Telecommunication fraud can take many forms, and interconnect bypass is one of the most straightforward ones. But this fact does not mean it is easy to combat. Any destination with a higher-than-average mobile termination rate or strict international traffic regulations is a target that is almost inevitably hit with interconnect bypass fraud over and over again.
In a typical scenario, illegally obtained SIMs of a local operator are installed in a device known as a “GSM gateway" or “SIM box", hence the name - SIM box fraud. The fraudsters then use this device to route international calls to the targeted network as if they were local calls generated by its own customers. The fraudsters benefit from the difference between the international termination rate, charged to the upstream carrier, and the cost of the local call, which can be very close to zero if they are lucky with the retail plan on the SIMs. And these benefits comprise the very significant $2.7 billion loss for the telecom operators annually (according to the 2019 Fraud Loss Survey by the CFCA).
However, the direct losses from SIM box fraud are not the only problem. A call routed through a SIM box will most often have very low quality. So there is also the factor of customer dissatisfaction – for both the originating and terminating side. Besides, seeing a national number on the display of the mobile phone only to realize that this is actually an international call is also highly misleading.