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I'm really sorry if this is posted in the wrong section. I did spend some time trying to get it right but I am not sure if this is...

I have been exposed to thieves who have stolen my phone and then made over 500 calls an hour where some of the calls cost up to $500. Of course I have blocked my SIM card, but the damage has been done and I am very curious about how the phone companies can let this go through so easily.

I have been in touch with my phone provider (and during the incident I was abroad). My phone provider says they are still negotiating with the abroad phone provider. My phone provider is also a very small company but they said they've been working day and night with this issue.

I will be very straight to the point and ask the questions that I am very curious about:

  1. What device do the thieves use in order to make hundreds of calls per minute?

  2. How can the organizations who make the calls with the stolen phones not get caught? I mean every single transaction is tracked and in order for the thieves to withdraw any money they should have to provide an identity, and bam they should be easy to track down and get charged for the crime?

  3. How can the phone providers (who probably deal with this every day) not be able to block transactions of tens of thousands dollars that are going from one phone to the organizations keeping? It feels like the phone providers are getting paid by the thieves, as long as the phone providers let's those transactions through.

  • Welcome to security.stackexchange! I am sorry you are going through such a horrible experience, and I hope someone is able to provide a useful answer. Could you specify what country you are in (I would imagine the process for dealing with things like this differs per country)? You may also want to check out the site tour under "help" to see more about how this site works. – Jonathan Dec 12 '14 at 17:01
  • One thought is that you might want to ask each question separately. This way, you can mark for each one when someone provides the answer you need for each question. – Jonathan Dec 12 '14 at 17:05
  • The fraud department is holding you responsible? – Andrew Hoffman Dec 12 '14 at 17:28
  • I am not an english native speaker, but by fraud department, do you mean my phone provider? They are "on my side" but they say that they might not be able to stop the transactions. They are currently negotiating with the abroad phone provider. – Zerderwerer Dec 12 '14 at 17:33
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I will answer this based on a vast amount of experience while working at an ITSP

What device do the thieves use in order to make hundreds of calls per minute?

Toll fraudsters can install mobile to voip based apps which connect your mobile device to a Voice Over IP device. The VoIP trunk is then making making calls under your credentials. It works like this:

YourPhone (via mobile to VoIP app) --> make a VoIP call --> rogue VoIP trunk
rogue VoIP trunk --> generate xAmount of calls --> trunk provider

How can the organizations who make the calls with the stolen phones not get caught? I mean every single transaction is tracked and in order for the thieves to withdraw any money they should have to provide an identity, and bam they should be easy to track down and get charged for the crime?

You're dealing with an international issue of which there is no fix. When a call is made it works like this:

Your carrier --> another carrier --> another carrier --> 1..3 --> end destination

Each carrier acted in good faith to place the call for you. There was no way any provider (except the rogue ones) would know a call was fraudulent. Now, in a most cases that I have dealt with, it worked like this:

Victim's Phone (US) --> another US carrier --> carrier in say England --> carrier in Africa

Our laws don't apply in Africa, so it would be more costly for a carrier to go after someone in Africa being they'd have to sue the carrier in England, and the carrier in England would have to sue the carrier in Africa. It is more cost economic for carriers to "re-rate" the calls and bill you for the amount they stand to pay versus the wholesale amount.

How can the phone providers (who probably deal with this every day) not be able to block transactions of tens of thousands dollars that are going from one phone to the organizations keeping? It feels like the phone providers are getting paid by the thieves, as long as the phone providers let's those transactions through.

Regulatory controls (gotta love them). Years ago, Sierra Leone was a known hotspot for fraudulent calls and engineers worked with many vendors to notify them of this however, there was no mechanism to outright block countries known for heavy fraud. There were too many variables (e911, etc). Some carriers outright don't care to stop it, as some profit off of it at the end of the day.

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    Thanks for the reply! I just don't get why my phone provider just can't say "This is clearly a fraud and we have cancelled the transactions". I mean it is clearly a fraud, and technically I "owe" the thieves a lot of money right now, but since this is a fraud and it is obvious that I should not pay the money, why can I just not pay the money and everyone will be happy, except for the thieves who gets no money? I mean at the moment there is no company who have paid any real money to the thieves, right? It's only in numbers at the moment, numbers that says that I owe the thieves money? – Zerderwerer Dec 12 '14 at 17:07
  • Your provider likely has to follow many rules and regulatory controls (especially if they are in the US (FCC)) to ensure they are acting appropriately. Otherwise imagine the following: someone with a sexual addiction dials a porn hotline/chatline racking up thousands of dollars legitimately, then calls his provider and says: "Wasn't me." You could fight your provider via way of credit disputes, etc., but again, now your credit report takes a hit while its all sorted out. – munkeyoto Dec 12 '14 at 17:10
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    @Zerderwerer How to negotiate with customer support representatives is not on-topic on security.stackexchange.com. When you think you don't have to pay the bill but the company thinks you do, get a lawyer. – Philipp Dec 12 '14 at 17:36
  • Zerderwerer - munkeyoto and Philipp are correct. Your initial question (1) is on topic here, and (2) and (3) sort of. Normally we'd remove them to separate questions, but munkeyoto gave an excellent answer covering all 3. Your comments since then are off topic - as they are contractual/legal between you and your provider. They are not technical. – Rory Alsop Dec 12 '14 at 18:03
  • So my phone provider might already have sent the money to the thieves, and are now waiting for me to pay them (the phone providers)? – Zerderwerer Dec 12 '14 at 18:24

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