The Miserable Rewards of US Mobile Ad Fraud

A long article in Vice has reported how “ordinary Americans are using armies of phones to generate cash to buy food, diapers, and beer through ad fraud.” That makes it sound a lot more interesting than the rest of the piece, which found that fraudsters have spent thousands of dollars on creating ‘phone farms’ but now only generate a tiny return on their investment.

Joseph D’Alesandro, 20, made nearly $2,000 a month from phone farming back in 2017, he told Motherboard in a phone call.

That was the high point, mentioned near the start of the article, and you can bet the journalist did not verify this scammer’s earnings. Much later on the reader is told:

D’Alesandro’s $2,000 a month revenue high didn’t last. In 2018, there was a “very sharp downfall” he said. Advertisers started to crack down. “I think the people putting money into it weren’t exactly sure how it was being used,” he added.

Consider the paltry returns for the following scammer, even if he managed to buy his phones for the improbable cost of only $10 each, which was the lowest estimate given in the article.

Goat_City, the farmer who had over 100 phones, said they’re only making around $10 a day now.

These ad farmers also have to pay for electricity, and then have the mind-numbing task of monitoring their devices to ensure they keep working.

“Not everyone wants to spend their free time clicking at screens to make fractions of pennies every hour, especially if they have families, friends, and living life in general to attend to.”

There is a natural tendency to hype fraud in order to justify the work done to prevent it. But the US businesses that have been clamping down on fake internet accounts and the abuse of online adverts can take some comfort from Vice’s investigation. The best US fraudsters are only making a pittance from fraudulent ad clicks. But perhaps they could recoup some of their investment by selling their used $10 handsets for $5 on eBay…

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 Chief Executive 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.