From: an407769@anon.penet.fi (jerry the golden retriever)
Date: Sat, 21 Oct 95 15:08:46 PDT
To: cypherpunks@toad.com
Subject: big bust
Message-ID: <9510212202.AA27572@anon.penet.fi>
MIME-Version: 1.0
Content-Type: text/plain


Feds Bust Huge Cell Phone "Cloning" Ring
NEW YORK, NEW YORK, U.S.A., 1995 OCT 20 (NB) -- New York officials have
cracked what they call "the biggest illegal cellular telephone cloning
operation in the country" with the arrest of three individuals this week. If
convicted the suspects could receive up to 15 years in state prison.

"Cloning" is the process of retrieving the electronic serial numbers (ESNs)
of legitimate phones off the airwaves and programming the purloined numbers
into stolen phones. Thieves capture the numbers using special scanners placed
near busy highways and airports. ESNs can also be obtained from stolen
phones.

Denver-based Secret Service agent Bill Bresnahan told Newsbytes the Secret
Service is tasked with investigating cellular phone fraud, Bresnahan says
investigative techniques include monitoring cell activity for an unusually
high number of long distance calls, and the use of direction finding
equipment to track down the illicit phones while they are in operation.

US West spokesperson Wendy Carver-Herbert and Bresnahan say there are some
steps that cell phone users can employ to help foil phone theft or catch
thieves. They encourage cell phone users to step up the physical security
they provide their phones. "If you are going to leave your car with a parking
attendant or parked on the street for several days, remove the handset and
the antenna to avoid drawing attention," says Carver-Herbert. She also
recommends activating the electronic lock when you are away from the phone.

They also recommend monitoring your cell phone bill closely. If you see calls
you are sure you didn't place, contact your service provider immediately, and
if your phone is stolen the company can block calls from that number. US West
Cellular has programmed its computers to watch for anomalies in each
customer's calling pattern as another way to foil this high tech crime, and
the company employs security personnel to contact customers when calls fall
outside the normal pattern.

The New York raid seized cloning software, 46 cell phones and various
equipment including computers officials said contained legitimate cell phone
access numbers which when programmed into cloned phones allows the purchaser
to illegally use cellular service without paying. They often make expensive
long distance calls to other parts of the world.

Officials said as many as 27,000 phones have been cloned over the last seven
months and at least 3,000 usable legitimate access numbers were stored in the
computers seized in the raid. Authorities estimate losses from the latest
scam may have cost phone companies as much as $27 million. Cell phone service
providers lose an estimated $1.5 million a day nationwide because of phone
cloning. Authorities said it costs a thief about $50 to get a stolen cell
phone activated with a cloned number. The phone can then be sold on the
street for about $100.

The Manhattan District Attorney, Robert Morgenthau, was particularly
interested in this case. He said his own phone has been cloned twice by
thieves recently. The first time the bill exceeded $3,000 and the second time
more than $5,000 in calls were charged to his number. The legitimate holder
of the cell phone number that is cloned isn't aware the phone has been cloned
until the bill arrives.

In an attempt to stop losses cell service provider Bell Atlantic NYNEX Mobile
(NYSE: NYN) recently introduced the use of personal identification numbers,
which the company said has cut phone fraud by an estimated 80 percent. The
user punches in the unique PIN and presses the send button on the phone after
dialing the desired number. Authorities say the cellular phone industry
spends $5 million annually to stop sophisticated cellular phone fraud.

(Jim Mallory/19951020/Press contact: Kim Ancin, 914-365-7573, or Jim Gerace,
914-365-7712, both of NYNEX)
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