SIM box fraud blamed on 19 cent/min international call charge

Minister of Communications, Haruna Iddrisu has accused the telecom operators of not being committed to the fight against SIM Box fraud, but highly placed sources within the telecom industry have disagreed with the minister saying government's own policies are responsible for the fraud.

The Minister during the launch of the Ghana Chamber of Telecommunications (GCT), said that telecom operators have not been supportive of government monitoring the international gateway for the purposes of checking fraud and secure government tax revenue from there.

But the experts noted that governments own fixed rate of 19 cents per minute of inbound international call is the main attraction for SIM box fraudsters.

Haruna Iddrisu claimed that recently a telecom operator participated in the arrest of a British SIM Box fraud and the fraudster was sent to court, but 21 days into the court proceedings, the telecom operator opted out of the case.

The most recent SIM box bust involving a 64-year-old British citizen, Mike Andrew Hayward, was with the collaboration of Vodafone Ghana, but checks by Adom News indicate Vodafone is still pursuing that case however the fraudster has been granted bail.

The Minister noted that through international gateway monitoring, government had been able to prevent huge revenue losses in taxes, saying that this year alone the ministry had paid some $53 million into the consolidated fund as revenue from inbound international calls.

He said in spite of that the telecom operators continued to be critical of the gateway monitoring, which is intended to ensure transparency in the industry and stem fraud.

In the early days of the debate about the need for international gateway monitoring, the minister was reported as saying government suspected telecom operators were not being transparent with records on inbound international calls.

Government therefore employed the services of the Haitian-based Global Voices Group (GVG) to do international gateway monitoring on behalf of government to ensure transparency, check fraud and secure tax revenues.

GVG reportedly proposed to government to fix the inbound international call rate at 19 cents per minute, out of which government charged a levy of six cents per minute upfront for the state, before the telecom operators pay taxes and make other payments from the remaining 13 cents.

The telecoms experts argued that the 19 cents fixed rate, proposed by GVG, was rather an attraction to the SIM box fraudsters because they were able to offer traffic careers cheaper rates to terminate calls in Ghana for them.

The experts noted that a greater chunk of international calls to Ghana came from Ghanaians living or schooling abroad who used call cards, and those call cards operators and dealers were the ones who solicited the services of SIM box fraudsters because they found the 19 cents per minute rather high.

“Most of the people who make calls from overseas to Ghana are Ghanaians and they buy the call cards because the dealers promise to charge less than 19 cents per minute and most of those calls are routed through SIM boxes and terminated as local calls in Ghana,” one of the experts said.

He explained that in Nigeria for instance, the cost of terminating international calls and domestic calls is the same so SIM box fraudsters are virtually non-existent in that country because that business would not be profitable, but in Ghana there is huge money to be made even if the fraudsters terminate the call for between 10 and 15 cents per minute.

Another of the experts said GVG proposed the 19 cents to justify why government would need its (GVG's) equipment to monitor the international gateway, adding “that was a smart move, wasn't it, because GVG gets to share the six cents with government.”

Meanwhile, Vodafone, for instance had always insisted they did not need GVG's equipment to monitor their gateway for fraud, and they had proved that on their own, and in collaboration with the regulator, they could bust SIM box fraudsters without GVG.

Some of the operators, who allowed the GVG equipment to be fixed on their premises, have expressed uncertainty about how those equipment are helping to stem SIM box fraud because the international calls which bypass the telecom operators and terminate as local calls, also bypass GVG.

“Government claims the primary reason for international gateway monitoring was to check SIM box fraud but whatever bypasses us, bypasses GVG so really I will be happy to know how GVG can help us stop SIM box fraud,” one official of a telecom operator said.

“We are using other vendors who are delivering better services for less so I am not too sure if bringing in GVG was the smartest thing to do,” he said.

The official however pointed out that GVG's role has been important to government because GVG is a neutral body and government trusts their records on international inbound calls more than what individual telecom operators may submit, and that ensured some transparency and security for government tax revenue.

“But it would be important to know exactly how much GVG is making from this deal because their services were withdrawn from some African countries before they came to Ghana,” he said.

Story by Samuel Nii Narku Dowuona/Adom News/Ghana