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By Joel D. Pinaroc, Subeditor
“CONGRATULATIONS! D’LST 7DIGITS of ur sim#
had WON ELECTRONIC JACKPOT PRIZE fr, PAGCOR PHIL & CENTRAL
BANK DTI #2588 2005 call KATE MuñOZ #09168880466.”
This is but one of the text, or simple messaging
service (SMS), scams circulating among the 30 million mobile-phone
users in the country.
The One-Stop Public Assistance Office (OSPAC), a
subagency of the National Telecommunications Commission (NTC),
reports that victims of these bogus messages are not necessarily
indigent folk, but include doctors, lawyers and other professionals.
Danilo Cuenca, OSPAC chief, said one documented
case involves a lawyer who was duped into buying 12 prepaid cards in
300-peso denomination and dumping these into one number being used
by the scammer.
“If the scam involves cash, the scammer often
asks for prepaid cards.
If it involves prizes in kind, say a car,
victims are often instructed to open an account or deposit certain
sums to an ATM account to be able to ‘claim’ the prize,”
Cuenca said. He cited another case involving a private employee who
deposited P15,000 to claim “prizes” supposedly won from an
electronic raffle.
Unfortunately, the National Telecommunications
Commission cannot pursue these cases and can only recommend
“blocking” the number used in the hoax. Blocking makes the
subscriber identification module, or SIM, card no longer usable.
Scams through text messaging continue to
victimize mobile-phone subscribers despite efforts of carriers and
government regulators to curb the crime.
Current estimates place the number of
mobile-phone subscribers at more than 30 million, many of whom are
subscribers to market rivals Smart Communications and Globe
Telecommunications.
Sun Cellular, a relative newcomer to the
mobile-phone business, is also enjoying brisk sales, and has logged
more than 1.5 million subscribers.
Analysts project that the growth in the number
of subscribers could also eclipse earlier forecasts of 20 percent,
to reach more than 30 percent this year.
The density is notable in a population of
roughly 82 million, indicating that mobile phones continue to
outpace the rollout of land-line telephones.
Text exchanges between the more than 30 million
subscribers, 90 percent of whom are on a prepaid scheme, also mean
big business for carriers. These daily exchanges of text messages
continue to generate billions of pesos in revenues.
However, with the significant increase in
mobile-phone users, the number of consumer complaints against text
scams is also on the rise.
An estimate from the Antimoney Laundering
Council said scammers have pocketed more than P5 million from text
scams in 2003. The figure is expected to increase in 2004 and 2005
once reports are verified.
Text scammers are also relatively hard to
pursue, because they can easily switch from one number to another or
can use multiple numbers to initiate the scam.
New scams
The NTC, the government agency that regulates
the telecommunications industry, is processing around 30 confirmed
cases under the OSPAC.
The OSPAC chief, Cuenca, said it is difficult to
give an estimate because thousands of cases remain unreported.
Victims are also reluctant to come forward and those who do have
requested confidentiality clauses in filing scam cases with the
OSPAC.
Edgar Cabarios, director of the NTC’s Common
Carrier Department, added that scammers often name-drop or cite
government agencies, like the Bangko Sentral ng Pilipinas, the
Philippine Charity Sweepstakes, and the Philippine Amusement and
Gaming Corp. to make the text messages more believable.
Ramon Isberto, public relations head of Smart,
said scammers often use “psychological” ploys to lure
unsuspecting consumers.
“A scam usually involves winning in a raffle
draw or lottery. The ‘winner’ is informed that he or she can
claim the prize from, say, the Philippine Charity Sweepstakes,
supposedly to persuade the winner to disclose personal data,”
Isberto said.
“This is the most common scam being reported
to us,” he said.
‘Hazy’ rules
Rules on how regulators and carriers should go
after text scammers, however, remain hazy.
Isberto said Smart cannot act on consumer
complaints and can only report cases to the NTC.
“Sometimes the police are needed in cases of
fraud through text messaging,” Isberto said, adding that carriers
have no legal authority to track suspected scammers.
The NTC’s Cabarios said, however, that
carriers could take action on scam reports, particularly on the
monitoring side.
He admitted, however, “it would be difficult
to track down and monitor these scammers, because they usually use
multiple numbers and are on prepaid arrangements. It would also be
costly for the carriers.”
Text scams fall under the crime of swindling and
estafa; thus rules on how carriers and regulators should act on
these cases remain unclear.
Bank secrecy laws also forbid agencies to open
bank accounts that are used in scams.
Going after the scammers
But the NTC has put in place several measures to
combat text scams.
The OSPAC’s Cuenca said the NTC will soon sign
an agreement with the Department of Trade and Industry, the Bangko
Sentral ng Pilipinas and the Antimoney Laundering Council, among
others, to create for an interagency task force that would look into
text messaging scams.
“The agreement will be signed before the end
of the second quarter,” Cuenca said.
The NCT has also filed a proposal in Congress to
make text scam a “special crime.”
Cabarios said the NTC expects to control text
scams more effectively through a proposed special four-digit number
to be assigned to carriers.
He said the NTC will hand down the memorandum on
this “anytime soon.”
The proposal requires carriers to direct all
promos, and raffles to the four-digit number to help consumers
indicate which promos are legitimate and which are scams.
Mother of all scams?
The consumer group TxtPower meanwhile says that
the bigger issue is “push” marketing that the carriers
themselves initiated.
Push marketing contains promos, invitations and
gimmicks that subscribers have not asked.
Anthony Ian Cruz, convener of the group, said
push marketing allows carriers to send out “unwanted” text
messages to subscribers, without giving them enough information
about their contents.
“The carriers usually send this promo inviting
subscribers to reply or to register to avail themselves of the
promo. What most subscribers don’t know is that they are being
charged for merely replying via text messaging,” Cruz said.
Although subscribers can easily ignore push
marketing, he said carriers may have been violating privacy laws,
because of the “abuse” of personal data from subscribers.
“Some carriers ignore the intended use of this
private information. They sometimes use this information for other
purposes, including sending out spams, or unwanted messages, through
SMS,” Cruz said.
He believes the money churned out by carriers
from push marketing could reach astronomical sums.
He said a mere one percent of the more than 30
million subscribers unwittingly replying to these promos could mean
that carriers can easily churn out millions of pesos daily.
The NTC apparently heeded the group’s calls
last week when it issued a circular ordering carriers and content
providers, which are firms directly engaged in sending promotional
materials through text messages, not to send unsolicited push
information.
The order, posted on the NTC website, said
carriers could send promotional materials provided they get
“explicit permission” from subscribers.
The memo also ordered carriers to stop sending
materials once a subscriber does not reply to these messages.
It also required simple messaging services to
display senders’ identity including addresses and numbers where
subscribers can send requests to stop the spamming.
Carriers were also ordered to act on consumer
complaints 30 days after receiving spam-related cases. The new rules
will apply to both simple messaging service and multimedia messaging
service, the NTC said.
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