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Keeping your fraud fight strong amid M&A

This article was published in The Communicator (April 2017) issue 108 of the Communications Fraud Control Association Journal.

There’s a saying guaranteeing us only two sure things in life—death and taxes. If you’re in telecom, you know there’s a third certainty—mergers and acquisitions. Every week, the news details the latest telecom deals and speculates on carrier partnerships that haven’t yet happened. Even the smoothest mergers and acquisitions (M&A) involve a transition period, which can be stressful to navigate. And, for those in the fraud trenches, it’s crucial to quickly and efficiently integrate your fraud department/team/systems after M&A to protect both companies from substantial loss and fraud risk. Here are 7 tips for maintaining a strong defense and avoiding pitfalls amid the transition.

Network integration

No two companies have the same business model, serve the same customers, nor offer the same services. Likewise, each party in a M&A already has an established fraud management strategy/system/solution (FMS). Having two distinct processes does NOT make one right and one wrong; however, one size definitely does not fit all when two carriers combine forces. You can’t catch or stop fraud if you’re not monitoring the traffic. Your goal after M&A is to:

• Monitor the CORRECT traffic. Ask about network integration so nothing slips through the cracks.
• Streamline your efforts. Eliminate intermachine traffic to avoid false alarms due to duplicate records.
• Understand ALL traffic types (commercial versus residential customers) and how its routed.
• Determine how record monitoring occurs (SIP records, CDRs, both, or some other method).
• Compare all traffic types to identify and define standards, whenever possible.

Blocking

Whether called blocking, barring, disabling, stopping, you likely take steps to shut down unwanted call activity. Don’t assume current blocking policies apply to the new traffic.

• Determine all blocking policies to stop fraud as quickly as possible and to avoid unwanted outages for legitimate traffic on the network.
• Identify blocking protocols—manual vs. automated, method of connection (direct switch interface, API, etc.) —and communicate to all.

Business/monitoring rules

Every carrier has unique situations and circumstances, which mean different monitoring rules applies (aka business rules, customer profiles, or configurations). A finely-tuned set of monitoring rules for one network is likely not effective at all for another network.

• Evaluate your monitoring rules to ensure effective coverage of ALL traffic and customer types.
• Adjust any necessary configuration settings to account for new network/customers.

Hot numbers

Most every fraud practitioner relies on a list of known high-risk, “bad” numbers (hot list, blacklist, hot numbers, etc.) as a tool in their fraud fighting arsenal. A well-managed hot list helps prevent fraud, lost revenue, and duplicate effort across the entire organization.

• Make sourcing and maintaining this list a collaborative effort.
• Merge all versions of the list.
• Standardize the process and criteria required for adding numbers to the list.
• Set and enforce expiration policies for numbers on the list based on activity last seen.

Billing feed

An important component of fraud management is your billing system information. Many times, though, fraud systems get integrated long before the billing systems do. Don’t overlook the billing system feed, as this data helps you properly identify customers and understand the new traffic you’re monitoring. Additionally, your business/monitoring rules are almost certainly dependent on the billing data. Even if the billing systems remain distinct, you should integrate both billing feeds into your fraud system.

Fraud ownership

Even without M&A, there’s a lot of variance when it comes to who “owns” the fraud department and processes.

• Make sure the departments and roles are clearly defined.
• Establish roles, policies, guidelines, so that you don’t incur losses or miss fraud because everyone thinks someone else has things covered.
• Work together for depth of coverage.


Rates

Accurate, up-to-date rates (termination costs) are essential for detecting high-cost destinations. After M&A, ensure your rates reflect the costs of both companies.





Reach out

CFCA members are very helpful when it comes to fighting fraud, so speak up if you have questions. Many CFCA members have experience with FMS integration after M&A. Your FMS vendor is also a great resource. Ask your FMS provider to recommend the most efficient, cost-effective integration pathway. Rely on their experience navigating this process with other telecom companies to help shorten and streamline your integration timeline. Get the help you need to fortify your defenses, especially during a transition, because fraudsters constantly look for a way in.

About the Authors

Amy Oldham is in Corporate Communications at Equinox Information Systems, where she creates and maintains the company’s technical documentation and all other customer-facing publications. Amy is also responsible for the company’s newsletter, email campaigns, press releases, and social media presence. When not writing, Amy enjoys spending time with her family, playing tennis, attending Dave Matthews Band concerts, and swimming.

Christi Vanoye has visited almost 40 states and multiple countries to install and train our customers. In addition to training for new and existing Protector and TeleLink installations, she also helps customers ensure that Protector is fully configured and provides fraud monitoring consultation based on her years of experiences and interactions with nearly 100 different fraud management implementations. For TeleLink installations, Christi also is responsible for all billing mediation design. Christi is married to her college sweetheart, and they have one son who is in college. Though she now lives in downtown Chicago, she grew up in a small town in Louisiana and loves the outdoors (SCUBA diving, hiking, gardening). She graduated from Texas A&M University and worked at the University of Texas Medical Branch (UTMB) for 11 years before joining Equinox. Christi loves that each day at Equinox brings a new project, a new place to visit, a new group to train, a new problem to solve.

To learn more about Equinox, its products, and staff, visit www.equinoxis.com or call (615) 612-1200.