SOURCE: Argyle Data

Argyle Data

February 11, 2016 08:00 ET

Is International Revenue Share Fraud the Major New Mobile Communications Crime Frontier

Continuing a Series of Commentaries on the Communications Fraud Control Association's 2015 Global Fraud Survey Examines the 500% Rise in International Revenue Share Fraud Since 2013

SAN MATEO, CA--(Marketwired - Feb 11, 2016) - Dr. Ian Howells, Chief Marketing Officer of Argyle Data, the leader in native Hadoop applications for revenue threat analytics in mobile communications, has released the third in a series of articles analyzing the results of the 2015 Global Fraud Loss Survey published by the Communications Fraud Control Association (CFCA). In particular, Howells looks at the reasons why international revenue share fraud grew by 500% between 2013 and 2015, representing a global loss of US$10.8 billion to mobile operators.

"There has been a dramatic change in the top ten most costly types of global fraud between 2013 and 2015," Dr. Howells noted. "I examined the underlying reasons for some of these changes, using our experience working with major mobile operators to try to explain this shift."

Top 10 Global Fraud Types in 2013 Top 10 Global Fraud Types in 2015 (with % change from 2013)*
1. Roaming fraud - $6.11 billion 1. International revenue share fraud - $10.8 billion (500% increase)
2. Wholesale fraud - $5.32 billion 2. Interconnect bypass fraud - $6 billion (200% increase)
3. Premium rate service fraud - $4.73 billion 3. Premium rate service fraud - $3.8 billion (20% decrease)
4. Cable or satellite fraud - $3.55 billion 4. Arbitrage - $2.9 billion (32% increase)
5. Device/hardware reselling - $2.96 billion 5. Theft/stolen goods - $2.8 billion (104% increase)
6. Service reselling - $2.8 billion 6. Device/hardware reselling - $2.3 billion (22% decrease)
7. Arbitrage - $2.2 billion 7. Domestic revenue share fraud - $2.1 billion (163% increase)
8. Theft/compromise of data - $2.2 billion 8. Wholesale fraud - $2 billion (62% decrease)
9. Interconnect bypass fraud - $2 billion 9. Commissions fraud - $1.5 billion (26% increase)
10. International revenue share fraud - $1.8 billion 10. Service reselling - $0.9 billion (68% decrease)

*Note: Roaming fraud, the top fraud type in 2013, was not included as a fraud type in CFCA's 2015 report due to a new method of analysis. More detail on this change can be found here.

"When you look at these numbers, the most striking change in 2015 is the 500% increase in international revenue share fraud (IRSF), which now single-handedly accounts for 28% of the entire $38 billion fraud market," said Dr. Howells. "This is especially remarkable considering that premium rate service fraud, a fraud type that is perpetrated by similar methods as IRSF, saw a 20% decrease over the same time period."

This can perhaps be better explained by examining the definitions of these two fraud categories:

  • International revenue share fraud: artificial inflation of traffic terminating to international revenue share providers
  • Premium rate service fraud: artificial inflation of traffic terminating to premium service providers

"We believe the leading mobile operators have been moving to a real-time architecture that allows them to detect premium rate service fraud more quickly and bar the number, thus stopping the inflation of traffic to that number," added Dr. Howells. "However, barring a number is much easier than barring an operator or an entire country to stop IRSF."

The top 10 countries where fraud terminated in 2015 were Cuba, Somalia, Bosnia and Herzegovina, Estonia, Latvia, Guinea, Serbia, Sierra Leone, United Kingdom, and Lithuania.

Dr. Howells also suggests that, as sophisticated attacks are constantly evolving and difficult to discover, actual growth figures are likely to be higher than those reported. "The rewards of mobile fraud are huge -- minutes mean millions in some high volume attacks. But this analysis clearly illustrates the complexity and ever-changing nature of mobile revenue crime, and the need to match these threats with innovative and agile detection techniques."

In a number of instances, operators are focusing their fraud prevention strategies around real-time, machine learning detection techniques based on native Hadoop technologies that deliver the speed and agility required to uncover new fraud types as they occur.

Mobile World Congress
Argyle Data will exhibit at the Cloudera booth at Mobile World Congress (Stand 6M30, Hall 6). Visitors to the booth will receive a free copy of Argyle Data's book, Fighting Future Fraud: A Strategy for Using Big Data, Machine Learning, and Data Lakes to Fight Mobile Fraud.

About Argyle Data
Argyle Data is used by the world's leading mobile operators to detect the fraud, profit, and SLA threats that cost the industry $38 billion dollars per year. Argyle Data's industry-leading native Hadoop application suite uses the latest Hadoop and machine learning technologies, proven at Facebook and Google, to identify the revenue threats and attack patterns being waged against mobile networks in real time. To learn more please visit:

Argyle Data Website
Fraud & Technology Wire
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Contact Information

  • Contact:
    Mary McEvoy Carroll for Argyle Data
    Email: Email Contact
    Tel: + 1-408 691 4283