Risk Alert: SIM Swapping and Port-Out Fraud Leads to Account Takeovers

Fraudsters are hijacking members’ mobile devices through SIM swapping and portout scams that result in account takeovers. Both scams provide the fraudster with the ability to receive calls and SMS text messages intended for the mobile phone users.

• In the SIM swapping scam, a fraudster impersonates a mobile phone user and social engineers the user’s mobile phone carrier into activating a replacement SIM card the fraudster has in their possession.
• The port-out scam is similar except that the fraudster social engineers a mobile phone carrier into porting the user’s mobile phone to a different carrier.

These scams are used by fraudsters to intercept two-factor authentication (a.k.a. out-of-band authentication) passcodes that are needed to login to member accounts through online banking. Fraudsters also hack member email accounts and social engineer credit union call center employees to change member mobile phone numbers and/or email addresses to intercept two-factor authentication passcodes.

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