Contributors

Thursday, October 06, 2016

Offshoring to India Results in Massive Fraud

For the last 20 years American companies have been offshoring their call center operations to India, Asia, Ireland and even Jamaica. Here's the result
Computer savvy criminals posing as Internal Revenue Service officers at call centers in India may have bilked unsuspecting Americans out of millions, police in India said Thursday.

Police in Mumbai conducted a dramatic midnight raid at a call center in the country’s commercial capital of Mumbai on Tuesday, and detained 770 employees for questioning, of which 70 were later charged with fraud, wrongful impersonation and violating the country’s internet safety law.

The call centers were making more than $150,000 a day through these scams that took place for a little over a year, police said.

The callers told their American victims they were conducting a “tax revision” or that they had defaulted on payments to the IRS and would then obtain their personal finance information and withdraw money from their bank accounts, according to Param Bir Singh, a senior police officer in Mumbai who led the raid.
How many times have you gotten one of those scam calls from "Microsoft Windows" to help you get rid of viruses on your computer?
Meanwhile, in another call center in the suburb of New Delhi, police say workers allegedly duped thousands of American citizens by offering to remove a virus from their computers. On Sunday, police in Noida arrested six people for running a call center that sold insurance to Indians by day, but by night, also allegedly duped American consumers with fake offers of tech support to correct malware and viruses. 
Numerous American banks, including Bank of America, JP Morgan Chase, and Wells Fargo, have moved their call centers to India and the Philippines. These call center employees make peanuts, and they have total access to their customers' most sensitive financial information.

American companies have unwittingly provided criminals in foreign countries with the office space, hardware, training and information to defraud American citizens.
Wells Fargo is undergoing a PR crisis because their American employees committed fraud on a massive scale as a result of unreasonable quotas placed on them. They are opening their customers up to even worse kinds of fraud and identity theft by putting their call centers in third world countries, where poorly paid call center employees come and go without any kind of background checks.

How safe are these call centers from attacks by Russian and Chinese hackers? Or someone just walking in and using the computer of someone who went to the bathroom?

The president of the Philippines has been on an anti-American rampage for the last month, comparing himself to Hitler and threatening to cut military ties to the United States. This man controls the Internet infrastructure that connects Philippine call centers to bank databases in the United States. Do you trust Rodrigo Duterte with your financial data?

As Wells Fargo has shown, American employees are not angels. Wells Fargo management was in the same building where agents were creating fake accounts for customers, racking up billions in phony fees. But with call centers in foreign countries, management has no control over what happens to their customers' information.

I'm not an isolationist. If companies want to put tech support in India and Jamaica, that's fine. But putting all our financial data on the Internet in foreign countries seems extremely unwise: the US government has no jurisdiction over what goes on there; we're totally dependent on foreign governments to find and prosecute the people stealing our information.

This is just the tip of the iceberg. It has the potential to be blow up even bigger than the Great Recession.

No comments: