It is called sim box fraud. Mostly run by foreigners and made possible by insane tax on telecommunications.
Let us pick an hypothetical call from the USA to Kenya.
International call to Kenya = $0.70 (sh70) per min
International call to Costa Rica = $0.05 (sh 5) per min
Local call within Kenya = $0.05 (sh 5) per min
How sim fraud works:
1. A person in the USA buys legitimate 3rd party calling bundles online.
2. To call Kenya, person in the USA calls a US local number for free, enters authorization code bought online, then enters destination number.
3. The call is routed into a Voice Over IP system using internet. An internet connected GSM gateway picks the call.
4. The GSM gateway then dials the local number that the person in the US intended to call.
5. The call appears to be originating locally.
This system has effectively evaded the old-school telephone termination protocol and denied GoK the exorbitant termination tarrifs it charges. The legitimate copany USA and the illegal Chinese operators in Kenya share the difference in call cost (sh70 - sh5 = sh65). The loss to GoK is sh65 for each call that goes through a sim box. Of course the customer in the USA gains too by being given a calling deal that is much cheaper than direct calls.
Our empty-skull government officials insist on high taxation without realizing that high taxes create black markets where gov loses much more than it makes.
The people buying the simcards are foot soldiers for organized crime rings from China, Russia, and Eastern Europe. Kenya can kill this illegal industry overnight and make billions of shillings from direct calls.
Topic: Interesting SiM Box Fraud (Read 493 times)