39 posts • joined Tuesday 31st July 2007 18:02 GMT
Premium Rate Fraud-how it works
1/ Ofcom/Networks allocate the short codes/premium rate numbers to the Premium Rate Industry.
2/ Premium Rate Industry think up ways of making our phones ring the premium rate numbers or receive the premium rate message.
3/ Our Network bills us, pockets 50% of the money and passes the rest on to the Premium Rate Industry. They also pass on all the blame for the 'fraud' and the complaining customer.
We have been here before and learnt nothing. The rogue dialer is dead, long live the rogue dialer.
Known 'Fraud' 2003 to 2011 and no prosecution.
@ John Leyden
The $2m refers to just 2011. From 2003 to 2009 the amount was $53m.
In 2007 Paul Michael Kwan was arrested in the Philippines for defrauding customers worldwide by phone hacking.
It was discovered this group had since 2003 defrauded US AT&T customers $53m alone.
In 2009 Paul Michael Kwan and the hackers were again supposedly investigated.
In 2009 there was a US Court indictment against them.
In 2011 Paul Michael Kwan and the hackers were again arrested in the Philippines because they were still hacking and defrauding US AT&T customers and others around the world. This time AT&T said the amount was $2m.
here's the US Court Indictment from June 12, 2009 which raises serious questions.
'The Indictment has been assigned to U.S. District Judge Mary L. Cooper in Trenton. No
hearings are currently scheduled before the court, as defendants Nusier, Kwan and Gomez
are residing in the Philippines and would only make an appearance in the United States
subject to their self-reporting or extradition. The individuals arrested in Italy will be
prosecuted in Italy.'
I've searched and there was no extradition or prosecution in the US. So why were they allowed to continue to defraud the public worldwide?
mobile numbers data
are they obtaining the victims numbers from the mobile networks employees?
60999 scam 'follow the money'
It appears from comments made on the internet referring to other problems that MX telecom is the company that 'owns' 60999.
Txtnation is just one of a number of resellers. These are revenue share short codes. MX telecom must know which reseller they are passing the revenue to for this premium rate 'service'. In turn that reseller must know which client is using which keyword/code in order to pass on the revenue.
Under the Phonepayplus code the revenue should be withheld (by the network/presumably MX telecom in this case) for 28 days before being passed on. This was introduced supposedly to stop this type of fraud. It obviously has not. The fact that this withheld revenue is used to pay any fines that Phonepayplus may decide to impose on the scammer possibly explains this.
Of course if this type of fraud was reported to the police nobody in the revenue chain (including Phonepayplus) would be allowed to touch any of that money.
Phonepayplus knows 60999
These are revenue share short codes. All the Regulator has to do is 'follow the money' to discover who is behind this fraud.
Ofcom allocated the short code block 60000 - 60999 to Orange. The short code 60999 was given to txtNation.
txtNation uses it to run numerous campaigns on behalf of their clients.
Phonepayplus should ask them.
Alun Michael 'confused and conflated' car with computer again
19 Dec 2005
Internet (Rogue Dialling)
Mr. Blizzard: All that I asked for was some justice for the people who had already been victims. I fully acknowledge the tremendous work that my right hon. Friend has done to try to set the system straight, but if we cannot catch the fraudsters and hold them responsible, what is to be done for the victims of the fraud, who only had a contract with BT or some other provider? Can the Government not do something for those victims?
Alun Michael: As I said at the beginning, if my hon. Friend had raised that issue with some clarity I could have said more.
In the cases that my hon. Friend mentioned, BT is the provider of a line. The equipment that is placed on the line and its vulnerability to being used are matters of individual responsibility. They are not the responsibility of BT, which provided the computer whose technology and software were not protected against the possibility of a scam.
As I said, this is a complex area. During 2003 initially but primarily during 2004, there was an explosion of activity involving a scam that had not been anticipated. Many people recognise the need for proper protection for their software and equipment, but do not realise until something goes seriously wrong how important that is, and that it is their responsibility and not that of the provider.
If there is a problem on the road, that has nothing to do with the car that is driven over it. Responsibility for the vehicle and its safety is governed by legislation. It must have passed its MOT, and it must be safe. That is entirely different from the provision of the highway. I think that my hon. Friend has confused and conflated a number of issues.
BT discovered within a day that there was a problem from an analysis of charges that were building up, and notified the person whose equipment was allowing that to happen. It was therefore possible to close it down, and indeed to close the access to overseas numbers. There are numerous such examples.
People have been able to perpetrate a scam and disappear with the money. When that happens, there is no one left to blame, although there are victims. The service provider is a victim, the individuals are victims, but there is no one to blame. We have created a system that will hold money for up to 30 days. I was examining a case with officials and experts today. The fact that the equipment was allowing the criminal—the scammer—to programme it to make the calls was identified within 24 hours. Within 48 hours, the number had been blocked, so the scam could no longer continue. The 30-day delay means that money can be retained within the system and there is a possibility of recompense or, if the equipment has not been properly put in place, of fining. I had hoped to explain some of the wider context: there may not be enough time left, but I shall attempt to do so for my hon. Friend.
We are talking about an industry that is rapidly developing. It provides a variety of services that are used on a daily basis. It is an immensely powerful tool, but my hon. Friend will know that every time one connects to the internet, a warning appears asking whether the user really wants to proceed. The point is to illustrate for users that, along with the power of the system, there are also vulnerabilities.
ICO and Phonepayplus and Premium Rate Fraud
This year Phonepayplus admitted there had been a 40% year on year rise in complaints from the public claiming they had received reverse billed premium rate sms texts that they insisted they had not sgned up for.
Phonepayplus admitted the major cause for this rise in complaints was the 'black market' trading within the 'industry' of third party data lists of mobile phone numbers. They also admitted that these lists had been collected and sold by price comparison sites and retailers that had no connection with Premium Rate Services.
If Phonepayplus were aware of this in the cases they 'investigated' how many did they refer to the ICO. How many of these 'companies' have the ICO investigated and prosecuted using the Data Protection Act?
Millions of pounds stolen from mobile phone accounts and not one prosecution.
and pigs will fly
For 'Public interest' read National interest
National interest read commercial/economic interest.
For commercial/economic interest read the interest of the Mass Marketing industry that is lobbying the Government.
Trade Bodies and Lobbyists
The mass marketing industry that wants this are part of influential global trade bodies.. These bodies lobby Government and Government listens. This Government never listens to the public.
If there is a conflict of interest between Commerce and the public this Government always acts in the interest of Commerce. If Regulatory/Consumer/Criminal laws conflict with the interests of commerce the Regulators (and Government) will and do turn a blind eye.
Welcome to the innovative 'self regulating' UK market place.
BT thieved while soldiers died
While the four BT call centres were using auto diallers to defraud the MOD kitty out of an estimated £11m, soldiers were dying in Iraq through lack of affordable equipment.
BT Frauds are Protected by the Regulators
BT operate in the regulated sector and only the appropriate Regulator of that sector can forward criminal allegations from the public on to the police.
This will only ever be done on the say so of BERR (DTI).
That is why the £11m BT call centre fraud was never prosecuted.
That is why the Suffolk Police didn't prosecute BT for their part they played in the multimillion pound internet dialler fraud from 2004.
Throughout 2004 BT had been billing 3500 premium rate numbers belonging to Telecom One ltd which were mysteriously appearing on phone bills.
In June alone of that year the Regulator and BT received in excess of 25 complaints for each and every number. Despite the high level of complaint indicating the use of illegal software BT and Telecom One were allowed to continue billing and banking.
It wasn't until 2005 that Ofcom finally decided to order Telecom One to identify the internet services that BT had been billing for. Ofcom decided to close the case because the 'service provider' had left the 'market'.
Some of you guys should do some digging into the DTI/Regulator/BT cozy relationship.
Government sponsored TV programs being passed off as independent documentaries is entering into a very dangerous area.
Rip Off UK: Regulation and Corruption
Why are so many UK companies today being allowed to rip-off the public.
Water company accountants cooking the books in order to intentionally over charge their customers.
Four BT Call Centers using auto diallers for four years to generate calls that defrauded the Mod/Tax Payer out of millions of pounds.
BA and Virgin fixing the fuel surcharges in order to rip off their customers.
Super Markets fixing the price of dairy products.
Companies like mblox, Zamano, 2ergo, Dialogue, Opera Telecom...etc, that help third party companies send out unsolicited reverse billed premium rate text messages that debit mobile phone accounts.
The recent EU 'sweep' that discovered 39 of 43 UK Ringtone web sites were deceiving and swindling children....etc,etc.
Regulation and 'percentage' regulatory fines after the crime as been committed does not protect the public.
The Industries and directors within the 'regulated sectors' need proper policing and subject to criminal investigation and prosecution.
Government BT: But it's OK when BT customers are targeted with theft
In 2004 BT (Redstone) supplied B&B Services LLC premium rate telephone numbers to be used to bill on-line users for accessing internet porn sites.
These 'revenue share' numbers then started to mysteriously appear on the bills of thousands of BT's customers.
PhonePayPlus (Icstis) later fined B&B for using the numbers in illegal trojan dialler software,
Despite the tens of thousands of complaints BT received they insisted their customers were responsible for these bills because BT was not responsible for what people did on the internet.
It's strange that BT believe it's OK for 'companies' to defraud BT' customers through the internet and their billing platfom but completely wrong for a customer to download a damn music file.
BT and the Government are bloody hypocrites.
15 June: BT/Phorm to begin trials this week???
from an article in The Sunday Times
Competition fears depress LSE shares
INSIDE THE CITY
June 15, 2008
"After a troubled beginning, Phorm’s time may finally have come. The firm tracks the websites that internet users visit and serves them relevant display advertising. So far Virgin Media, Talk Talk and BT – where the latest trial of the technology begins this week – have signed up, keen to get a slice of the online advertising pie."
is this comment for real or is it to 'pump up' their share value
George Kidd is full of Premium Rate bullshit
Why have you written an article on 'spam'? People are complaining to PhonePayPlus regarding the unsolicited debiting of their mobile phone accounts for Premium Rate Services they did not request. The problem is not spam it's theft that the regulators refuse to report to the police.
The problem of unsolicited billing theft is not restricted to the UK. Class actions were filed against all the US cell phone carriers and companies like mBlox and Opera Telecom. In the last two days AT&T has recently agreed to refund their customers for charges they have incurred over the previous four years. It widely expected the other carriers will follow suit.
As for equating the epidemic of rogue dialler with spam:
Throughout 2004 (Jan-Aug) Icstis, now PhonePayPlus, received many tens of thousands of complaints concerning 09 premium rate numbers mysteriously appearing on peoples phone bills.
This is what they failed to tell the victims:
Twenty percent of all complaints concerned a block of 3,500 numbers(0909967****)supplied by Telecom One. Despite receiving numerous repeat complaints for each and every number BT were allowed to continue billing them for eight months.
It wasn't until May 05 that Ofcom finally told Telecom One to co-operate with Icstis's (PhonePayPlus) investigation. The investigation was closed because Telecom One's Majorcan 'service providers' had already left the market in August 2004.
PhonePayPlus and Ofcom are a damn disgrace at a premium rate.
BT pays £1.75m for call centre fraud
As reported in Daily Mail on 27 May 2008. This was only revealed after somebody used the Freedom of Information Act on the MOD.
BT had used four of their call centres to defraud the tax payer out of £10 million over a number of years.
THIS IS NOT THE TYPE OF COMPANY I WANT SNOOPING ON MY FAMILIES CONFIDENTIAL INFORMATION!
the PhonePayPlus scam Fine con
The trade body for the Mobile Network Operators (GSM) lobbied the Government to be exempt from the financial laws that regulate banks and credit card companies. WHY?
multi-million pound Scam revenue share:
Government 17.5% (VAT)
Mobile Network Operators up to 50% (according to vodafone)
PhonePayPlus 0.39% (Industry levy/cost of regulation)
Service provider (Zamano eg) & Content provider (2comm eg) share the rest
The Networks/Service providers withhold the revenue from the Content provider for 28 days. The fines are taken from this withheld revenue and under the Communications Act 2003 cannot exceed 10% of the revenue in question.
Each year the Industry levy is adjusted depending on the 'income' PhonePayPlus collects in the form of fines.
The Network Operators are billing on behalf of the same companies and these same companies are being 'fined' again and again for the same offences.
This unathorised (criminal) debiting of peoples phone accounts will not stop unless the Network Operators are subject to the same financial/criminal laws that banks and credit card companies are subject to.
Labour's utter contempt for the rights and wishes of the voter.
How many top Labour politicians are going to receive cozy directorships when they loose the next general election?
How many spineless backbenchers are going to regret they didn't speak out more in the defense of the rights of the electorate?
UK Government and BT's Dishonest Record on Internet Fraud
The issue of trust and honesty concerning all the parties involved in this personal data collecting/selling scheme should be considered.
@ el Reg. All this information is in the public domain. I believe it shows that BT is not a fit and proper company who should be trusted to prevent the potential fraudulent use of the data they intend collecting. I also believe it shows that the Government and Regulators should not be trusted to step in to protect the public when this data collecting scheme is abused (and it surely will).
Throughout 2004 (1st Jan to Aug) the UK public lost tens (hundreds?) of millions of pounds due to internet fraud in the form of "rogue diallers".
Throughout this period BT claimed they had no way of knowing if the numbers appearing on victims bills were the result or rogue diallers or the legitimate use of the customers PC.
What BT and the Regulators failed to tell the media and victims was that the level and pattern of complaint (concerning the same known numbers) clearly indicated that the bills were the result of the use of illegal dialler software. They failed to tell the media and the thousands of victims that 20% of all complaints they received in 2004 concerned the same UK company (Telecom One) and 3,500 known premium rate numbers (0909 967 ****).
In an article in The Guardian (July 2004) it was reported that Icstis (PhonePayPlus) had received "at least 25 complaints" during June 2004 for each of the three Telecom One numbers mentioned in the story.
At the same time as the Regulators were allowing BT to continue billing for the 3,500 Telecom One numbers BT were also billing for their own Redstone numbers that were later discovered to have been programmed into illegal diallers.
Despite the high level and serious nature of complaint Ofcom only acted in August 2004 after increasing media pressure. They finally introduced vetting on the internet diallers. It was later revealed in an Ofcom case (May 2005) that Icstis had requested information from Telecom One in February 2005 regarding the services being billed using their numbers. The Ofcom case also revealed that by the time Icstis had requested this information and reported Telecom One they had stopped receiving complaints regarding the 3,500 numbers. Ofcom decided to close the case because Telecom One's service providers had apparently left the market.
Before we allow BT to collect and sell our personal date I believe people should ask serious questions into the apparent inability of Government and regulators to prevent the telecoms networks and the internet being used to target the public with such high levels of serious organised fraud.
May be PhonePayPlus (Icstis) could open a virtual office on the site. They could log virtual complaints from virtual customers. Carry out virtual investigations. Have virtual adjudications and levy virtual fines.
That would mirror real life.
The Direct Marketing Association UK is Europe's largest trade association in the marketing and communications sector. The DMA was formed in 1992, following the merger of various like-minded trade bodies, forming a single voice to protect the direct marketing industry from legislative threats and promote its development.
Phorm and BT both fail the Due Diligence test
"We believe BT Webwise is an important improvement to your online experience - giving you better protection against online fraud"
The Register should look at BT's record concerning online fraud and protecting it's customers. I believe its time a few chickens came home to roost.
In 2004 BT(Redstone) supplied B&B Services LLC with revenue share 09 premium rate numbers to be used to sell on-line porn.
Thousands of BT customers complained that these numbers were appearing on their bills and they were being billed for internet services they had not requested or received.
Despite BT being fully aware of the epidemic levels of internet fraud using trojan dialler software, BT continued to insist the bills must be paid.
The Sunday Times investigated and discovered BT had failed to carry out any due diligence check on B&B.
From the Icstis Adjudication:
Members of the public complained about charges incurred as a result of connecting to the Internet through premium rate numbers.
Complainants stated that they had not agreed to connect to any premium rate service and claimed that the dialler software used must have made repeated calls without their knowledge or consent (4.3.1b and 4.1.3 tenth edition).
As complainants appeared to be connected to the services without their knowledge, they were unable to supply details of where or how the services had been promoted. They did, however, supply copies of their telephone bills, which showed successive calls resulting in high bills.
I for one do not believe BT or any of their friends are fit and proper people to be trusted with the information they propose to collect.
Profiling Potential Scam Victims?
As I understand it BT will not be giving Phorm our identities but they will be giving them our internet 'addresses'. They will also be giving them a complete profile of the type of person at that address.
Would we want Royal Mail to give our addresses and a complete list of the organisations we communicate with to unknown third parties? Certain mass-marketing 'companies' that currently target us with various scams would love that type of information.
"Urgent! PhonePayPlus SMSus '2 Good 2 B True.'"
The PhonePayPlus (Icstis) SMSus 'service' (at 12p a pop) is little better than any of the premium rate phone-in scams.
PhonePayPlus could and should have a search-able data base of accredited premium rate services. This should include contact details, costs and the numbers they are being operated on.
Potential victims could then make up their own minds if they want anything to do with companies like Zamano, Opera, Dialogue, Eckoh, Hybyte, mBlox, etc,etc.....who have long histories of complaints for repeat 'scam' offenses.
Unsolicited reverse billed sms text messages should be considered a criminal matter and dealt with by the police and not 'investigated' by PhonePayPlus.
Opera Telecom and BT RIDE also fingered
This is taken from the Icstis Oral Hearing concerning the GMTV phone-in 'scandal'.
Did BT know they were taking their customers for a 'RIDE'.
19. A further issue investigated by ICSTIS was the use of overflow platforms. The servers operated by Opera could deal with some 1,200 simultaneous callers, but at busy times as may as 10,000 viewers would call at once. The excess would be transferred to other handlers. In the later stages of the Competition, the entire overflow was handled on the RIDE platform operated by BT. No finalists were ever selected from the BT platform, yet the callers would be charged as usual. Entrants whose calls were transferred to the RIDE platform were therefore always disenfranchised.
20. A further allegation raised by a Mail on Sunday article of 29 April 2007 and investigated by ICSTIS was that for a period during February 2007 there were technical difficulties with the telephone lines, and accordingly all finalists were selected from SMS entries. It was accepted by Opera that from 8 February to 20 February 2007 all callers to the 090 number were transferred over to the BT RIDE overflow platform, which meant that the callers would still be charged but that they had no chance of winning. For the eight competition days in question only those entering by other means were selected as finalists. Viewers were not informed at any time during this period that those entering by telephone could not win.
Dated this 24th day of September 2007
76787 scam alert!
So another dodgy sounding premium rate company is offering another dodgy phone service at 12p a pop.
Ed Richards should be tweaked at the domestic level
Yes Ofcom have always acted in the interest of UK Industry and look at the damn expensive mess it's left the UK consumer with.
Forcing them to act in the interest of EU industry? Will that be of much benefit to the UK consumer? I doubt it somehow.
Should the UK public be rallying to arms in the defence of Ofcom's sovereignty? On balance and taking everything into consideration I think Ofcom and Ed can go and take a flying..............
which f*cking fingers to break.
"In which case you're left with the dilemma of which fucking fingers to break"
The fingers of any of the companies who are prepared to accept money to send the anonymous texts on behalf of these idiots. Pick a finger.
M X Telecom
The same companies that also make millions of pounds every year by sending unsolicited reverse billed (theft to me and you) text messages on behalf of anonymous third parties registered in the British Virgin Islands.
- Xmas Round-up Ghosts of Christmas Past: Ten tech treats from yesteryear
- Analysis Microsoft's licence riddles give Linux and pals a free ride to virtual domination
- Special Report How Britain could have invented the iPhone: And how the Quangocracy cocked it up
- Massive! Yahoo! Mail! outage! going! on! FOURTH! straight! day!
- Bring it on, stream biz Aereo tells TV barons – see you in Supreme Court