Hacked Business Owner Stuck With $52k Phone Bill

ubercam writes "A Canadian business man is on the hook for a $52,000 phone bill after someone hacked into his voice mail system and found a way to dial out. The hacker racked up the charges with calls to Bulgaria. The business owner noticed an odd message coming up on his call display (Feature 36), and alerted his provider, Manitoba Telecom Services. They referred him to their fraud department, who discovered the breach. MTS said that they would reverse the charges if the hacked equipment was theirs, but in this case it was customer owned. The ironic part is that the victim's company, HUB Computer Solutions, is in the business of computer and network security. They even offer to sell, configure and secure Cisco VoIP systems. Looks as though they even couldn't manage to secure their own system, which doesn't bode well for their customers." This certainly isn't the first time someone has exploited the phone system and stuck another with the bill. Maybe it's time for the phone company to get their fraud detection and prevention services at least on par with the credit card companies'.

Comments

WTF?

[fuzzyfuzzyfungus]

Seriously there guys, why would Mr. HUB Computer Solutions let something as embarrassing as that hit the press?

"Oh hi, I got my PBX hacked (possibly because of my 4 character PIN "security") and lost 50 grand on calls to Bulgarian criminals, how about paying me to set up your computers?"

Re:WTF?

[Spazztastic]

Seriously there guys, why would Mr. HUB Computer Solutions let something as embarrassing as that hit the press?

Perhaps he's now offering super-low-discount services and this is just an elaborate advertising campaign?

Re:WTF?

[Warll]

So what you're saying is that his pan is somehting like this:
1. Get hacked
2. Tell the press
3. ?????
4. Profit!

Re:WTF?

[Anonymous Coward]

** Caution: Low-flying Wooshes **

This is an alert of the emergency joke-casting system. Sarcasm detectors in your area have detected low-flying wooshes. This alert is in effect for the entirety of this thread.

Repeat.

This is an alert of the emergency joke-casting system. Sarcasm detectors in your area have detected low-flying wooshes. This alert is in effect for the entirety of this thread.

Re:WTF?

[oldspewey]

I thought the Streisand effect was when somebody doesn't want information to become public, and by acting to suppress it they generate publicity.

Re:WTF?

[mewsenews]

Some context from a native of Winnipeg:

MTS is our AT&T, it's the big bad phone company. I believe it's the second largest company in our province, behind the power company. HUB is a tiny business that I had never heard of. This is very much a David vs. Goliath thing, the HUB guy wants MTS to go easy on the bill because they have money. MTS has dropped all responsibility because it's not their equipment that was hacked, but this guy has come back with "you should have notified me earlier of abnormal usage on my phone lines".

The HUB guy will have to lay off one of his staff unless MTS goes easy on this bill. His only method of leverage on MTS is to speak to the newspaper. That's the reason he's risking public embarrassment.

Re:WTF?

[jlarocco]

I think your jumping to conclusions - the article doesn't give enough information to say whether it should be embarrassing or not. Clearly if he setup the system himself using Asterisk or something, and setting up PBX systems is a service he sells, it's pretty embarrassing. The article doesn't say that, though.

He could have bought the PBX system from a third party, and had them set it up. But the article doesn't say he did that, either. In that case he should probably sue that company for not securing their product.

All the article says is that he wasn't renting the equipment from the phone company.

Re:WTF?

[poot_rootbeer]

this guy has come back with "you should have notified me earlier of abnormal usage on my phone lines".

The customer equipment that got compromised was a goddamn PBX. He should have been watching it himself for signs of abnormal usage.

Re:WTF?

[Registered Coward v2]

this guy has come back with "you should have notified me earlier of abnormal usage on my phone lines".

The customer equipment that got compromised was a goddamn PBX. He should have been watching it himself for signs of abnormal usage.

I agree fully with that statement. I worked for a small company (400 people) and our telecom folks watched the usage patterns like a hawk, and stopped several hack attempts cold. The only one I know of that they didn't stop was one where a calling card number was shoulder surfed; and they kept getting either no answer or VM at the phone company's fraud desk. The phone company ate that bill.

ScuttleMonkey doesn't even read TFS

[mugnyte]

Maybe it's time for the phone company to get their fraud detection and prevention services at least on par with what the credit card companies have done.

    Dude, it wasn't the phone company's equipment - hence the "outrageous" charge to the consumer.

Re:ScuttleMonkey doesn't even read TFS

[morgan_greywolf]

ScuttleMonkey probably just hasn't figured out that, as far as the telcos are concerned, everything on the INSIDE of the drop is the customer's problem, everything on the OUTSIDE of the drop is the phone company's problem, unless the customer has specifically hired the phone company to handle the customer premises equipment. And more and more phone companies aren't doing that anymore.

Re:ScuttleMonkey doesn't even read TFS

[spazdor]

Credit card companies do things like monitoring your usage habits, and calling you when you deviate wildly from them in order to make sure everything is legit and froody.

This is a useful and profitable thing for them to be doing, since when things turn out not to be legit and froody, the credco is sometimes on the hook themselves for a lot of money.

It is not as useful or profitable for a telco to do the same, because they charge money for a "service" that it costs them next to nothing to render. If the customer accidentally runs up a huge bill, then the dilemma is different: if they don't get to collect on that bill, they haven't lost out on anything but a bit of network traffic.

Re:ScuttleMonkey doesn't even read TFS

[michaelwv]

"It is not as useful or profitable for a telco to do the same, because " they are not legally on the hook. Thanks to some consumer-friendly legislation passed a while back, the credit card companies are specifically liable for fraudulent transactions above a $50 limit. The phone companies are not. Figuring out whether or not the marginal cost to the phone company was comparable to $52k (they're probably paying some other company to call Bulgaria) is complicated. But I'll agree that it's likely much less, whereas the marginal cost to the CC company is the numeric amount. But really I think the liability protection has made the biggest difference in how attentive CC companies are to these things. Other practices aside, this is something that most CC companies do very well in striking a balance between usability and minimizing fraud.

Re:ScuttleMonkey doesn't even read TFS

[Richard_at_work]

if they don't get to collect on that bill, they haven't lost out on anything but a bit of network traffic.

This is a myth - when the phone company does not originate and terminate the call themselves, they get charged by the companies they pass the call on to to have it terminated. In many situations, the large phone companies agree to call it quits as they carry roughly the same amount of each others calls, but in international call markets, these agreements are much rarer.

So yes, potentially (in reality, quite likely in this case) there is a real cost to the phone company if they do not collect on the bill.

Bulgaria?

[onehitwonder]

Shouldn't the telecom provider be able to identify the phone number(s) in Bulgaria that the hacker called? If a hacker is calling Bulgaria, I'd think there's probably some international crime or identity theft ring centered there that the phone company and government officials would want to know about. Either that, or the hacker was calling about the whereabouts of his mail-order bride.

Re:Bulgaria?

[OhPlz]

Often times, the thief sells calls at clusters of payphones in low income urban areas. The calls are made to wherever the immigrants in the area came from. These rings have phone systems like this that they hijacked, stolen prepaid phone card lists, stolen credit card lists that they can use to place calls, and so on. This is where a lot of phishing leads to. If they think anyone is on to them, they can just walk away. The authorities rarely get involved because they're too difficult to catch and the dollar amounts aren't large enough. It's a great scam because it's easy and they don't have to risk taking delivery of anything. The minutes turn into cash.

Re:Bulgaria?

[OhPlz]

$50k is a lot to you or me, but sadly it's not enough to interest the authorities. I've been there. We knew the street corners in various cities where these guys operated, times of day, we could even detect when they were active. Occasionally the FBI would take our info but we never heard that anything ever came of it.

I can understand it. Nothing tangible was stolen. The business is in one location, the crime can be geographically far away. Why does NYC care about some small company in some town they've never heard of? Even if they caught the guys, it's going to be a difficult case to prove. You'd have to catch them with their lists or catch them selling to an informant. Even then, could you tie them to other thefts on different days? I don't know.

Are they going to be able to recover anything? Probably not. I'd bet these guys are working for someone else. The best you can do is lock them up, and the someone else will simply hire someone else.

Finally, the losers in these cases are somewhat to blame. The company in this story didn't secure their phone system. They didn't monitor it either. It's one thing to ask why the telco wasn't watching for fraud, but why wasn't this company either? Why didn't their switch throw up a red flag?

In cases I've dealt with, we sold prepaid minutes online. It was too easy. Enter a credit card and we give you a PIN. Hello fraud opportunity. Doesn't surprise me at all that they didn't want to help find people taking advantage of our poorly thought out business plan. We did get rather good at detecting these situations real time though, both at time of sale and at time of use. They were clever, it was almost like reading the "Cukoo's Egg". They'd find a way around almost every roadblock we put up, eventually.

Why would they do that?

[GrenDel Fuego]

This certainly isn't the first time someone has exploited the phone system and stuck another with the bill. Maybe it's time for the phone company to get their fraud detection and prevention services at least on par with what the credit card companies have done.

As long as the customers are responsible for the charges, they have no business reason to invest in fraud protection.

Bruce Schenier refers to this as an externality, and had written about it a number of times in the context of credit card security and computer security.

http://www.schneier.com/blog/archives/2007/01/information_sec_1.html

http://www.schneier.com/blog/archives/2006/03/credit_card_com.html

http://www.schneier.com/blog/archives/2005/10/preventing_iden.html

Not astonishingly suprising...

[damn_registrars]

I don't find this suprising in perspective of what people in the service sector usually have for themselves.

After all, what kind of car does your mechanic drive? Do you know when your mechanic last did an oil change on their own car?

Hint - the mechanic's car is usually fixed last, if ever.

In similar light I knew a cardiologist a few years back who died of heart failure.

It isn't easy to find time to maintain for yourself the same kind of equipment that you are paid to keep up for others.

Re:Not astonishingly suprising...

[jellomizer]

Or the old quote.
The Carpenters house is always the one that is in least repair.

Re:Not astonishingly suprising...

[Spazztastic]

Or the old quote. The Carpenters house is always the one that is in least repair.

Good point, their site runs Sharepoint and the Site Settings prompt is open to the world.

http://www.hub.ca/default.aspx

Re:Not astonishingly suprising...

[the jalapeno]

Or the old quote. The Carpenters house is always the one that is in least repair.

Or the town barber is always the one with the worst haircut..

Re:Not astonishingly suprising...

[222]

I manage a Cisco CallManager cluster (now called Unified Communication Manager, but whatever) and the problem here is that this is such a trivial mistake. We have every device / extension that doesn't require outside access in an internal only calling search space, and this includes our Unity voicemail ports.

I can't stress this enough; whoever was responsible for setting up this system seems to have ignored every best practice guide for deploying CallManager. I'd actually like to see their setup, just for curiosities sake. I'd also have to recommend against using their consulting services :- )

But as for the other stuff you said, I sort of agree. My network at home is an absolute cabling / design mess.

Re:Not astonishingly suprising...

[he-sk]

Great work! Not only is he stuck with a 50k phone bill, but now his internet bill will skyrocket as well thanks to the slashdotting of his site.

Are you his competitor by any chance?

Re:Not astonishingly suprising...

[Anonymous Coward]

[citation needed]

Will this do?

Re:Not astonishingly suprising...

[Raistlin77]

This does not really have the same meaning as the others because giving yourself a haircut is more difficult than giving another person a haircut.

So is open heart surgery...

Re:Not astonishingly suprising...

[ralf1]

The Carpenter's house is the one with the really skinny dead chick in it.

1-900...

[curtix7]

I hear bulgaria has the best phone sex lines confirm/deny?

Re:1-900...

[Servo]

Only one way to find out!

Re:1-900...

[gandhi_2]

I just spent 2 weeks in Bulgaria with the Utah Army National Guard.

Let me assure you, none of us had ever seen so many gorgeous women in one place.

Re:1-900...

[LandDolphin]

Of course, you came from Utah.

Good luck with MTS. Seriously.

[Abstrackt]

I had a phone cable dug up recently because MTS didn't mark it on a cable locate. The responses ranged from "sorry, you're out of luck" to "where else are you going to go for phone service?" I feel bad for the guy, but unless he takes it to court he isn't getting any help from MTS.

bewildering...

[Dzimas]

It is strange that MTS doesn't monitor extreme spikes in phone use. They claim that they don't have the resources to monitor anomalies, but it should be relatively straightforward to write a report that queries billing totals that are n times a customer's long term average. After all, few companies would see a legitimate spike of 20 or 30x normal billing from month to month. What it boils down to is that MTS doesn't want to be responsible for identifying fraudulent billing (lest the victim use that as grounds to get the charges waived), and the easiest way to avoid legal responsibility is to bury their heads in the sand.

Re:bewildering...

[snspdaarf]

Agreed. When our receptionist got hacked, and was doing call transfers to "9", AT&T picked up on the outbound calls as unusual and called us. They shut down the calls and canceled the charges. We own our switch, and there was none of this silly dance that MTS is doing.

Some Math

[Anonymous Coward]

Let's assume these calls cost $3.00 for a minute.

$56,000 / 3.00 = 18667 Minutes.

18667 / 60 (min/hr) = 311 Hrs.

So that means nobody noticed as this guy called for almost 2 full weeks of talk-time??

($3.00 is an assumption as I have no idea what actual international rates are)

Still, if this is even in the ball-park, that's a hell of a lot of talk time going unnoticed. You'd think the system would flag if you suddenly doubled your usage over a period of time.

Re:Some Math

[LackThereof]

Well, there's three reasons I can see.

This company probably didn't have an international calling plan of any sort, so they were stuck paying whatever obscene rate the local phone company charges for international calls, a la carte.

Also, the phreakers probably had multiple lines in action at any given time, so it wouldn't have taken too terribly long to rack up a large number of minutes.

Lastly, HUB probably didn't notice that anything was going on, until they got the paper bill in the postal mail. With a monthly billing cycle, plus an extra two or three weeks to receive the bill after the end of the cycle (and then a few weeks past that for the accounts payable clerk to bring it to the attention of the owner), I can imagine that this slipped by unnoticed for a long time.

Ha ha

[DeadManCoding]

Sorry, but no sympathy for this guy. It's his company's equipment which was hacked. His telecom company isn't responsible for his equipment, and if they're nice, they'll alert him to the calls. They make money when those calls are made, and why should they be responsible for alerting a customer who's making phone calls. Yes, the calls are going to Bulgaria, but that doesn't mean a telco should alert every person when they make a phone call overseas.

Re:Ha ha

[Creepy Crawler]

In most civilized countries, possession of stolen property is a criminal offense, as is selling said property. Service is also seen as the same.

How is it not fraudulent behaviour to collect on services that amounted from theft?

Have Teleco Block Outgoing International Calls?

[Zymergy]

Is there not a way to just block the ability to direct dial International Calls at the Phone company level. That way a calling card could be used to only dial international?
If the phone company does not offer such a protection, they are in a manner condoning such abuse are they not?

I was also under the impression that YOU had to be the one that actually 'in good faith' placed the calls for it to legally billed to you. I am not sure about US/Canadian telecom laws?

If a stranger hacks my WIFI encryption in my neighborhood and downloads child prOn, warez, illegal MP3, etc.. through my router/IP that DOES NOT mean that I did it and I AM NOT responsible for those communications/transfers as I have made reasonable accommodations to prevent that (plus I shutter to think that any of my neighbors are into any of that).
I would simply be responsible for getting a better protected router or some other commonplace and reasonable standard process of WiFi protection.

Similarly, this firm likely had made reasonable efforts to NOT have their phone system hacked, and therefore did not make the calls and thus should not be made responsible for them. The phone company should protect their customers 'in good faith'.

Re:Have Teleco Block Outgoing International Calls?

[GrenDel Fuego]

If a stranger hacks my WIFI encryption in my neighborhood and downloads child prOn, warez, illegal MP3, etc.. through my router/IP that DOES NOT mean that I did it and I AM NOT responsible for those communications/transfers as I have made reasonable accommodations to prevent that (plus I shutter to think that any of my neighbors are into any of that).

There's a difference between criminal liability and financial. You wouldn't be convicted of downloading child porn (or shouldn't be at least), but if your internet access was pay as you go, you may still be required to pay for the bandwidth used.

Re:Have Teleco Block Outgoing International Calls?

[Anonymous Coward]

The phone company should protect their customers 'in good faith'.

I know what all those phrases mean. I just never imagined I'd see them all together in one sentence like that.

Why ask MTS for compensation?

[e9th]

He should be looking to the company that installed the system for compensation, not MTS.

If the phone company wants to charge...

[gandhi_2]

...then they should be legally liable for selling stolen goods.

The phone bill is exactly stolen services....and for the phone company to sell that should be illegal.

Yay for 4-digit pins

[MobyDisk]

Davison has a four-digit password on the voice mail. That doesn't stop professional hackers, said Brett Rhodes, an expert in the field who runs SME Teleresources Inc. in Winnipeg.

I once saw a web site with a list of all 4-digit pins on it. I mean like, every single one!!!! There must be... hundreds.. no... thousands of possiblities! Keeping or distributing such a list should be illegal.

Re:Yay for 4-digit pins

[Anonymous Coward]

Incorrect PIN number. You have 9998 tries remaining.

I am in the same business

[E. Edward Grey]

...and there is no, I mean, NO excuse for what this guy allowed to happen, from the perspective of a telephony engineer.

Point #1: how weak is your security that an external entity can log in and gain access?

Point #2: why in the world does his voice mail system have a class of service that allows outdialing? Typically a telephony engineer restricts the class of service on the ports connecting to the phone system so that they can only pass calls to the phone system itself, not to the outside world.

This guy is unbelievably lazy, and the fact that he wants someone else to pay for his mistakes is insane. He fails at life.

When can we start executing hackers?

[tjstork]

Everyone here seems to have this blame the victim for getting hacked, but, why should we have to do this security stuff at all? Why can't we just execute the criminals. Everything is all about put up shields, pay tons of money for security, and its as if the criminals have more of a right to our systems than we do. Enough already. This guy shouldn't have to pay any money at all, regardless of whether he had the shields up, or not. People ought to be able to have a relative sense of security about themselves, and if we have to behead 50,000 convicted hackers and identity thieves and hang their bloated corpses off of bridges as an example to others, then, lets get on with it.

Death to hackers, that's the best security policy that any country could have.

hmmmm

[dissolved]

I work for a Telco. We flag to clients when they accrue silly spends to foreign numbers. This happens around the $100 mark generally. Why did this go unnoticed for so long? Incidentally this is completely the responsbility of the end client. Anyone could ring Bulgaria for hours on end and then blame "teh criminalz!!!11". Secure your equipment better.

Or.....

[Weaselmancer]

That's not because Bulgaria rocks - it's because you're from Utah.

Re:The phone company?

[Ironica]

Why should the phone company be responsible for their customer's incompetence?

If they installed it... maybe... but they didn't.

Why are credit card companies responsible for their customers' incompetence? If I leave my credit card on a bench at the mall, and call to report it lost within a reasonable amount of time, I'm not liable for most of the charges. That's a legal limitation, too... not just customer service. The credit card company didn't leave my card lying around, or make it easier to lose in some way, but they still have to eat the charges.

Several years ago, our electric bill jumped suddenly. Our deadbeat tweaker roommate decided to run the AC 24/7 "Like they do in Hawaii." The (municipal) power department computers automatically detected the change in usage, flagged it, stopped our bill from being issued, and sent it to CS to contact us and find out if there was a physical problem. (Then something got dropped so they didn't contact us, and didn't send a bill... four months later they came knocking on our door, all apologies.)

So, yeah, I think it's reasonable for a utility company to auto-flag aberrant usage. Though true, the guy *should* have configured his phone system correctly too...

Just Great.....

[IHC Navistar]

Now some politician is going to start making us enter CAPTCHAs every time we want to make a call..... To protect us.....