FIGHT BACK!  BY DAVID HOROWITZ

Phone Cloners Busted

        Federal authorities in Northern California recently an- nounced the arrest of a man they 
called a kingpin of cellular  phone fraud. Clinton L. Watson of San Jose and two associates  are 
charged with making and selling so-called "clone phones"  -- cell phones that are programmed to 
charge calls on other  people's phone numbers.
        The basic techniques of cloning cell phones has been  around for several years. The 
thieves use what's called an  ESN scanner to monitor cell phone transmissions and trap the  
phone's identity code. That code is then imprinted on a  computer chip, which is installed in 
another cell phone,  making it an exact duplicate, or "clone," of the original.  All calls placed 
from that counterfeit phone go on the  original owner's monthly bill.
        According to the U.S. Attorney's office, Watson devel- oped a very sophisticated computer 
program that allowed him  to install as many as a dozen different phone numbers in a  single 
phone. These "lifetime phones" could then be switched  from one number to another directly from 
the keypad. When one  stolen number was deactivated, the user simply switched to  another 
one, which greatly extended the useful life of the  clone phone.
        Prosecutors say Watson sold nearly 1,000 phones for  $1,000 to $2,000 apiece. He also 
allegedly sold his computer  program to other cloners for as much as $100,000 a copy.
        That gives you some idea of how profitable selling clone  phones can be. Industry experts 
believe cellular carriers are  losing $1 million a day to this kind of fraud. In the Los  Angeles area, 
which has more cells phones in use than any- where else in the country, 25 percent of the calls 
made  through the cellular system are believed to come from  counterfeit phones.
        Who uses clone phones? Drug dealers and other criminals  who don't want their phone 
transactions tapped or traced,  businesses and individuals who want to cut their calling  costs, 
and people who operate clandestine "phone rooms,"  where callers are charged a flat rate to 
place long-distance  calls anywhere in the world. It's a big money operation.
        The cellular phone companies are now developing their  own electronic countermeasures. 
LA Cellular, a major carrier  in Southern California, now offers a Fraud Prevention  Feature, which 
requires dialing a seven-digit access number  before a call can be placed from that phone. Only 
the user  knows the number, and the company says it cannot be picked up  by scanner in the 
phone's data stream transmission. Right  now, FPF is an option, but it could become a standard 
feature  in the future.
        LA Cellular is also experimenting with a system that  automatically analyzes individual 
cellular transmissions and  identifies an electronic "fingerprint" for each phone. If  someone tries 
to use that number from another phone, it won't  go through. Many carriers also track their 
customers' calls,  looking for sudden changes in calling patterns.
        Right now, your best protection against being ripped off  is to watch your monthly phone bill 
closely. If there are any  unauthorized calls, report them immediately to your phone  company, 
and the charges will be deleted. You can also ask  your carrier to block overseas calls from your 
phone.
        If you have any questions or comments, please write to  David Horowitz in the Consumer 
Forum+ (go FIGHTBACK).

COPYRIGHT 1994 CREATORS SYNDICATE, INC.