The Federal Communications Commission (FCC) is taking action to put a stop to SIM swapping, a form of fraud in which bad actors can take control of peoples’ cellphone accounts by convincing a wireless carrier to transfer the victim’s service from their own phone to one in the possession of the criminal, according to an announcement.
In a second type of scam called port-out fraud, a criminal poses as a victim to open an account with a carrier that is different from the current carrier, arranging it so the victim’s number is “ported out” of the account with the new carrier, the announcement stated.
The FCC said in the announcement that it has received “numerous complaints” from people who have “suffered significant distress, inconvenience and financial harm” from these practices. Its goal is to stop these types of attacks by “proactively addressing the risk of follow-on attacks using stolen data” to cut down on additional fraud from data breaches.
To do so, the FCC wants to amend the rules so carriers have to adopt more secure methods to authenticating customers before redirecting their phone numbers to a new device or carrier, according to the announcement. The organization has proposed making it so providers have to notify customers whenever a SIM change or port request happens on a customer’s account.
Earlier this year, a California man sued T-Mobile for letting an attack happen that led him to lose hundreds of thousands of dollars’ worth of cryptocurrency.
The man said he had lost over $450,000, due to what he said was T-Mobile’s “negligent practices and its repeated failure to adhere” to the law.
Last year, the PYMNTS November Digital Identity Tracker, done in collaboration with Jumio, said “less than half of North American banks employ digital ID verification during onboarding when opening bank accounts, with most requiring customers to verify themselves in person by visiting branch locations with physical ID documents in tow.”
That ended up being an archaic practice because of the pandemic.
See more: Combatting SIM Swaps and Other Swindles With Secure Digital Identity
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