Telco employees are deeply involved in mobile money fraud, according to police.


The rate at which mobile money subscribers are being duped by criminals and telecom company employees has reached frightening proportions. 

The program, which was hailed as a game-changer for bringing banking to the unbanked, is turning out to be a monster that is robbing poor people of their meager savings. 

What's more concerning is that the use of phony identities makes it extremely difficult for security authorities to trace down the criminals. 

According to Chief Superintendent Dr Herbert Gustave Yankson, the Director in Charge of the Ghana Police Service's Cyber Crime Unit, the unit is only able to investigate and prosecute 10% of instances reported due to bogus IDs.

Mobile money is a ticking time bomb. 

He portrayed mobile money as a ticking time bomb that will blow unless something serious is done to stop the system's growing deception. 

50 percent of subscribers have been a victim of fraud or have been a target of fraud. 

At least five out of every ten mobile money customers has been a victim of fraud or has been a target of mobile money fraudsters/scammers, according to estimates. 

How are subscribers selected? 

Subscribers are primarily targeted by SMS, phone calls, e-mails, and social networking platforms, among other methods.

The rise in reported fraud cases involving unethical individuals and mobile money service confidence tricksters is weakening trust in the system. 

Employees from telecommunications companies are participating. 

What's more alarming is that the Cyber Crime Unit detained employees of mobile telecommunication providers who illegally accessed the databases of the companies for which they work and used the information to perpetrate mobile money fraud. 

Employees of telecommunications companies penetrate a database. 

The Finder discovered that these employees gain unauthorized access to mobile money merchant databases and modify clients' registration details in order to withdraw money from their accounts.

These staff of telecom companies who are in league with criminals then reset the number with the money to a new owner in the database, which gives the new owner access to change the PIN and withdraw monies.

They then acquire new SIM cards and use the pins to withdraw monies from merchants.

Other modus operandi of the fraudsters

Initially, the fraudsters could send a text or call and tell subscribers that they have won some lottery so they should send them money to claim their prize. The moment subscribers send the money, the fraudsters withdraw it and get rid of their SIM so that subscribers can never reach them again.

Their recent strategy is to call subscribers and tell them that there is a problem with account and offer to help resolve the problem.

For instance, victims are told that an amount they received in their account has been wrongly transferred as airtime, and the criminals offer to assist subscribers to convert it back to cash.

The fraudsters then ask subscribers to get another phone so they can take the subscriber through the process, and if the subscribers are not conversant with the system (like most users who do not understand English properly and hence cannot figure out what they may be doing), the criminals make subscribers to generate a code for an ATM withdrawal or get subscribers to send money to their phones, and they bolt with it.

Other criminals also call and tell their victims they have wrongly sent money to their account so they beg the subscribers in the name of all the deities to send it back to them, and once the subscribers do that, the criminals withdraw immediately and get rid of their SIMs.

As the newest fraud technique emerging, some subscribers, without having performed any transaction, receive text messages of withdrawal of money from their accounts.

Money laundering

Dr Yankson sees mobile money as fertile ground for money laundering considering the volume of money circulating through mobile money.

Is BoG monitoring money laundering through mobile money

Till date, the Bank of Ghana (BoG) has not made any pronouncement on monitoring of mobile money for money laundering transactions.

Sale of pre-registered SIM cards

Chief Superintendent Dr Yankson explained that agents of telecom companies are selling pre-registered SIM cards in contravention of the law.

Use of fake identities for SIM cards registration

In addition, he said the fraudsters also use fake identities to register SIM cards, and this is possible because the telecom companies are not doing real-time and post-registration verification of identities presented by subscribers.

He stated that the telecom companies always use the lack of a national database as excuse for not doing real-time verification.

Telcos say private solutions expensive
Even though there exists solutions developed by private companies, he said, the telecoms say they cannot afford.

Proceeds of crime hidden on mobile money

Chief Superintendent Dr Yankson disclosed that use of fake identities has made it easy for criminals to also use mobile money to receive and hide proceeds of crime. He noted that when the right identity is used in registration, it makes fighting crime such as mobile money fraud easy and less expensive.

Chief Superintendent Dr Yankson advised mobile money subscribers to change their Personal Identification Numbers (PIN) at least once every month, not to save their PIN Codes in their mobile devices, password protect their phones, and not share or give their PIN out to third parties.

Law on SIM card registration

Parliament in 2012 adopted the Subscriber Identity Module Registration Regulations, 2011 (L.I. 2006) to give backing to SIM card registration in the country.

Failed SIM card registration

Telecom companies were made to register all SIM cards, but at the end of the exercise, it was discovered that the registration was full of fake identities and other challenges.

SIM card registration to be done again

Consequently, the government at the time decided that the registration should be repeated when the National Identification Authority builds the national database of all Ghanaians.

Source: Africanwish

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