What Is Artificially Inflated Traffic?

The three issues in A2P messaging that are costing brands significant money are:

1. Price increases
2. AIT
3. Exclusivity deals

The modern digital landscape, while providing unprecedented connectivity and convenience, has also given rise to a myriad of complex security challenges. One such covert menace that has been gaining momentum under the radar is Artificially Inflated Traffic (AIT) fraud, particularly in relation to SMS verification practices.

This nefarious scheme involves the generation of high volumes of fraudulent traffic via mobile applications or websites, which can have serious financial and reputational implications for businesses.

An Overview

Artificially Inflated Traffic (AIT), also known as Artificially Generated Traffic (AGT), is a type of SMS fraud that leverages automated processes or bots to generate a surge of fake traffic via mobile applications or websites. 

This scheme primarily targets platforms that use SMS verification, specifically one-time passcodes (OTP SMS), as a security measure. A typical AIT scenario unfolds as follows:

• A cybercriminal devises a bot to generate fake accounts on a web service or application.
• The said bot triggers an OTP SMS to various mobile numbers.
• The fraudster collaborates with a rogue party, such as a small mobile network operator (MNO), to intercept the inflated traffic without delivering the messages to the supposed end user.
• The fraudster and the rogue party share the generated revenue and repeat the cycle to further inflate revenues or manipulate conversion statistics.

This deceptive network not only results in significant financial losses for enterprises but can also potentially tarnish their reputation and undermine customer trust.

The Rise of AIT Fraud: Driving Factors

Several factors contribute to the increasing prevalence of AIT fraud. 

1. The escalating costs of application-to-person (A2P) SMS services make the profit potential of AIT schemes increasingly attractive to cybercriminals. Some even utilize the proceeds from AIT schemes to fund legitimate SMS traffic, leveraging the profitability of AIT to offset costs. One should always select reliable SMS verification services.
2. Another factor is the relative difficulty of identifying AIT fraud due to its lack of regulation within common SMS agreements and regulatory frameworks. This enables AIT to bypass MNO's firewalls, as OTPs are not typically flagged as spam or prohibited content.
3. Lastly, the development of more sophisticated bots and software makes it easier for fraudsters to mimic real user behavior and avoid detection. These systems are being commercialized as software-as-a-service solutions and made available to non-technical users and traditional organized crime gangs.

The Impact of AIT Fraud: A Multifaceted Threat

Since promotional SMS has also gained popularity because of its wide reach, AIT has increased. The advent of RCS, the version of SMS with rich media and for one which you sometimes receive ‘sent as SMS via server’ has added fuel to the fire.

1. AIT scams can lead to substantial financial losses for enterprises. Increased traffic from the scam can result in inflated costs for SMS services or revenue-sharing agreements, impacting the company's profitability.
   For instance, Elon Musk claimed Twitter lost $60 million a year due to AIT-based scams, leading the platform to limit its use of OTP SMS verification.
2. Beyond financial repercussions, AIT fraud can also damage a company's reputation. When users receive multiple OTPs that they did not request, doubts are raised about the integrity and compliance of the businesses involved, eroding customer trust and potentially driving consumers towards alternative avenues.
3. Furthermore, AIT scams can interfere with compliance with data privacy and security laws, leading to potential legal and regulatory implications. They also expose businesses to data breaches, spam, phishing, intellectual property infringement, and other types of threats, resulting in violation of regulations and potential penal action and hefty fines.

Best Practices for Mitigating SMS Verification Fraud

To thwart AIT fraud, businesses need to adopt a multifaceted approach, combining detection, prevention, and response strategies. Here are some best practices for mitigating SMS verification fraud:

Regular Audits

Conducting regular audits of mobile traffic and advertising campaigns can help identify inconsistencies or irregularities in data indicative of fraudulent activities.

Skills and Awareness

Ensure that teams understand the risks and signs of AIT scams. An educated team is better equipped to spot potential fraud and take action.

User Behavior Analysis

Understanding the behavior of legitimate users can help distinguish between genuine and fraudulent traffic. This can be achieved through advanced analytics tools and machine learning algorithms that can analyze data patterns, detect anomalies, and flag suspicious behaviors.

Trustworthy Ad Networks

For businesses engaged in digital advertising, it’s crucial to partner with ad networks known for taking proactive measures against fraud. These networks have strong systems in place to identify and mitigate AIT scams.

Bot Detection and CAPTCHAv2

Implementing CAPTCHAv2 on mobile apps, particularly on forms and other interactive elements, can drastically reduce bot activity. This service helps distinguish between human users and bots, which are often used in fraudulent activities to mimic human behavior and generate fake traffic.

Rate Limiting

This technique involves setting a limit on the number of requests a user or IP address can make within a certain timeframe. This can slow down or halt fraudulent traffic, especially from bots performing high-frequency activities.

Device Fingerprinting

This technique identifies and tracks devices based on their unique configurations. By doing this, companies can identify suspicious patterns or recurring fraudulent activity coming from the same device, even if they change their IP addresses or use VPNs.

Honeypots

Honeypots are decoy systems or traps that appear as part of an organization’s network but are actually isolated and monitored. They are designed to lure in attackers, who waste their time and resources on the decoy while their actions are recorded and used to improve security measures.

Switch to Passkeys

Switching to passkeys, which are always changing, can solve a number of problems, one of which is that there is no real password to leak.

As technology continues to evolve, so do the forms of AIT fraud. Staying informed and up-to-date is fundamental. Continuous learning, adaptability, and vigilance are key to staying one step ahead of the fraudsters. By understanding the risks, taking proactive measures, and working together, these risks can be mitigated to create a safer, more trustworthy digital environment.

You can also refer to our detailed guide on OTP SMS fraud prevention.