Call Center Fraud

Call center fraud is a growing threat, targeting businesses as well as their customers and employees. Taking advantage of the highly accessible nature of call centers and the eagerness of agents to help would-be customers, fraudsters seek to deceive agents, manipulate systems, and steal sensitive data or money. Call center fraud is increasingly sophisticated, leveraging advanced social engineering techniques, technology, and insider threats to achieve its goals. Because organizations have focused more heavily on protecting data networks than on telecom security, fraudsters often have fewer obstacles to overcome when exploiting security vulnerabilities in call centers.

Combating fraud requires businesses and their call centers to have a realistic understanding of the threat and to adopt multilayered strategies for call fraud detection and prevention.

How Call Center Fraud Works

While fraudsters are continuously finding new ways to attack and deceive call centers, most efforts follow a similar pattern of activity:

  • Information Gathering Fraudsters collect personal data about their targets from various sources, including data breaches, social media, or phishing campaigns. This information allows them to impersonate legitimate customers or employees when contacting a call center.
  • Contacting the Call Center Using the information they’ve collected, fraudsters call the targeted call center, posing as a legitimate customer or employee. They may spoof Caller ID to make the call appear more credible.
  • Social Engineering Fraudsters may manipulate agents using social engineering techniques to extract more information about the victim from call center agents.
  • Exploiting System Vulnerabilities Attackers may exploit technical vulnerabilities in the call center’s automated systems, such as IVRs, to gain access to accounts or sensitive information.
  • Carrying Out Fraudulent Activities Once access is gained, fraudsters may perform unauthorized transactions, change account settings, or extract sensitive data for future use.

Types of Call Center Fraud

Call center fraud comes in many forms:

  • Account Takeover Fraud Fraudsters exploit information and help received from call center agents to gain unauthorized access to customer accounts, often to steal funds or make unauthorized purchases. They may use social engineering techniques to convince agents to reset passwords or bypass authentication protocols.
  • Identity Theft Attackers impersonate individuals to extract sensitive information, such as Social Security numbers or credit card details, for use in other scams. This can result in significant harm to the victim, including financial loss and damage to credit scores.
  • Phishing and Vishing Fraudsters trick agents or automated systems into revealing sensitive information by posing as legitimate entities. Vishing, or voice phishing, specifically targets call centers via phone, often using Caller ID spoofing to appear credible.
  • Social Engineering Attackers manipulate agents into bypassing security measures, such as skipping identity verification steps, to gain unauthorized access to accounts. Social engineering exploits human psychology, preying on an agent’s willingness to help callers and take them at their word.
  • Insider Fraud Employees within the call center misuse their access to sensitive data or systems for personal gain or in collaboration with external fraudsters. This type of fraud is particularly dangerous because insiders already have legitimate access to key systems.
  • IVR Mining Fraudsters exploit the Interactive Voice Response (IVR) system of a call center to validate the information they have and gain additional data.
  • Card Not Present Fraud Fraudsters make purchases via a call center using credit card information stolen from the victim or purchased on the dark web.

The Impact of Call Center Fraud on Businesses

Call center fraud can have significant and devastating consequences for businesses:

  • Financial Losses Unauthorized transactions, stolen funds, and inflated operational costs from fraud can result in substantial financial losses. These costs often extend beyond direct theft, as fraud detection and recovery efforts add to the financial damage.
  • Reputational Damage Customers who are victims of fraud campaigns directed at a company’s call center may lose trust in the business, damaging the company’s reputation and customer loyalty. Negative publicity from fraud incidents can also erode public confidence in the company.
  • Operational Disruption Fraudulent activities put a strain on call center resources, reducing efficiency and increasing workloads for agents. This can impact the overall productivity of the business and affect its ability to serve legitimate customers.
  • Compliance Risks Data breaches or mishandling of customer information due to fraud can lead to regulatory penalties under laws such as HIPAA or GDPR. Businesses may face fines and legal challenges if they fail to protect sensitive information adequately.
  • Customer Attrition Repeated instances of fraud can drive customers away, impacting long-term revenue and growth. Dissatisfied customers may switch to competitors who are perceived to have better security measures.

How to Detect Call Center Fraud

Early detection of fraud is critical to minimizing its impact. Red flags include:

  • Repeated Failed Authentication Attempts Multiple unsuccessful attempts to verify identity may indicate that fraudsters are testing stolen credentials. This pattern suggests a deliberate effort to bypass security and should be investigated immediately.
  • Unusual Account Activity Requests to change account details or transfer funds immediately after a call can signal fraudulent behavior. Unexplained changes in account settings or transactions should trigger alerts for review.
  • High Call Volumes from Specific Numbers or Regions Unusually high traffic from certain sources may indicate toll fraud or coordinated attacks. These patterns often involve spoofed Caller IDs to obscure the fraudster's true origin.
  • Discrepancies in Caller Behavior Callers who avoid security questions or become overly insistent when asked for verification may be attempting to use social engineering to deceive agents.
  • Spoofed Caller IDs Calls that appear to come from trusted numbers but don’t align with expected activity could indicate spoofing.

How to Prevent Call Center Fraud

Preventing call center fraud requires a combination of security technology, employee training, and best practices:

  • Adopt Call Authentication Technology Call authentication helps ensure that calls are coming from trusted sources. Use protocols like STIR/SHAKEN to verify the legitimacy of incoming calls and reduce spoofing risks, and deploy call center authentication technologies to automate the verification process.
  • Monitor Call Activity in Real-Time Use monitoring tools to identify unusual patterns, such as repeated failed logins or suspicious call origins.
  • Implement Multi-Factor Authentication (MFA) Require additional verification steps, such as one-time passwords or biometric authentication, to enhance security.
  • Leverage AI and Behavioral Analytics Deploy AI-powered tools to analyze caller behavior and detect anomalies that may indicate fraud.
  • Train Employees on Fraud Awareness Educate agents about common fraud tactics and teach them how to recognize and respond to suspicious activity.
  • Secure IVR Systems Strengthen IVR systems against vulnerabilities by requiring PINs or other authentication measures.
  • Limit Access to Sensitive Information Restrict agent access to sensitive customer data and enforce strict data handling protocols.
  • Conduct Regular Audits Review call logs and security practices periodically to identify and address potential vulnerabilities.

SecureLogix: Comprehensive Solutions for Voice Networks

SecureLogix provides leading call branding, security, and authentication solutions that reduce costs, maximize revenue, and restore trust. For the past 20 years, we have profiled, tracked, and defended customers against a wide range of threats directed at call centers and voice networks. Our patented technology represents the only unified solution set for the full range of security and trust issues that threaten the enterprise today.

SecureLogix® Call Defense™ System: Complete Protection Against Call Center Fraud

SecureLogix Call Defense™ System delivers industry-leading protection for voice networks and contact centers. Sitting at the edge of your voice network, the Call Defense™ System filters good traffic from bad in real time to reduce unwanted and malicious calls, keeping your voice network safe and secure from call center fraud and other attacks and disruption.

The Call Defense™ System includes a voice firewall, voice intrusion prevention system (IPS), a malicious callers database (Red List), and forensic reporting capabilities. With real-time visibility and control of all voice calls in and out of your contact center and enterprise, you can implement and enforce voice security policies in real time to identify and stop a wide range of call center fraud, including vishing, social engineering, payday loan scams, toll fraud, and 911 center TDoS attacks.

Key Features

  • Enterprise-wide call visibility and unified policy enforcement.
  • Alerting, blocking, and/or redirection of malicious and fraudulent calls.
  • Enforcement of call volume thresholds and traffic velocity limits.
  • Scheduled and ad-hoc reports for voice network usage and attack/fraud forensics.

SecureLogix® Call Secure™ Managed Service

The Call Secure™ managed service delivers the security benefits of the Call Defense™ System administered by an experienced call security service team.

Key Benefits

  • Proactive monitoring of new attacks and malicious calls.
  • Reduction in call spam and unwanted nuisance calls.
  • Enhanced call visibility across the enterprise.

Orchestra One™ Call Authentication Service

The Orchestra One™ call authentication service combats call center fraud by identifying trusted callers before they reach your contact center agents.

Key Benefits

  • Shorter calls with automation to reduce call handling time.
  • Improved customer experiences by eliminating the frustration of security questions.
  • Lower authentication costs through real-time carrier network metadata analysis.

FAQ

Q: What is call center fraud?

Call center fraud refers to criminal activities where attackers exploit call centers to gain unauthorized access to customer accounts, information, or funds through social engineering, phishing, or other tactics. Call center fraud targets the trust-based nature of call centers to deceive agents.

Q: How do fraudsters target call centers?

Fraudsters often use stolen credentials, spoofed caller ID, or manipulation techniques to bypass verification processes and deceive agents or automated systems. They may also exploit technical vulnerabilities in IVR systems.

Q: What are common signs of call center fraud?

Signs include repeated failed authentication attempts, unusual account activity, spoofed caller IDs, and callers who avoid or resist security protocols. High call volumes from specific numbers can also indicate coordinated attacks.

Q: How can businesses prevent call center fraud?

Businesses can use multi-factor authentication, AI-based fraud detection tools, employee training, and call authentication technologies to reduce risks. Proactive measures and regular monitoring are key to prevention.

Q: How does call authentication technology help?

Call authentication technologies and protocols like STIR/SHAKEN verify the legitimacy of incoming calls, reducing the risk of spoofing and impersonation scams.

Additional Reading