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Banks (Finance)

Mobile Phone Companies Face Compensation Claims Over Sim-Swap Scams

Strategic Insights

— 2 min read

Scam victims are claiming hundreds of pounds in compensation from their mobile phone companies, alleging that they failed to protect their privacy and breached data protection rules. Many of these victims have already been fully refunded by their banks for their loss, but are now taking mobile phone companies to court for their alleged negligence. The latest wave of scams involves scammers taking over mobile phone numbers using a system meant to make it easier for customers to switch between phone companies while keeping their original number. Scammers use what are known as Sim-swap scams to take over mobile phone numbers, allowing them to receive banking codes and transfer funds from unsuspecting victims' accounts.

Key Takeaways:

  • Scam victims are claiming hundreds of pounds in compensation from mobile phone companies, alleging breach of data protection rules and failure to protect their privacy.
  • Many of these victims have already been fully refunded by their banks for their loss, but are now taking mobile phone companies to court for their alleged negligence.
  • The mobile phone industry has warned banks about the vulnerability of text messages in Sim-swap scams.
  • Karen Hilton, a 53-year-old woman from Oldham, was awarded PS1,400 in compensation from EE after scammers took over her account, using a Sim-swap scam.
  • Giuseppe Schillaci, a 66-year-old man from Broxbourne, Hertfordshire, had PS3,400 stolen from his NatWest account and is claiming PS5,000 from EE for their alleged negligence.
  • EE has acknowledged that an error had been made in Schillaci's case and offered PS50 compensation.
  • The Information Commissioner's Office has stated that mobile operators must take reasonable steps to address any risks posed to personal data when processing switching requests.
  • EE requires security information, such as date of birth and address, to process Porting Authorisation Codes (PAC). However, fraudsters have been able to acquire customers' login details using targeted phishing scams or by finding them online.
  • EE has introduced a One Time Pin number to be sent to customers when their accounts request a PAC code, resulting in a 97% reduction in fraudulent phone number porting cases.

Statistics:

  • PS14,000: The amount lost by Karen Hilton after scammers took over her Yorkshire Bank account.
  • PS1,400: The amount awarded to Karen Hilton in compensation from EE for her loss.
  • PS3,400: The amount stolen from Giuseppe Schillaci's NatWest account using a Sim-swap scam.
  • PS5,000: The amount Giuseppe Schillaci is claiming from EE for their alleged negligence.
  • 97%: The reduction in fraudulent phone number porting cases following EE's introduction of a One Time Pin number.

Sources:

  • "Scam victims claim hundreds of pounds in compensation from mobile phone companies" (BBC News, no date)
  • "EE faces compensation claims over Sim-swap scams" (The Guardian, no date)
  • "Karen Hilton, 53, from Oldham had a text message in December 2019 saying that EE was sorry to see her go" (The article itself)
  • "Giuseppe Schillaci, 66, from Broxbourne, Hertfordshire, was going through cancer treatment and needed a phone to keep in contact with doctors" (The article itself)
  • "The Information Commissioner's Office said: 'Where mobile operators receive switching requests, they must ensure they take reasonable steps to address any risks posed to personal data'" (The article itself)

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