When the P in Pre-Paid means Punked

“Congratulation’s! Pres.GMA’CHRTY FOUND.Ur Sim#have WON! W=680,000 Thousand DisDay 10/04/05,DTI PRMT#.0010 > 4 more info? Call now! Sec.LARRY C.AGUIRRE.” texted sender with phone number +639216727858 on 4 November 2005. Tempting as it may be, a lot of questions come into mind, and they212 start with the spelling of “Congratulation’s!,” the grammar of “have WON!”, the inconsistency of “DisDay 10/04/05” and the actual date 4 November 2005, and the vagueness and implausibility of “DTI PRMT#.0010.” Then the questions continue to “Is it not a wastage of corporate assets if a charitable foundation would give out money to a certain person without any qualification, except that the latter is a SIM (Subscriber’s Identification Module) holder?” or “Why would a non-mobile company give money to a bloke just for having a SIM number?” and “What political advantage can this text message give to ‘Pres. GMA?’ or this ‘Sec. Larry C. Aguirre”? It is either a con artist one-peso investment, or a political destabilizer’s one-peso contribution. A pinch of cynicism exist to scrutinize the text message because of an earlier message was received by my wife allegedly from “SMART PADALA.” The text message, received 22 March 2005, reads “SMART PADALA: U won a nokia 7610 from our network. To claim your prize please call toll free no. 09282292317. DTI NCR permit #2838 series of 2005. God bless.” Three aspects of the message proved problematic, i.e. Smart Padala involves Overseas Filipino Workers (OFW) remittances from abroad to the Philippines through mobile accounts and my wife is not an OFW, but a senior law student as I am, to avail of the Smart Padala service; another was the toll free no. 09282292317, which is a mobile phone number which is never toll free; and lastly, if Smart Communications would actually be giving away prizes of sorts, it would have sent it through the usual three-digit or four-digit numbers, where it sends account notifications and text spams/marketing offers. A call to a brother-in-law, who is an officer in Smart Communications, readily exposed the scam.

Going back to the November text message involving the alleged GMA Charity Foundation, the text has been circulating even prior to November 2005. In August 2005, a certain person from Antipolo, Rizal even called up the texter’s number, and later posted a comment at the government’s dot-gov-dot-ph website. The comment reads:

“I would just want to inquire about the text message that my brother got. It says that I won in a raffle by the GMA CHARITY FOUNDATION. What is this all about? Is this really true? Coz the amoutnt hey mentioned is quite big. We called up the number and we were told that they got the number from my service provide which is GLOBE. We called a certain ATTY. LARRY AGUIRRE and were told to call another person which is ATTY. MANUEL NANDING and he gave the address where we can go to give documents about us. #169 salcedo village, makati city. i just want to know if this is a valid promo coz they have a dti number (dti no. 00110). if not i want to let the government and the others aware of this illegal operation. thank you and god bless!” [ 1 ]

The scam is similar to the scam reported by the Philippine Star on 16 June 2005. DFA Undersecretary for Migrant Workers’ Affairs Jose S. Brillantes said therein that the text messages name drop Bangko Sentral ng Pilipinas (BSP) Governor Rafael Buenaventura, and claim that the receiver has won two million Philippine pesos and has to remit 800 US dollars to be able to receive the prize money. The text message reads “Congrats your cell roaming no. had won P2 million during the electronic raffle drawn from the Central Bank of The Philippines. Call now Governor Rafael Buenaventura at this number: +639156907234,” according to Donnie Fetalino, Attaché and Communications Officer of the Philippine Embassy in Cairo. [ 2 ] Recently, the Department of Foreign Affairs (DFA) warned OFWs against a new text scam circulating in Canada. The Philippine Consulate General in Vancouver reported, resulting from the inquiry of two Filipinos as the veracity of the text message, that the text message reads: “This is an exclusive for OCWs and OFWs. Your roaming number was very lucky to receive $40,000 from CBP. This is a new project of GMA and Western Union.” The Consulate General contacted Western Union to verify the authenticity of the message and the bank informed the mission that there was no such promotion or project. [ 3 ] Simply, the would-be victim receives a text message announcing he has won in a raffle sponsored by BSP (or Pagcor or the Philippine Charity Sweepstakes Office) with prizes ranging from one million pesos to two million pesos. If the victim responds and calls a telephone number given by the sender, an alleged Governor Buenaventura will reply. The victim will be instructed to first pay a ten-percent withholding tax before he can claim his prize. [ 4 ]

Calling the mobile numbers involved after a certain period of time would solicit network notification that “The number you have dialed is either unattended or out of the coverage area. Please try your call later.” Such fact is quite predictable as that the mobile numbers used in the scam would be using pre-paid SIMs. In the November text message, for example, the sender used a +63921 number; i.e. 63 is the Philippines’ country code, 921 involves Smart Buddy subscribers – a pre-paid class of mobile phone subscribers. For a measly sum of less than four United States Dollars (US$4) – the cost of the prepaid SIM being one hundred ninety (P190) pesos only – and the anonymity that is maintained in purchasing the pre-paid SIM, to perpetuate fraud in this manner would, for some, be lucrative.

The scam works in the same manner as how an “advance fee fraud” works. [ 5 ] It is the SMS-based equivalent of the Nigerian money transfer fraud, Nigerian scam or 419 scam, however it may be called. Herein, the con artist would send out text messages similar to those above. If any recipient would express his interest by texting back and/or inquiring into the details of the promotion, the sender would cause the recipient to produce certain amounts of money – usually 10% of the total amount – for the sender to facilitate the release of the prize money or goods. One way of sending the amounts is through bank deposit or transfers. This method of payment, however, is risky to the con artist inasmuch as certain documents need to be presented by the con artist-bank account holder to the bank. Still, one victim was reported to have fallen to such scam. The victim, who comes from the province, said he was duped into depositing twenty thousand pesos (P20,000), as tax for prize money, to a certain bank account number. [ 6 ]

The recipient could also cause the transfer of money by sending the PIN of pre-paid cards, as to credit loads, to the sender’s mobile phone. In a case reported by the Inquirer,

“Victims are told to send the PIN codes of newly-purchased cellphone cards to join a raffle and get a chance to win 1.5 million pesos to 2.5 million pesos. A victim who complained to BSP admitted that he bought 3,000 pesos worth of pre-paid cards hoping it would increase his chances of winning. Needless to say, unsuspecting victims who divulged their PIN codes were not aware that the very same pre-paid cards were being used by the scam artists to send text messages to other would-be preys.” [ 7 ]

Further, the sender can extend his fraudulent scheme by claiming only eight out of the ten PINs actually sent, for example, were ever received by him, or that two or three of the PINs sent do not work and that the recipient should substitute those PINs for him to actually facilitate the release of the prize. No amount of pre-paid credit loads or bank deposits would bring the sender to facilitate the release of the prize, as there is no actual prize existing. The con artist can dispose of his pre-paid SIM if it is apparent that no one else of potential victims would be interested in falling for the scam, or if he/she sensed that law enforcers, if ever, would be on his trail.

Although the scam may be reported to the Anti-Money Laundering Council, the Philippine National Police, the National Bureau of investigation and the National Telecommunications Commission for their appropriate investigation and action, the capture of the fraudster would prove to be difficult as there are no records to determine the person behind the pre-paid number used in the scam. Unlike in post-paid accounts, personal or company ID cards, proof of billing, and other documents are necessary to establish capacity to pay pre-existing obligations. These documents form part of the records of a post-paid account. Although at least 200 million text or SMS messages are sent every day in the Philippines, – more than two for every Filipino and earns the country its reputation as the world’s SMS capital – Filipinos still do not have to give their identities when buying pre-paid phone cards. [ 8 ] No document is required in purchasing pre-paid SIM. It can be bought off the shelf. There is no limitation from buying three SIMs from the three major mobile carriers in the Philippines, i.e. in alphabetical order, Globe, Smart, and Sun, even if the person purchasing has only one set of mobile phone. “The main attraction of pre-paid is that these are low-income countries and subscribers want to control their spending,” said Karen Ang, a Bangkok-based telecoms analyst for Citigroup. “But being able to buy a pre-paid card without giving up a lot of information about yourself is also an attraction.” [ 9 ]

Text-based fraud can be reduced if regulation, not ban, of pre-paid SIM purchase is enforced. In other parts of the Asia-Pacific region, where similar incidents have occurred, governments have set up stringent requirements as to their registration. Last year, Taiwan, fed up with con-men using the cover of anonymity to separate gullible people from their money with scams ranging from simple credit-card tricks to bogus kidnappings, sought to identify pre-paid phone users. Thailand moved to register users of pre-paid phones in May, describing it as part of efforts to stop terrorists using mobile phones to set off bombs. Malaysia ordered phone companies to register all holders of pre-paid services after text-messaging gossip-mongers hit a raw nerve with false talk that the premier’s ailing wife had died. Shanghai, China’s richest city with 20 million people, required registration of pre-paid users last September to tackle text-message fraud. [ 10 ] Most recently, and effective 1 November 2005, Singapore has required new and existing prepaid card users to register their numbers. [ 11 ]

Fraud through mobile phone text has been reported in the Philippines since 2003; and in light of the possibilities of text messaging in sowing wild rumors, perpetrating crime and possibly, triggering bombs; it is a big question why the Philippine government has not pursued any action towards the registration of pre-paid numbers. Unlike prior measure to regulate text messaging in itself – such as to regulation of content, and matters of taxation – that were subject to stiff opposition by consumers, a regulation of pre-paid numbers – not with the Government, but with the respective mobile phone service providers – has not been made, even if there is compulsive proof of the need to regulate such.

The Philippines chronically lags behind its neighbors, and the matters involving consumer convenience and fraud prevention are not exempted from said statement. The Department of Trade Industry (DTI) permit numbers do not serve as a deterrent against consumer fraud as no one is aware of the official list of permits actually issued by the DTI as to promotions. There is no repository, like in the Internet, to check whether a promotion being floated to the public is what it purports itself to be, or if State-sanctioned. The Government should provide for the prevention of fraud, not just to prosecute it when the fraudster make the mistake of making himself identifiable.

Further, the Philippines boasts of its resolve to root out terrorism, but it has not, as apparent as it has been identified by its neighboring countries, there is no regulation that would reduce the mobility of malefactors / terrorists through the use of communication tools, or prevent malefactors from using communication devices as triggers for indiscriminate attacks against the civilian population. Its gestures towards anti-terrorism are confined in grand strokes towards a defective national legislation, intentionally oblivious to simple suppletory solutions such as that of registering pre-paid numbers.

Until the simple regulation would occur, the “P” in pre-paid would more likely lean towards the possibility of being punked.

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Endnotes

1. Gov.ph Home - Forum. www.gov.ph, the Official Government Portal of the Republic of the Philippines. Retrieved 4 November 2005. http://www.gov.ph/forum/thread.asp?rootID=68812&catID=5

2. DFA warns Filipinos Abroad of Text Scam using Central Bank. 16 June 2005. Philippine Headline News Online. Retrieved 30 October 2005. http://www.newsflash.org/2004/02/be/be003139.htm

3. DFA warns OFWs on text scam in Canada. ABS-CBN News. Retrieved 30 November 2005. http://www.abs-cbnnews.com/storypage.aspx?StoryId=22858

4. Giron, Marietta Velasco. “Beware of text scams and their variants.” 9 July 2003. The Consumer, Inquirer News Service. Retrieved 4 November 2005. http://www.inq7.net/lif/2003/jul/10/lif32-1.htm

5. See Dot.Con article, Philippine IT Law Journal, Vol. 3, No. 1.

6. Giron, Marietta Velasco. “Beware of text scams and their variants.” Ibid.

7. Ibid.

8. “Asia wants SMS genie back in its bottle.” 5 September 2005. Sydney Morning Herald. Retrieved 30 October 2005. http://www.smh.com.au/news/World/Asia-wants-SMS-genie-back-in-its-bottle...

9. Ibid.

10. Ibid.

11. Singapore to register pre-paid SIM cards. Philippine Star. 23 October 2005, pp. 1, 4.