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The Guardian: New mobile phone scam promises
prizes but could cost a small fortune - 18th February 2004
http://www.guardian.co.uk/uk_news/story/0,,1150241,00.html
Watchdog acts after Guardian investigation exposes calls con
Audrey Gillan Wednesday February 18, 2004
Mobile phone users are facing the biggest spam nuisance to date as
computers bombard thousands of phones with a new scam called
"missed call marketing", the Guardian can reveal. Companies
operating the scheme are facing a crackdown by the government regulator,
the Independent Committee for the Supervision of Telephone Information
Services (ICSTIS), which said missed call marketing was, in its view,
"completely illegal". It has now suspended the numbers
operated by one company and launched an investigation after the Guardian
passed on details of the ruse.
Experts predict that the con could surpass the cost and inconvenience
caused by conventional spam text messages, which have doubled to 2bn in
two years, but which have now become too widely known by the public
after a previous crackdown by the regulator.
The latest scheme promises a cash prize of �1,000 which rarely
materialises but costs each unwitting victim about �15 in premium rate
phone bills
It uses computer-generated calls to ring target phones just once so
that a number is left behind as a missed call. When users ring the
number to find out who has been calling them, they are answered by
someone saying "customer care" then the voice goes into the
"congratulations" spiel. The caller is then referred to a
premium rate number where they can find out more details of their
"fantastic prize". At no time are they voluntarily told how
much this will cost them but a call to the number given to the Guardian
lasted 11 minutes at a cost of �1.50 a minute.
Last year, the Advertising Standards Authority ruled that telephone
companies must seek the permission of the phone user before bombarding
them with marketing material. Under a European commission directive
brought into force last year, unsolicited marketing material can only be
sent electronically if the receiver has previously notified their
consent.
One of the companies we spoke to claimed that they were using numbers
of people who had opted in but our investigations suggested that in the
majority of cases no consent had been given.
In spite of the regulations, such illegal marketing continues to
spiral. Within the last six months, ICSTIS has received more than 7,000
complaints about spam text messages alone. It has cracked down on dozens
of companies, fining them thousands of pounds for infringements.
Many of the scams are being perpetrated by one company, registered in
Tortola in the Virgin Islands.
ICSTIS spokesman Rob Dwight said: "We suspect that it is just
one or two companies behind all this. It cannot be coincidence that
these companies are offering identical services, promoted in a unique
way. Someone, somewhere must be coordinating it all."
One outfit, called Prize Line Promotions and offering an
"amazing cash prize of �1,000 or a �2,000 equivalent in
prizes", appears to be connected to BPQ, which had been responsible
for bombarding thousands of British mobile phones with spam text
messages offering similar prizes. Regulators believe both are related to
another operation called Quartel 3 and that all can be linked back to
Greenbay Ltd, registered in Tortola. All have the same postal and email
address. An ICSTIS investigation has discovered that these companies get
their numbers from Intelliplus, a network which supplies premium phone
lines.
Several of the companies fined for the abuse of premium phone lines
were found to be using numbers supplied by Intelliplus. In July last
year, company chairman Mike Neville said Intelliplus had doubled its
turnover.
It is not suggested Intelliplus is party to the premium line prize
cons. However, ICSTIS said Intelliplus had not been cooperating fully
with its inquiries. Mr Dwight said: "It's fair to say that we still
have a number of outstanding requests with them. They must have the
names and bank account details for these people in order for the revenue
to go to them."
But in a statement, the company said it had complied fully with the
regulators and that it took its legal obligations seriously. It has now
terminated its service with Prize Line.
There are multiple numbers connected to Prize Line Promotions and its
associated outfits. All of them appear to lead to an address at Finchley
Road in north-west London. The Guardian discovered that the address is a
mail box that is visited twice a week by a man who picks up hundreds of
stamped addressed envelopes sent by people who have been sucked in by
the scam. All of them expect a cash prize of �1,000 but in most, if not
all, cases, all they receive is an envelope from a marketing company
containing some discount vouchers, according to some of the victims.
The UK consumer complaints website, Grumbletext.co.uk is inundated
with complaints from people duped by the scams. The majority of them
sent their SAE to the Finchley Road address. One writes: "The
cheeky bastards have given my SAE to another "promotions"
company and today I received - no, don't hold your breath, no prize
money - a brochure of discount vouchers from another company."
Challenged over the methods used, Ricardo Dyson, a manager at the
Prize Line Promotions call centre, claimed that what the company was
doing was a "brand new and legal way of marketing".
But ICSTIS said: "It's completely illegal in our view,
inappropriate, unsolicited and unethical and we will take action against
it".
Mr Dyson claimed that every return caller won a prize. Asked where he
had obtained a Guardian mobile number, he claimed the owner had opted in
and agreed for the number to be used. But one of the other call centre
workers said the numbers had been "bought from the networks".
The majority of call centre staff, all with South African accents,
said they were based in Cheshire but refused to say where. One, at the
same number, said the centre was in Basingstoke.
After the Guardian reported its experience, ICSTIS invoked its
emergency procedure, suspending the numbers we provided and demanded
that Intelliplus withhold any revenue generated on those numbers. They
must now cooperate with the investigation. Mail Boxes Etc is reviewing
the situation with regard to the box marked Suite 155.
How they get our numbers
Buy them List brokers buy and sell lists of mobile phone numbers.
Also, some unscrupulous vendors of mobile ringtones, games, and logos
are suspected of selling lists of valid mobile numbers since the threat
of detection and penalty is low.
Tease them out of consumers When a caller phones a scam premium rate
line they are often required to punch in their mobile number and also
someone else's. Many put in a real number, either because they do not
suspect the promotion is a sham or because they have spent time on a
premium rate line, and do not want to risk things going wrong.
Generate them randomly In many cases the scam outfit will use
computers which send out text messages and make calls in their tens and
hundreds of thousands to sequentially generated numbers which are random
suffixes to any known mobile number stem.
Numbers to look out for: anything beginning 0871 costs 10p per
minute, however any 090 numbers are likely to cost �1.50 a minute.
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