A Taxonomy of Fraud Experienced by Network Service Providers (2020)

By Kevin Taylor & Michael Khalilian, Comcast; Steve Goeringer, CableLabs; Eric Winter, Cox Communications

All service providers and retail businesses experience crime in the form of fraud. Fraudsters seek to monetize cyber crime and other crime by targeting our companies, our partners, and our customers.

Annual fraud losses in the US represent a staggering $170B across all fraud types. Many of these fraud types apply to the provider’s technical and financial operations including card fraud ($32B), online fraud ($26B), identity fraud ($16B), check fraud ($7B), synthetic fraud ($6B), account takeover ($5B), and new account fraud ($3B). The methods to execute fraud vary from simple to very technical. In the fraud environment operators face today, fraud incidents are often proceeded by cyber security events.

This requires a greater coordination and collaboration between fraud teams and cybersecurity teams. The fraudsters are creative and coordinated – they attack all aspects of our businesses, including care channels, video, wireless, Internet, mobile and voice services. This paper provides an overview of some examples of fraud experienced by cable operators, and then proposes a framework for fraud and a taxonomy, in order for it to be effectively described and discussed.

What is fraud? Why is it important? Operators are seeing an increase in external fraud resulting in service theft, device theft, and brand damage. In some cases, bad actors use compromised personal and payment information to create fraudulent accounts, or they may use Internet fraud resources to create fully synthetic identities. They may use modified devices to provide video and Internet services to customers they are servicing. Other approaches have been identified as well. In some cases, the subscribers working with the bad actor believe they are working with their actual carrier. Both wireline and wireless operators are being targeted across the globe.

There are many types of fraud being executed against cable operators and their partners. These may target the operators themselves, their customers, or even their business partners. We’re focused on fraud that impacts the operator’s service and the consumers of those services.

Different industry segments and their products experience fraud differently. Voice, internet, mobile, email, and video fraud all have characteristics that are unique to the operator and the product line. Supply chain and fulfillment may be part of fraud, as well – such as when a fraudster arranges for cell phones to be shipped to a certain location or sets up a new cable account resulting in shipment of cable modems and set top boxes.

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