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Two charged with VoIP fraud

Hacking returns to phreaking roots

Internet Security Threat Report 2014

Two men were arrested yesterday and charged with wire and computer fraud. They are accused of secretly routing phone calls into VoIP services without paying for them.

Edwin Pena, a 23-year old man living in Miami, started two companies offering wholesale phone services - smaller telco providers often buy bulk packages of minutes from such companies. But Pena wasn't buying wholesale telco minutes, he was getting them by hacking into various VoIP providers. Robert Moore, 22-years-old from Spokane, Washington, allegedly helped him.

To cover their tracks the two routed calls through unprotected network ports at other companies to route calls onto providers. Over three weeks, the two routed half a million phone calls to a VoIP provider in Newark via a company based in Rye Brook. Federal investigators believe the two made as much as $1m from the scam.

Observers say the ease with which the two accessed the networks shows a general lack of security among new VoIP providers

Moore is currently free on bail while Pena has a bail hearing later today. More from the New York Times here. ®

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