The GSMA wants operators to adopt a new standard to stamp out roaming fraud, writes Eugene Bergen Henegouwen.
Roaming fraud is making headlines today more than ever before and is gaining the serious attention of mobile operators around the world. The new focus on this growing problem is not only due to increased roaming traffic because of dropping roaming charges, especially in Europe. The real problem is that fraudsters have become increasingly more sophisticated in their drive to wrest profitability from operators.
Roaming fraud has gained such a level of prominence that the GSM Association (GSMA) has launched an initiative designed to see it off for good. This new initiative – Near Real Time Roaming Data Exchange (NRTRDE) – has been developed especially to combat International Revenue Share Fraud (IRSF), an organized and criminal activity that exploits the current roaming system and takes advantages of its inherent weaknesses.
The GSMA has called on its 700+ global mobile operators members to adopt the NRTRDE standard before October 2008. Once adopted, the new standard will replace the current High Usage Report (HUR) and significantly reduce the time it takes operators to exchange roaming call records. In fact, NRTRDE promises to lessen the incidence of roaming fraud by up to 90 percent, safeguarding revenue for operators and ensuring secure roaming for their subscribers.
A multi-million problem
According to a GSMA survey of 37 operators some months ago, significant roaming fraud losses affect networks of all sizes and in all regions. In one instance, a single operator is reported to have suffered losses of €11.1 million in just under two years, a sign that IRSF has grown from a niche problem to a very serious one quite rapidly, becoming a costly concern for the world over.
Martina Kurth, Principal Research Analyst, Gartner Group, recently acknowledged that "roaming fraud is a very real and present danger for operators the world over, and it is impacting their bottom lines." She said any initiative that enables operators to minimise roaming fraud is a strategic business issue upon which operators must act if there is not to be further erosion into their profitability.
Today's networks were originally equipped to prevent roaming fraud losses via the HUR, which would alert operators about possible instances of fraud. HUR requires the transfer of a call data record (CDR) detailing roaming usage between the visited (roaming) and home operator networks within a 36-hour window. Unfortunately, fraudsters have found a way to exploit the rather lengthy amount of time it takes for the CDR to arrive, often making it too late to prevent the fraud. As a result, the defrauded revenue is lost for good.
The GSMA NRTRDE initiative replaces the HUR standard with a new one that will keep operators ahead of the growing sophistication employed by the fraudsters. With NRTRDE, the visited network is required to forward CDRs to the customer's home operator within four hours of the call end time. If the visited operator is unable to get this information to the home operator in time, the visited operator is held liable for any fraud associated with those calls, and so there is a greater degree of motivation for all parties to make the measure successful. Once the home operator has received the CDR in such a timely manner, it can use a fraud management system to detect fraud committed by subscribers roaming on other networks.
The record format for exchanging these near real-time records has been defined by the GSMA's Transferred Account Data Interchange Group (TADIG) group with the NRTRDE Interworking Group (NRTIG) responsible for overseeing NRTRDE interworking procedures between vendors and inter-vendor testing.
As well as closing the roaming fraud window currently open on operator networks that use HUR and reducing the incidence of roaming fraud by up to 90%, NRTDRE offers the mobile industry a number of additional benefits. The new standard, for example, gives operators a far more accurate and timely view of how their networks are performing against fraud. Financially, operator profitability will be increased by reducing the potential lost revenue. Just as importantly, NRTRDE offers a secure environment to subscribers and confidence to operators that their networks are combating fraud more effectively than with HUR.
Early compliance means early protection
The GSMA is urging operators to adopt compliant solutions today rather than waiting until October 2008, the date at which GSMA members are required to implement the new standard.
To help operators meet the GSMA deadline for NRTRDE, vendors are working to develop fraud fighting platforms that ensure NRTRDE compliance, and have been proactively taking part in GSMA trials to make certain solutions have the interoperability needed in a global industry. This trial work ensures operators can begin rolling out solutions ahead of the deadline.s
The clock is now running on what is the most important anti-fraud measure for operators in years. With roaming rates expected to decrease even more, the potential increase in roaming activity from a larger number of subscribers means that now is the time for operators to take offensive action by quickly implementing NRTRDE. Without a doubt, NRTRDE is the most effective way available to keep ahead of the fraudsters and combat the potential loss of billions in roaming revenue around the globe.
Eugene Bergen Henegouwen is Executive Vice President, EMEA, Syniverse Technologies
Roaming vendors respond to GSMA initiative
Starhome has announced the launch of ICE – its NRTRDE (Near Real-Time Roaming Data Exchange) compliant service designed to provide continuous and instantaneous safeguards against roaming fraud. ICE fulfils the basic layer of Starhome's complete fraud protection suite, which includes its Roaming Anti-Fraud (RAF) product for real-time fraud prevention.
ICE (Instant CDR Exchange) is the result of a partnership between Starhome and Optel. The partnership combines Starhome's knowledge of in mobile telephony networks and signalling Optel's skills gained from processing more than one billion CDRs daily.âÂÂ?¨âÂÂ?¨
"The cost of roaming fraud is rising," explains Eran Gilad, VP Business Development at Starhome. "It makes up 25% of total revenue leakage, and accounted for almost $60 billion in lost revenue to mobile networks in 2006. However, the measures which track and manage fraudulent activity on their users' networks cannot help operators when fraudulent subscribers are abroad. The GSMA has realised that the HUR (High Usage Report) method, where transmission of the HUR CDR to the home network from the visited network can take up to 36 hours is not adequate. Delays in fraud detection, even for a single incident, can be very costly and the home network is liable for the cost of any fraudulently made calls." âÂÂ?¨
ICE replaces HURs and works by managing, controlling and delivering roaming data on a near real-time basis, eliminating the risk of delays. ICE routes roamer CDRs from the visited network to the home operator's fraud management, revenue assurance and subscriber spending limit systems, giving mobile networks the required data and reliability to reduce roaming fraud.
Syniverse has developed DataNet, its NRTRDE compliant platform. Like Starhome and Optel's ICE, DataNet sends roaming partners' CDRs to their respective home networks. After receiving roaming CDRs from roaming partners, DataNet sorts them, translates them to the fraud management system format specified by the operator and routes them back in near real-time. DataNet also provides reports foroperators that wish to continue receiving HUR reports in full compliance with GSMA PRD FF.04: High Usage Report Format and Contents. With usage based on NRTRDE data, Syniverse says these reports represent an evolution of HUR reporting because the use of NRTRDE data enables operators to limit their financial risk much more rapidly.