Our blog is moving!

Learn From Someone Else's Mistake: The Costs Of VoIP Fraud

Posted by Ben Stegner on October 27, 2014 at 11:44 AM

A few weeks ago, we defined VoIP fraud and talked a little bit about why it's such an issue. Like many tragedies in life, however, it's easy to brush the issue off and assume that it will only affect other people. Today, let's take a look at a recent story of someone who fell victim to VoIP fraud and the huge aggravation that it brings about.

In March of 2014, Bob Foreman's architecture business accrued a bill for $166,000 of phone service in a single weekend. With only seven people in his company, and none of them present in the office at the time, he was dumbfounded and assumed it was all a mistake.

As it turns out, the charges were valid. Hackers had gotten into his phone network and routed hundreds of premium-price calls to countries like Gambia and Somalia. Astoundingly, at the small company's normal rate of usage, it would have taken them 34 years to run up that huge of a bill.


VoIP Fraud and hackers make people angry...

Perplexing the issue further was the fact that most small businesses don't use major carriers for their VoIP services, and go with local companies to cut costs. Oftentimes, these local companies don't have proper anti-fraud and no-liability systems in place, placing responsibility on the victim. Further, legal action isn't usually an option, since there's no laws forcing VoIP carriers to reimburse for bad charges like credit card companies must do. Due to this issue becoming rampant, the FCC has been asked to implement new regulations but hasn't complied yet.

Unfortunately, not many people who utilize VoIP service realize that their system is at risk. It's this ignorance that allows fraud to continue at the rate it has been, and the more users that take the time to be cautious, the safer the systems will be as a whole.

Typically, when a hacker decides to pull a scheme such as this, they lease premium phone numbers such as these that are often used for sexual calls or other illicit communications. Anyone who calls these numbers is charged a large amount, and some of it goes to one who leased the number. These numbers usually start with 1-900 in the US, but in other countries they're not as standardized.

Once they have the numbers ready, the perpetrators break into a business's phone systems and start mass-calling their numbers to make money. With today's hyper-fast computers, they can make as many as 220 minutes worth of calls in a single minute, hence the astronomical bills created in just a weekend.

It's a shame that these types of attacks are widespread and brutal. Putting a computer on the Internet in any form makes it a target for finding weak spots by those who want to use it for malicious purposes. To keep these thieves far from your system, consider disabling call forwarding, and be sure to set strong passwords that are only available to those with proper clearance. Today's business phones are machines connected to the internet that are potentially vulnerable. Taking steps to protect yours ensures you won't be a victim like Bob Foreman was.

For more advice on how to best combat VoIP fraud, contact one of our dedicated VoIP Consultants today. They are full of advice and are always willing to talk to those interested in learning more about the VoIP industry. 

Schedule Your Free Wholesale VoIP Consultation Today

Tags: VoIP, Entrepreneurship

Retail vs Wholesale: Which SIP Trunk is for you?

Subscribe to Email Updates

Recent Posts

Posts by Topic

see all