Irrespective of a communication providers’ size, a CFO or Finance Director’s nightmare is to have to explain to his executive team, to his shareholders, to his/her own customers, even the general public in some instances, why they didn’t detect an ongoing financial loss or couldn’t prevent a sudden fraud hit.
The increase in scale and complexity of fraud types around the world creates situations of genuine uncertainty for operators and in turn, their financial controllers. No operator wants to constantly face the threat of being attacked by fraudsters and of having hundreds of thousands or even millions of dollars wiped off their bottom line in a single incident.Yet we see this happening, a lot.
But what price is worth paying to stay protected from financial losses?
August is known to be the busiest month out of the year for telecommunications fraud, as criminals take advantage of summer plans and holidays. This summer is likely to bring with it a host of new exploits and attacks – and you must assume that your company will be targeted. This summer telecom operators should spend their time bolstering their security efforts, through the adoption of increased technology and awareness training.
In 2017 alone, the CFCA estimated that US$29 billion was lost due to telecom fraud. Telecom fraud is four times larger than credit card fraud, yet it's less often discussed in the media. Telecom companies need to protect themselves through the use of reliable telecom fraud management solutions, if they want to avoid costly surprises for their customers. Most telecom companies will see some level of fraudulent traffic - whether they are able to identify this traffic will depend on the tools at hand.
Also known as the Pareto Principle, the 80/20 rule can be roughly applied to virtually any business need. In the 80/20 rule, organizations are able to get eighty percent of their results using twenty percent of their resources. In sales, 80 percent of all sales may be completed by the top 20 percent of employees. In fraud management, 80 percent of fraud can easily be detected and mitigated with 20 percent of the effort. Many business owners believe that they can't afford fraud management, when in fact, most fraud can be managed affordably using the right solutions.
In September last year, the CFCA published the findings of its latest fraud loss survey revealing that Telecom Fraud has cost the industry an estimated $29.2bn in 2017, which comprises 1.27% of total global telecoms revenue. The good news is that while this is a better result than the previous 2015 survey, the bad news is that fraud remains one of the biggest revenue risks to operators globally, with IRSF in particular remaining the most prevalent type of fraud attack experienced.