SABAHE@macalstr.edu (Arun Baheti) (03/14/91)
[Moderator's Note: Mr. Baheti passed along this article which I am
presenting as part of the two part series on cellular fraud. The last
issue of the Digest (#200) presented a story by Joe Abernathy. PAT]
{New York Newsday}, March 7, 1991, By Joshua Quittner
The US Secret Service said one of its agents cracked the code
of counterfeit computer chips to block a kind of cellular telephone
fraud responsible for an estimated $100 million a year in unbillable
long-distance calls.
During the past two months, the service has quietly
distributed a free software "patch" that blocks unauthorized
long-distance calls at cellular telephone switches. The patch is
being heralded in New York City, where more phone service is stolen
than anywhere else in the country. The first day the patch was put
into use in Los Angeles, more than 5,000 illegal cellular calls were
blocked, a Secret Service spokesman said yesterday.
[...] The counterfeit chip used by phone cheats exploits a
weakness in the cellular telephone system that allows a caller's first
call to be completed before the billing status is verified ... A
legitimate mobile phone has a silicon chip that generates an
identification number. When a call is made, that number is relayed to
the carrier, along with the caller's phone number, and the two numbers
are compared to establish billing.
However "depending on where you're roaming and how busy the
cellular network across the country is, you can make a phone call
before that procedure is completed." [Norman Black, Cellular Telephone
Industry Association] To exploit that weakness, underground engineers
designed a counterfeit chip that generates a different, phoney
identification number on each call, tricking [the cellular telephone
exchange] into thinking each call is the first.
One illegally rigged phone, confiscated by police in New York
City last year, was turned over to the Secret Service, which
investigates, among other things, telecommunications fraud. Like a
hacker -- a phone computer cheat -- the agent broke into the chip,
read the microcode, decoded the algorithm at its core, then wrote a
program that would help carriers detect its peculiar pattern.
Dave Boll, who heads the Secret Service's Fraud Division in
Washington, said that cellular telephones equipped with the
counterfeit chips "sell for as much as $5,000 each". And he estimated
that such phones are used to make $100 million in unbillable calls
each year.
[The article goes on, to talk about the call-stealing problem
being the worst in NYC and how the unbillable calls tied up the
network for the paying customers].