Fraud prevention technology will cut toxic revenue for mobile network operators (MNOs), keep customers safe, safeguard user experience and cut down complaints. That’s according to mobile technology company, Upstream, who appeared at the Global Carrier Billing Summit 2020. During the virtual event, Head of Secure-D at Upstream, Geoffrey Cleaves, shared his concerns about the increased sophistication of fraud technology and what MNOs can do to keep their customers safe.
Participating in the panel discussion “Friend or Fraud? Perfecting the balance in protecting consumers and preventing customer complaints” Cleaves warned against MNO’s passive reliance on “toxic” fraud-based revenue streams, arguing they do far more harm than good in the long-term. He described anti-fraud technology as being “essential” and “necessary” as MNOs continue to devise their digital transformation strategies. “When we first started our implementation with a major South African operator, customer complaints were at an unacceptable level and more than 90% of purchase transactions were fraudulent. We saw over 1 million infected devices. Today, customer complaints are at 0.5%, calls to the call center down by 75%, and fraud is attempted at a much lower rate”, the Upstream expert noted.
Cleaves went on to give some examples of sophisticated threats customers have recently been faced with, singling out the Joker OTP malware, which is constantly reinfecting Google Play apps and signs users up to paid premium services without their consent. He also referenced the “relentless” xHelper malware which, as reported by Upstream earlier this year, came pre-installed on thousands of low-cost devices manufactured in China.
In 2019 alone Secure-D, Upstream’s full-stack anti-fraud platform which covers 31 mobile operators in 20 countries, blocked 1.6 billion fraudulent transactions, preventing $2.1 billion in fraudulent charges. During the same time Secure-D identified and blocked 98K malicious Android apps and 43.3 million malware infected mobile devices. According to more recent data the total number of mobile apps identified as malicious had doubled between Q1 2019 and Q1 2020, totaling 29,000. The beginning of 2020 also saw a 55 percent spike in the number of fraudulent mobile transactions, indicating that the majority of fraud cases are financially motivated.
“As fraud becomes more sophisticated, operators must use more sophisticated tools to combat it,” Cleaves commented. “The pandemic has driven more people online, attracting bad actors who see it as yet another opportunity to steal and profit by tricking unsuspecting users.”
He then went on to talk about how MNOs should balance the need to protect customers while providing competitive, seamless user experience. “One should not come at the cost of another,” he explained. “A good fraud prevention mechanism should improve the customer experience, not impair it like OTP or captcha.” As was highlighted, it should be perfectly possible to protect customers from malicious malware without the need for one-time passwords or captcha technologies which, even when well implemented, can be inconvenient and time-consuming.
Moving onto the industry at large and its efforts to combat fraud, Cleaves turned his attention to self-regulation and the “important work” being done by the Mobile Ecosystem Forum (MEF) in their publication of educational whitepapers. He referenced the self-regulating bodies in South Africa and the Netherlands, highlighting their impressive knowledge around fraud and the steps they were taking to combat it. When asked what kind of role self-regulation could play in helping the Direct Carrier Billing industry, Cleaves described it as “fundamental”, explaining that local groups should establish the ground rules for participating in a market – including the need for anti-fraud technology – and that state regulator should have the power to step in if required.
Secure-D, is Upstream’s proprietary mobile anti-fraud platform, combating mobile ad fraud at the operator level. The solution processes mobile transactions via applied machine learning and behavioural analytics and tackles the threat protecting CB transactions. For the MNOs Secure-D has meant safe revenues from digital acquisitions, 100% clean from fraud, increased revenue per user and a seamless, safe, complaint-free customer experience. Secure-D has been shortlisted “Best Carrier Billing Fraud Solution 2020” at the GCB Awards.
The Global Carrier Billing Summit 2020, which for the first time was made exclusively virtual due to the pandemic, brings together hundreds of mobile carriers, service aggregators, digital merchants, content providers, regulators and technology providers from around the world.