revenue assurance

Punctured Profits & Fraud Management.Punctured Profits & Fraud Management.

Revenue Assurance – Revenue Assurance – Punctured profits & Fraud ManagementPunctured profits & Fraud Management

Presentation by Anil KumarPresentation by Anil Kumar


What impacts profits?What impacts profits?

Shrinking of the Top Line – loss of revenuesShrinking of the Top Line – loss of revenues

Increase in Cost lines Increase in Cost lines

Impact = A Hole in the company’s profitsImpact = A Hole in the company’s profits


Examples…..Examples…..

Enron, Worldcom and many moreEnron, Worldcom and many more

Impact…… collapse of organisationsImpact…… collapse of organisations

Also collapse of Audit & Consulting firmAlso collapse of Audit & Consulting firm

Impact = A Big Hole in the company’s profitsImpact = A Big Hole in the company’s profits

Investors losing their money, people rendered Investors losing their money, people rendered

joblessjobless


Cycle of Telecom ServicesCycle of Telecom Services

Develop and price products

ManageNetwork

Infrastructure

Manage receivables and fraud

Rate and Bill

Provide service

Manage customer &

carrier relations

Sell products

Market products

Account and report


Revenue Leakage PossibilitiesRevenue Leakage Possibilities

Developing and pricing of ProductsDeveloping and pricing of Products

• Launch of products without adequate testing in a Launch of products without adequate testing in a hurry to launch first e.g VAS.hurry to launch first e.g VAS.

• Launch products without technology support to Launch products without technology support to ensure there is no revenue leakage. ensure there is no revenue leakage.

• Tariff changes at short notice to counter Tariff changes at short notice to counter competition.competition.


Revenue Risk OpportunitiesRevenue Risk Opportunities

Selling of ProductsSelling of Products

• Sales without adequate verification of customers.Sales without adequate verification of customers.• Re entry of fraudulent customers.Re entry of fraudulent customers.• Fictitious activations/sales to earn more Fictitious activations/sales to earn more

commissions.commissions.• Provision of services without corresponding Provision of services without corresponding

checks and balances to prevent high exposures.checks and balances to prevent high exposures.



Network infrastructureNetwork infrastructure

• Inadequate capacity deployment of sites at Inadequate capacity deployment of sites at high contribution areas like roaming.high contribution areas like roaming.

• Inaccurate usage capturing.Inaccurate usage capturing.

• Inadequate control over switch databasesInadequate control over switch databases

• Inadequate controls over provisioningInadequate controls over provisioning

• Fraudulent usage of test SIMS/phonesFraudulent usage of test SIMS/phones


Fraud OpportunitiesFraud Opportunities

Manage Carrier RelationsManage Carrier Relations

• Roaming fraudsRoaming frauds

• Carrier contracts and billingCarrier contracts and billing



Service ProvisioningService Provisioning

• Launch of new products/Value added servicesLaunch of new products/Value added services

• Inadequate controls over SIMS and recharge Inadequate controls over SIMS and recharge coupon pins.coupon pins.

• Recharging frauds.Recharging frauds.



Rating and BillingRating and Billing

• Inaccurate configuration of tariff tables.Inaccurate configuration of tariff tables.• Inadequate Controls over Bill plan changesInadequate Controls over Bill plan changes• Weak Controls over free airtime connectionsWeak Controls over free airtime connections• Inadequate Controls over rating of CDRsInadequate Controls over rating of CDRs• Weak Controls over bill generationWeak Controls over bill generation• Controls over customer files/balancesControls over customer files/balances• International Long distance grey calling.International Long distance grey calling.


Collection Fraud possibilitiesCollection Fraud possibilities

Manage ReceivablesManage Receivables

• Credit limit fixationCredit limit fixation• Non-adherence to credit policyNon-adherence to credit policy• Non monitoring of high usageNon monitoring of high usage• Cash management through Collection agenciesCash management through Collection agencies• Payments through credit cardsPayments through credit cards• Non allocation of cases to collection agencies.Non allocation of cases to collection agencies.• Non Barring of services to defaulting customers.Non Barring of services to defaulting customers.


Revenue Reporting RisksRevenue Reporting Risks

Account & ReportAccount & Report

• Improper subscriber nos. reportingImproper subscriber nos. reporting

• Inflating revenue figuresInflating revenue figures

• Under-reporting of bad debts Under-reporting of bad debts


Risks to CostlinesRisks to Costlines• Payments for leased lines not in use.Payments for leased lines not in use.

• Deployment of network elements with inadequate utilization.Deployment of network elements with inadequate utilization.

• Inadequate controls over energy costs.Inadequate controls over energy costs.

• Inadequate verification of Interconnect charges payable to Inadequate verification of Interconnect charges payable to

other operators.other operators.

• Overcharging by content providers and call center agencies.Overcharging by content providers and call center agencies.



Account & ReportAccount & Report

• Improper subscriber nos. reportingImproper subscriber nos. reporting

• Inflating revenue figuresInflating revenue figures

• Under-reporting of bad debts Under-reporting of bad debts


Fraud illustrationsFraud illustrations

• Non rating of “Zero Non rating of “Zero Duration Calls”Duration Calls”

• Non configuration of certain Non configuration of certain destinations in the IN destinations in the IN platformplatform

• Subscribers not billed for Subscribers not billed for considerable period of timeconsiderable period of time

• Free airtime given to Free airtime given to distributors/subscribers distributors/subscribers without adequate authoritywithout adequate authority

• Unauthorised bill plan Unauthorised bill plan changeschanges

• Configuration checksConfiguration checks

• Rejected call analysis.Rejected call analysis.

• Reconciliation of active Reconciliation of active customers vs. billedcustomers vs. billed

• Regular review of FAT Regular review of FAT connections.connections.

• Control log for bill plan Control log for bill plan changeschanges

Area of RiskArea of Risk Prevention techniquesPrevention techniques


Fraud illustrationsFraud illustrations

• Activating roaming with call Activating roaming with call conferencing facility without conferencing facility without proper credit verificationproper credit verification

• Leakage of information Leakage of information regarding prepaid customer regarding prepaid customer database to the competitorsdatabase to the competitors

1.1. Keeping activation of VAS as Keeping activation of VAS as centralised.centralised.

2.2. No VAS activation without No VAS activation without credit verification.credit verification.

1.1. Stringent IT controls over Stringent IT controls over data copying, mailing & data copying, mailing & printingprinting

2.2. Confidentiality clause with Confidentiality clause with outsourced agenciesoutsourced agencies

Area of RiskArea of Risk Prevention TechniquesPrevention Techniques


Fraud illustrations – NLD/ILDFraud illustrations – NLD/ILD

• High termination charges in High termination charges in the case of Sex lines paid by the case of Sex lines paid by the ILD operators for traffic the ILD operators for traffic on international lines. e.g. on international lines. e.g. Deigo Garcia.Deigo Garcia.

• Call routingCall routing

• Specific clauses in the Specific clauses in the agreement.agreement.

• Regular monitoring of high Regular monitoring of high traffic to few numbers.traffic to few numbers.

• Review of Least call routes Review of Least call routes and data analysis of call and data analysis of call carrying.carrying.

Area of RiskArea of Risk Prevention TechniquesPrevention Techniques


How frequently are the IT security compliance results How frequently are the IT security compliance results measured by your organisation?measured by your organisation?

Source: KPMG India Fraud Survey Report 2006Source: KPMG India Fraud Survey Report 2006


How was it detected?How was it detected?



In which of these areas did the majority of Rupee losses In which of these areas did the majority of Rupee losses occur?occur?



What is the medium available to employees to report What is the medium available to employees to report wrongdoing in the organisation?wrongdoing in the organisation?



QUESTIONS ?QUESTIONS ?


THANK YOUTHANK YOU

revenue assurance

Business

improper subscriber

inflating

revenue risk

fraud opportunities

fraud illustrations

bill plan

collection

bad debts