections—that are increasing in numbers thanks to the fact that they can save consumers up to 50 percent when making local and international calls—have become increasingly vulnerable to external attacks. Since VoIP systems use the Internet, they are obviously subject to hacking (as discovered in a security flaw in the snom 320 VoIP phone).

Unfortunately, some organizations have already fallen victim to fraudsters who have been able to make several thousands of international calls to various foreign countries, all at the expense of the company.

Hack attacks against small business phone networks are nothing new, experts say; in fact, they have been going on for the past two decades, with the difference now being they are increasing dramatically in number. Once the phone line(s) are hijacked, the hacker simply makes phone calls to the premium number, racking up massive phone bills.

The scheme works this way, telecommunications fraud experts say: hackers sign up to lease premium-rate phone numbers, from one of dozens of Web-based services that charge dialers over $1 a minute and give the lessee a cut; hackers then break into a business’s phone system when the company offices are closed or during quiet times and make calls through it to their premium number. Both the provider and the hacker gain from this fraud, as the post points out.

According to the security experts, small-businesses are often completely unaware of the potential for their phones to be hacked by criminals who can make multiple simultaneous international calls to premium numbers using just one of their phone lines.

So far, neither the FCC (News - Alert) nor the FBI seems very interested in stopping phone hacking; they apparently are more interested investigating cyber intrusions into personal online accounts. The federal government, which regulates phone service, has been slow to respond to this problem as well. Therefore, it is up to end users to protect their phones (whatever the brand) from costly hacking; most can be easily identified by spotting calls to 1-900 prefixes. 

Edited by Alisen Downey
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