The fight between Taiwan and mobile fraud

• Jeff Kuo, head of telecom security, claims that Taiwan is at the forefront in the fight against mobile phone fraud.
• Mr. Kuo is the CEO of the Taiwanese company Gogolook, which is the owner of Whoscall, one of the most widely used spam-blocking apps on the island and throughout all of East Asia.
• Jeff Kuo, who is still working at spam-blocking service Whoscall, concurs, stating that while the struggle against fraudsters “may never cease, so is our determination to develop our skills and stand up,”

Here in Taiwan, where we witness many forms of advance deception, this is like a miniature version of the rest of the world, said Mr. Kuo. Because we can anticipate events before they occur, we can use this information to safeguard other nations.

Mr. Kuo is the CEO of the Taiwanese company Gogolook, which is the owner of Whoscall, one of the most widely used spam-blocking apps on the island and throughout all of East Asia.

It claims that its artificial intelligence-powered software continuously combs through more than 1.6 billion phone numbers, including Taiwanese numbers as well as those from Asia and other regions, to reject calls and texts from suspected scammers.

Working with the “165 Anti-Fraud Program” of the Criminal Investigation Bureau (CIB) of Taiwan, Whoscall banned more than 52.3 million scam calls and 13.1 million scam mails in Taiwan alone in 2016.

But why does telecom fraud in Taiwan seem to be so prevalent? According to Mr. Kuo, the island’s small population of 23.5 million makes it the ideal “practise field” for organised criminals from mainland China and other countries as well as Taiwanese gangs. They test a new phone fraud in Taiwan, and if it is successful there, they can use it all of Asia and eventually the world.

According to Mr. Kuo, “[For instance], we give Apple a lot of evidence… till they realise there is a big concern.” “A problem that will not only expand to Taiwan but also to the Asia Pacific region, and if they don’t address it, it will quickly reach Europe and the US.”

Another reason why so many new scams start on the island, according to CIB telecoms fraud inspector Jean Hsiao Ya-yun, is the very fact that Taiwan is one of Asia’s top producers of high-tech equipment. She claims that Taiwanese con artists share this level of technical proficiency.

According to Ms. Hsiao, the coronavirus pandemic was a golden period for con artists because it caused millions of people to stay at home and become more dependent on their phones.

She continues, “And the Taiwan stock market was quite high at the time, so many individuals earned a lot of money.” She adds that this resulted in an enormous increase in investment frauds.

“Scammers might, for instance, offer advice on app sites or start a chat group where they claim to be able to predict when a stock will rise and will share this information with you if you join.”

The con artists would then demand payment in exchange for the data. Other investment frauds involve calling victims on the phone and offering them loans at extremely low rates.

Due to the size of the criminal organisations responsible for the scams, some Taiwanese gangs have established operations abroad. Ms. Hsiao cites an example from 2020 in which Montenegro detained 92 Taiwanese citizens.

Other times, false promises of high income are used to entice Taiwanese citizens to travel abroad, particularly to places like Cambodia. As reported by the BBC in September, people are compelled to labour there against their will as telephone fraudsters.

Mr. Kuo acknowledges that fraudsters and anti-fraud companies like his are engaged in a “arms race.” Millions of messages and phone calls are blocked by Whoscall and similar programmes, but some still get through.

Regardless of age or country, anybody who has lived in Taiwan is familiar with one technique utilised by fraudsters: burst dialling. When you answer an unknown number, you first hear a brief dialling sound before a pre-recorded message begins to play.

These calls are placed using auto-dialing devices that can place hundreds in a minute. It’s a good approach for scammers to track down active phone numbers of people who are willing to answer the phone even when they have no idea who is calling.

TonTon Huang, a cyber security specialist from Taiwan, claims that once such a person has been identified, con artists will phone them again.

If they discover that the number is in use, they will either sell the active phone data or notify you that you must make a loan or insurance payment or send money, the author claims. The most frequent one appears to be regarding instalment payments, such as when you order online and must pay in instalments or whatever.

Scammers still con a lot of young adults, according to Ms. Hsiao of the CIB, although they tend to target older people who might not be as tech savvy or aware of scam tendencies.

A 20-something Taiwanese YouTuber named Edison Lin disclosed in an emotional video that he had fallen victim to phone fraud earlier this year.

He had been defrauded of $13,000 [£12,600] by two con artists who conspired.

Mr. Lin claimed it occurred after he received a call from someone posing as an employee of a restaurant he had recently visited. He was unintentionally overcharged $380, the man claimed, and was going to be given help to get his money back.

After Mr. Lin concluded the call, the other fraudster pretended to be his bank and called him shortly after.

In his video, Mr. Lin stated, “When the [false] clerk from E.Sun Bank contacted, he understood the complete thing and he informed me how to collect compensation from E.Sun.” His expertise led me to believe that he worked as a bank clerk.

“I saw one of them moving [my] money after we had been exchanging messages for a short while… I haven’t finished paying off the debt yet.

An internationally recognised authority in the application of AI software systems is Prof. Sandra Wachter, senior research fellow in AI at Oxford University.

She claims that while the general public has to be properly informed about the hazards, AI can be a useful tool in combating telecoms and other tech-based crime.

Technology is being utilised to scale up fraud attempts, according to the expert. This enables con artists to operate more effectively and cast a larger net. “At the same time, because texting or calls appear real, especially when done in compelling and sophisticated ways, some people might be more naive and susceptible to deception.

“Since fraud is growing, the approach to stop it must grow as well, making the use of AI technologies for this reason a sensible choice.

How successful are these efforts, and will we be able to completely halt this behaviour, is the question. We can temporarily stop it, but the answer is probably not. People can avoid falling into the trap with the help of digital literacy and education. AI can assist in identifying these scams and taking action.

Jeff Kuo, who is still working at spam-blocking service Whoscall, concurs, stating that while the struggle against fraudsters “may never cease, so is our determination to develop our skills and stand up,”

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