26 October 2006

Detica, the business and technology consultancy that specialises in Information Intelligence, is urging the UK's leading mobile operators to develop more sophisticated ways of identifying the criminal networks that are costing the UK telecoms sector close to £1bn* a year in fraudulent activity.

Alistair Lovegrove, telecoms specialist at Detica, explains: "New techniques are needed that can readily identify networks of fraudsters operating below the threshold of current systems. If operators are to address the significant losses that they are experiencing due to organised subscription fraud, they need to introduce techniques such as social network analysis that will enable them to flag potential new fraudsters much earlier."

Social network analysis is the mapping and measurement of relationships between people, groups and organisations. Its techniques can be used to map the normally invisible relationships between people to identify and understand networks of collaborating individuals or organisations across disparate and unlinked sources of data. By pooling data from multiple sources about people and their transactions, it is possible to link groups of people into networks of activity. Social network analysis therefore has the potential to provide investigators with a new way of quickly and reliably identifying fraudulent activity.

Lovegrove continues: "Most frauds using false identities have an associated physical footprint, such as a name, delivery address, or bank account which leaves a trail that social network analysis can identify and subsequently analyse. For instance, when signing up for a new mobile phone contract, the fraudster needs to supply names, home addresses and bank account details to pass the standard credit checks. Since a valid bank account is needed, fraudsters need to set up and manage a portfolio of apparently legitimate accounts to support their activities. The sheer scale of such frauds makes managing an individual account for each false identity uneconomical, leading gangs to share half a dozen accounts between their false identities."

Lovegrove explains: "Social network analysis would identify subscriptions using the same bank accounts and would flag these networks as suspicious. If customers in the network are already associated with bad debt or are known fraudsters then investigators will know to watch any new account joining the network carefully."

Social network analysis can supplement the tools that investigators currently use to investigate and connect networks of fraudsters. By identifying these connections, it allows entire fraud rings, as opposed to individual fraudsters, to be detected and shut down.

Lovegrove concludes: "Fraudulent activity is costing UK telecoms companies close to £1bn* per year and has a major impact on service levels and customer confidence. Mobile operators in particular need to heed these warnings and develop more sophisticated ways of identifying fraudulent activity to limit their losses."

Sally Clift or Rachel Ringstead Porter NovelliTel: +44 (0)207 853 2222email: or