Telecom SIM Subscription Frauds: Global Policy Trends, Risk Assessments and Recommendations

Effective identity verification solutions are the key to tackling telecommunication Subscriber Identity Module (SIM) card subscription frauds. Subscription fraud involves obtaining customer KYC details needed for signing up for new SIM cards or services with valid authorization but using the SIM cards for fraudulent activities. The effects of the damage done can be catastrophic in terms of financial fraud, poor customer experience, and damage to the brand. Telecom Service Providers (TSPs) face a massive challenge in this regard; they must overcome fraud while staying compliant with Department of Telecommunication (DOT) regulations. Most telecom service providers are currently using standard techniques for customer identity validation and verification, which are ineffective in detecting and controlling subscription fraud.

In this project, the researchers have: (i) Assessed the risks in the current customer identity verification process, (ii) Analysed the SIM registration policies in 160 countries, iii) Proposed multi-channel online identification validation methods, including knowledge-based validation, phone authentication, address validation, and one-time password use. The recommendations proposed are based on a multi-layered risk-based approach that leverages intelligent analytics, predictive decision policies and knowledge-based authentication to enable real-time identity verification and regulatory compliance. The recommendations and report of the project outcome are submitted to Telangana Police.

The project was undertaken under the MOU with Telangana State Police Center of Excellence for Cyber Security.