Mobile operators and banks are increasingly looking to technology to help strengthen the RICA process in order to combat growing fraud. For example, the number of cases of fraudulent SIM swaps grew by some 900 percent between 2011 and 2014.
“Upgrades, SIM swaps and new contracts are all flashpoints for the perpetration of fraud, and the mobile industry is under increased pressure as a result,” says Nick Perkins, Divisional Director at Bytes Systems Integration. “We’re seeing increased interest from mobile operators in how to use technology-based solutions to make RICA more effective when enrolling new clients, or extending and amending contracts.”
Perkins says that fraudulent identity documents are being used to open new contracts in order to acquire expensive smartphones, which are then sold to criminal syndicates. The mobile operators thus lose the value of the smartphone, which can run into thousands of rands. While no statistics for this type of fraud exist at present, he says that anecdotal evidence suggests it is fairly significant and on the increase. Nigeria recently introduced compulsory SIM card registration in a bid to contain SIM card fraud—a clear indication of the industry’s focus on this issue.
SIM swaps are often used for more elaborate phishing schemes with the aim of diverting SMS transaction confirmations from banks away from the accountholder’s phone. As a result, the mobile operators and banks are beginning to cooperate in order to combat SIM swap fraud.
“One of the keys to closing down these types of fraud is positive identification of the account holder or applicant, and thus we are starting to see the mobile operators showing interest in accessing the Home Affairs database to match fingerprints to identity numbers,” says Perkins. “Fingerprint readers obviously have a role to play here, but Bytes is of the opinion that the technology needs to be part of a streamlined enrolment process. That way companies can enhance the experience for legitimate customers, and be sure of identifying fraud before it is perpetrated.”
Perkins says that as part of the process of optimising enrolment, Bytes helps clients create a paperless process. This reduces the need for physical storage of paper, and means that customer records can be easily searched across the company’s network.
“Technology that’s properly embedded in an integrated, robust business process can use biometrics effectively to stop fraud in its tracks, making RICA truly more effective,” Perkins concludes. “That way, everybody wins—except the fraudsters, of course.”