Interview: Guy Howie Talks about Fraud, NPM and Working with RAG

Guy Howie (pictured) is the boss of Biaas and an expert in the billing accuracy and fraud issues created when telcos fail to use valid data to configure their tariff reference data and fraud management systems to match dial plans in their own country and overseas. Earlier this year he wrote the response of the Risk & Assurance Group (RAG) to the UK regulator’s consultation on changes to the 070 number range, which has long been a magnet of fraud. His recommendations were echoed in the responses of various telcos and interested parties, including BT and academics at EURECOM. Now he has partnered with RAG to offer number plan management (NPM) services to telcos worldwide. Our interview began by asking about the reasons to work with RAG.

Commsrisk: You already run a successful business with major telco clients around the world. Why did you want to form a partnership with RAG?

Guy: We are always seeking to offer enhanced, new and innovative services to a wider audience, especially in the continually evolving world of fraud prevention. RAG has a very wide reach as a community and is recognised as the number one authority on controls for revenue assurance and fraud management in the telecoms industry. My company, Biaas, have been leaders in number plan management since 2007. The combination felt natural.

Plenty of telcos need better number plan data but do not know where to get it. RAG, with the events it runs around the world, and now with its online services, has done a valuable job of educating communications providers about specific risks and how to mitigate them. It made sense to provide Biaas’ expertise to RAG’s international audience.

RAG has worked with Biaas to construct a free proof of concept for telcos, showing them a very quick and painless process which can be performed remotely and securely. The aim is to deliver visibility of real frauds from real data, together with the reasons why Biaas identifies them as frauds. We believe that sharing such knowledge about frauds within an operator will help enhance understanding of fraud profiles, while also giving RAG audience members a valuable and rare opportunity to implement better targeted and designed internal controls.

How is your area of expertise relevant to fraud management, and what have been the findings?

We initially developed our fraud database solutions because there is a recognized need in the industry for sharing expert knowledge about international destinations. Over the years we have often been asked by various members of the industry to bring our NPM expertise to bear on managing fraud reference data. Specifically, we have identified four areas where our products can have a positive impact.

First, increased efficiency of fraud alerts – delivering less false positives, and better prioritization. We find that there are many fraud systems monitoring voice traffic across the telecommunications space. Some are old with only a few algorithms, whilst some are new with highly sophisticated AI processes. Surprisingly, there are still lots of telcos which have no vendor fraud system in place at all. Many fraud systems seem to generate far too many low quality alerts; you might call them ‘false positives’. These generate a lot of unnecessary work and expense. Sometimes telcos are so busy investigating false positives that they fail to deal with real frauds on a timely basis. We are proving that fraud intelligence data can improve efficiency in all these situations by allowing alerts to be targeted more effectively towards areas where frauds are likely to occur. Because we offer fraud intelligence data rather than a complex IT system/computational solution, the product is flexible and suits all telcos. It can be integrated into existing systems with a minimum of lead time, and can be used in cases where there is no pre-existing FMS to accompany it.

Secondly, we have a reasonably priced solution. Following multiple discussions, it is apparent that the same simplicity which makes our solutions so flexible also means we are able to offer them for a price which is accessible to all our potential customers, including the very small operators.

Third, there is constant maintenance by experts in the field. Fraud destinations change rapidly, so this change needs to be managed at the same pace. The observation is that many fraud systems have reference data today, but this data can be frighteningly out of date, lacking in scope, and so massively underutilized. Biaas has invested 18 months effort into product development for fraud intelligence data, and we are now finding this investment makes us naturals when it comes to keeping one step ahead of potential fraudsters and identifying newly emerging fraud hotspots. Our past experience also means we are used to working to the highest level of accuracy. Our core business model has always revolved around constant maintenance and management of new developments within global numbering plans.

And fourth, we work at fraud prevention at the level of the network. We have proven that Biaas data can easily and effectively be used to block unwanted and invalid traffic in different situations such as roaming voice and outbound international voice, and the accuracy and continual updating means we are not blocking legitimate routes.

It is easy to use the word ‘data’, but hard to visualize it. What does the Biaas data look like?

When it comes to voice, our fraud reference data has four main classifications: unallocated destinations; invalid digit string lengths (DSLs); higher cost destinations; and international revenue share fraud (IRSF) test numbers.

Starting with unallocated destinations, many obvious frauds contain calls to destinations which have not yet been allocated for use by national operators. Our unallocated destination lists can be used for various purposes, such as triggering alerts to ongoing or attempted frauds. They can also be used as part of a control strategy to block traffic at the switch or international gateway, stopping attacks before they begin.

Next we can consider the length of a phone number. All international destinations have clearly defined parameters for the maximum and minimum length that a dialed number should be. Fraudsters often use numbers which do not meet these parameters, usually because they don’t believe they’ll by impacted by them. By having the relevant data in place, telcos can label traffic with incorrect DSLs, thereby preventing frauds.

High cost destinations are important because fraudsters often aim to exploit them. Our analysts use a smart labeling system for types of higher cost destinations, allowing for different types of FMS monitoring and alerts. Different levels of prioritization can be assigned to separate categories of high cost destination. Our thresholds for what qualify as high cost destinations are dynamic and continually updated, and vary from country to country, reflecting the fact that fraud ‘hot destinations’ tend to move around.

IRSF test numbers are a great intelligence asset. Many frauds begin with calls to test numbers, which are exploitable high cost destinations available in online lists. We pull these test numbers from the same sources used by the fraudsters themselves and maintain them in a continually updated database. These test numbers can act as an early warning system, triggered when they receive new traffic. Test number activity can also be used to tailor the way decisions are made regarding high cost classifications.

Thanks Guy. That is a lot of information to absorb. How can people learn more?

The obvious advice is to go to the RAG-Biaas NPM web portal. Doing a proof of concept is a quick and painless way to see the results in practice and to make them relevant for the needs of the specific telco. And because it’s offered without charge the telco gets a risk-free opportunity to validate the benefits of utilizing NPM intelligence.

Eric Priezkalns
Eric Priezkalns
Eric is the Editor of Commsrisk. Look here for more about the history of Commsrisk and the role played by Eric.

Eric is also the Director of the Risk & Assurance Group (RAG), a global association of professionals working in risk management and business assurance for communications providers.

Previously Eric was Director of Risk Management for Qatar Telecom and he has worked with Cable & Wireless, T‑Mobile, Sky, Worldcom and other telcos. He was lead author of Revenue Assurance: Expert Opinions for Communications Providers, published by CRC Press. He is a qualified chartered accountant, with degrees in information systems, and in mathematics and philosophy.