Telecom Fraud Detection & Prevention: The Ultimate Guide (2025)

Telecom fraud is a high-stakes threat, especially if you’re managing international voice communications. Industry forecasts show mobile operator fraud and security losses peaking at $45 billion in 2025, before dropping to $36 billion by 2028 as 5G security measures become standard.

That’s why telecom fraud detection and prevention is mission-critical. Businesses that rely on global calling infrastructure require more than basic fraud flags. They need real-time insights, adaptive algorithms, and proactive systems that can outpace bad actors without interrupting legitimate traffic or the customer experience.

This guide breaks down the types of fraud you need to be on alert for, the risks they pose to your brand and bottom line, and outlines how to build a robust, scalable fraud prevention strategy.

What is telecom fraud?

Telecom fraud refers to any unauthorized use of telecommunications products or services with the intent to steal money, data, or resources. These fraudulent activities typically exploit weaknesses in voice networks, billing systems, or interconnect agreements, often without immediate detection.

How telecom fraud works

Here’s how telecom fraud typically unfolds:

• Infrastructure exploitation: Hackers gain access to business phone systems, such as cloud Private Branch Exchange (PBX) or Voice over Internet Protocol (VoIP) platforms, through weak passwords, outdated firmware, or a lack of authentication protocols.
• Unauthorized call routing: Once inside, they often generate high-cost international calls, reroute traffic through GSM gateways, or use premium-rate numbers to rack up charges in a matter of hours.
• Subscription and account takeover: Cybercriminals use stolen credentials or social engineering to gain control of accounts, manipulate billing details, or commit identity theft.
• Real-time monetization: Once in control, attackers make thousands of phone calls to premium or high-cost destinations and often use automated systems to scale their fraud attacks.

Why telecom fraud matters to businesses

Telecom fraud impacts every layer of business operations. Here’s how:

• Financial losses: A single incident can cost thousands, or even millions, of unauthorized call charges, fraud penalties, and mitigation costs.
• Brand reputation damage: Downtime, disrupted service, or fraud-related disputes erode trust with customers and partners.
• Regulatory exposure: Failing to detect and report fraud can put companies at odds with compliance standards, such as the Payment Card Industry Data Security Standard (PCI-DSS) and General Data Protection Regulation (GDPR).
• Operational disruption: Fraudulent calls flood the phone system, strain routing capacity, and interfere with legitimate customer interactions.

6 types of telecom fraud

Below is a breakdown of the most prevalent types of telecom fraud businesses should recognize:

1. International revenue sharing fraud (IRSF)

In IRSF schemes, attackers partner with international carriers or premium number owners to generate artificial call traffic.

How it works:

• A hacker gains access to your phone system, often via PBX or Session Initiation Protocol (SIP) credentials.
• They use automated systems to flood calls to high-cost international or premium-rate numbers, typically in regions like Somalia, Cuba, or Latvia.
• The hacker then splits the earnings from these calls with the terminating carrier.

Indicators to monitor:

• Spikes in call volume to unfamiliar international destinations
• Calls during off hours (nights, weekends, or holidays)
• A sudden increase in short-duration calls to the same country code

Prevention tip: Set strict call limits to high-risk international destinations and use real-time call analytics to flag sudden call spikes.

2. PBX hacking

PBX hacking involves unauthorized access to a business’s PBX system, typically through voicemail ports or weak admin credentials.

How it works:

• Hackers exploit security flaws in on-premise PBX systems or unsecured VoIP servers.
• Once inside, they route international calls, tap lines, or intercept call data.

Indicators to monitor:

• Unusual call routing behavior
• High outbound traffic from inactive extensions
• Admin panel logins from foreign IP addresses

Prevention tip: Disable unused ports and features on your PBX and run routine system audits.

3. Account takeover

Account takeover fraud targets user credentials, especially admin or billing logins, to gain full access to telecom services.

How it works:

• Cybercriminals use phishing, social engineering, or brute force attacks to gain unauthorized access to user accounts.
• They then change routing settings, issue SIM swaps, or generate fake billing activity.

Indicators to monitor:

• Unauthorized account setting changes
• New or unknown devices accessing the management system
• Unexplained SIM provisioning or porting requests

Prevention tip: Implement multi-factor authentication (MFA), monitor login activity in real-time, and use behavioral analytics.

4. Wangiri fraud

Wangiri is Japanese for “one ring and cut.” This scam tricks recipients into calling back missed numbers that connect to high-cost international lines.

How it works:

• Attackers use automated systems to dial thousands of random numbers.
• Each call disconnects after one ring, prompting recipients to return the call.
• The scheme routes callbacks to premium-rate numbers, generating revenue for the scam operator.

Indicators to monitor:

• Large volumes of short-duration inbound calls
• Repeated missed calls from unfamiliar international numbers
• Customer complaints about call charges after returning unknown calls

Prevention tip: Block known fraudulent caller IDs and use a DenyList to prevent callbacks to premium-rate numbers.

5. Smishing

SMS phishing, or smishing, uses fraudulent text messages to trick users into clicking malicious links or sharing sensitive information.

How it works:

• Attackers send messages impersonating banks, telecom providers, or delivery services.
• They direct users to phishing websites that collect login credentials or payment information.

Indicators to monitor:

• Bulk SMS messages from unauthorized numbers
• Reports of phishing attempts from internal users
• Redirects to unfamiliar domains

Prevention tip: Educate your team with webinars on cybersecurity and deploy SMS filtering to block known phishing patterns.

6. SIM box fraud

The SIM box fraud scheme involves routing international calls through local SIM cards to avoid paying proper interconnect fees.

How it works:

• Cybercriminals deploy GSM gateways loaded with SIM cards from local providers.
• They disguise the calls as local traffic to bypass international toll rates.

Indicators to monitor:

• High volumes of international traffic get rerouted through a local exchange
• Frequent call drops or voice quality issues on inbound international calls
• Repeated use of the same caller ID from different geographic areas

Prevention tip: Monitor abnormal routing patterns and local call surges.

Why is telecom fraud detection important?

Telecom fraud impacts businesses on multiple fronts. Here’s how it can damage operations:

Financial implications

Telecom fraud led to over $38 billion in global industry losses in 2023, according to the Communications Fraud Control Association (CFCA).

Beyond the direct cost of fraudulent calls, businesses also grappled with chargebacks, invoice disputes, and service disruptions that drained profitability.

Customer protection and trust

When scammers exploit your phone system or impersonate your brand in smishing schemes, customers may receive scam calls, phishing messages, or inflated bills.

If your fraud prevention measures fall short, your customers may switch to providers who offer stronger security and protection.

Regulatory compliance and data protection

Telecom fraud often overlaps with identity theft, unauthorized data access, and financial crime. This triggers exposure under the following frameworks:

• PCI-DSS: For handling credit card data in call centers
• GDPR: For protecting EU residents’ personal data in call logs and messaging
• Health Insurance Portability and Accountability Act (HIPAA): For call data containing protected health information
• STIR/SHAKEN: For preventing caller ID spoofing and verifying call authenticity in the US

Regulators increasingly expect proactive fraud detection systems to be in place. Non-compliance can result in fines, legal consequences, and public relations fallout.

Telecom fraud detection solutions

As fraud schemes grow more sophisticated, businesses must move beyond reactive blocking and adopt proactive defense tools.

AVOXI, for instance, integrates these capabilities directly into its global voice platform, combining technology and intelligence to detect, prevent, and respond to telecom fraud in real time.

Here’s how businesses can use AVOXI’s features to combat telecom fraud:

1. Real-time monitoring

Real-time monitoring tracks call traffic and network behavior as it happens and flags anomalies like spikes in call volumes, high-cost destinations, or irregular call patterns.

Why it matters:

Delays in detection mean losses compound quickly. AVOXI’s Call Insights dashboard evaluates inbound and outbound traffic across global routes and identifies irregularities before they escalate into financial threats.

AVOXI features:

• Live call traffic dashboards with customizable alerts
• Geo-based traffic visibility to detect destination-based fraud
• Credit limit thresholds to prevent runaway toll charges
• DenyList tools to block known fraud-prone destinations and numbers

2. AI and machine learning

AI and machine learning algorithms analyze historical and real-time data to understand normal traffic patterns and detect unusual activity. These systems adapt over time, identifying threats more accurately than static rule-based systems.

Why it matters:

Unlike traditional fraud filters, which primarily rely on fixed thresholds, AI-driven systems offer continuous learning, enabling them to adapt to new fraud patterns in real-time. This reduces false positives and catches subtle threats before any damage is done.

AVOXI uses advanced analytics that evolve in response to your traffic patterns, enabling it to distinguish between legitimate surges and malicious activity.

AVOXI features:

• Continuous monitoring of voice traffic using machine learning-based detection algorithms
• Flag anomalies based on real-time and historical trends, minimizing disruption and enhancing fraud prevention accuracy

3. Risk-based authentication and security

Risk-based authentication and security use device intelligence, login location, time of access, and historical patterns to determine if a session poses a risk.

Why it matters:

Some threats stem from compromised internal accounts or unusual authorized user behavior. A rigid, one-size-fits-all security approach often fails to detect these subtle threats. Risk-based authentication enables smarter, more flexible responses without compromising user experience.

This is another area where AVOXI strengthens platform security.

AVOXI features:

• Multi-factor authentication (MFA) for every user login
• SIP encryption to secure voice traffic and block interception attempts
• STIR/SHAKEN compliance to validate caller identity and reduce spoofing

7 best practices for preventing telecom fraud

Use the following best practices to stem the rising tide of telecom fraud attempts:

1. Integrate fraud prevention into your existing systems

Integrating detection systems with your voice platform allows for automated rules, seamless call routing controls, and real-time response mechanisms.

With AVOXI’s global voice coverage, you get built-in tools like DenyList, credit limits, and geo-based call blocking that integrate with your existing VoIP infrastructure.

2. Add in AI-powered analytics

Static rules can’t keep up with modern telecom fraud schemes. Businesses need dynamic, AI-driven fraud detection systems that learn from traffic patterns and flag anomalies before they escalate.

3. Train employees on fraud tactics and prevention

Phishing emails, smishing scams, and accidental exposure of login credentials are a few ways employees can unintentionally create vulnerabilities, making them either your weakest link or your first line of defense.

What to train employees on:

• Identifying suspicious SMS messages or login prompts
• Recognizing social engineering tactics
• Properly securing VoIP access credentials and admin panels

4. Use advanced authentication systems

Strong authentication should go beyond passwords to include multi-layered access verification.

Verify that your platform provides MFA across all admin accounts, encrypts SIP traffic, and leverages role-based access control to minimize insider threats.

5. Comply with regulatory requirements

Telecom fraud prevention is also about compliance with international standards. Depending on your region and industry, this may include GDPR, STIR/SHAKEN, PCI-DSS, or HIPAA.

6. Create an incident response plan

Attackers can target even the most secure systems. A clear, step-by-step fraud response plan can be the difference between a minor disruption and a six-figure loss.

What to include in your plan:

• Internal escalation protocols
• Thresholds for automatic call blocking
• Predefined communications with affected clients or carriers

7. Look for vendors with rapid incident resolutions

Partnering with a provider that offers 24/7 network monitoring, proactive threat alerts, and real-time fraud resolution is critical for global operations.

With its 24/7 global carrier surveillance and dedicated fraud response team, AVOXI provides rapid mitigation when anomalies arise. That means faster incident resolution and minimal impact on business operations.

Secure your communications before telecom fraud strikes with AVOXI

Telecom scammers frequently change tactics—so companies must stay one step ahead by adopting proactive telecom fraud detection and prevention strategies.

AVOXI helps enterprises build that critical first line of defense. From real-time call monitoring and AI-powered fraud analytics to risk-based authentication and 24/7 global support, AVOXI equips your organization with the tools to stop fraudulent activity before it damages operations.

Ready to protect your global voice infrastructure with AVOXI’s advanced fraud prevention tools? Schedule a demo today to see how AVOXI can help you safeguard your communications.