Phone Hacking Scam Linked to Terrorists

Dennis Faas's picture

A telephone hacking scam targeting AT&T's business customers may have helped finance terror attacks in Asia. Three men arrested in connection with the scam have been linked to 2002 terrorist bombings in Bali.

The three men, along with a woman, were arrested last Wednesday (November 23) in the Philippines. The group has been blamed by the FBI for funding attacks in India in 2008, though other sources argue a Pakistani organization was responsible for that incident.

The FBI is now working with police in the Philippines to investigate whether the four were involved in a US-based scam that provided terror groups with money to fund future attacks. The scam appears to date back at least to 2009. (Source:

AT&T Customers Targeted in Phone Scam

In this particular case, the phone systems were those of AT&T customers. It appears the scheme involved hacking into the phone systems of businesses with large budgets.

These bigger firms, with more red tape surrounding their phone bills, were prone to having unusual or illicit expenses escape immediate notice.

Once the scammers got access to a phone systems, they made phone calls in a way that increased the bills of the unsuspecting businesses. The scammers diverted their share of that revenue to a bank account, then quickly disappeared.

It appears the hackers were able to exploit customers who had allowed remote access to their system and protected it only with weak passwords. AT&T has stressed that it has refunded the losses of all its customers hit by the scam.

Total Haul Tops $2 Million

Neither the FBI nor AT&T have confirmed claims by Philippines police that the total amount stolen in the scams topped $2 million. It appears the scammers themselves passed the money directly to terrorist groups, after taking a cut of the revenue.

There have been claims the Philippines is a particularly attractive base of operations for high-tech scammers, partly because law enforcement officials lack the advanced technical capabilities of their counterparts in other countries, and partly because of deficiencies in domestic legislation on such issues. (Source:

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