In recent years, SIM swap fraud has emerged as a significant threat to consumers and businesses alike. According to a recent report by The National Fraud Database in the United Kingdom, this type of fraud has skyrocketed by 1,000% in the past year [1], with criminals using it as a tool to exploit two-factor authentication systems and gain unauthorized access to personal accounts.
What is SIM Swap Fraud?
SIM swap fraud is a type of scam that occurs when attackers use illegally acquired personal information and deception to gain unauthorized control of a victim's mobile phone service. Firstly, the attacker uses illegally obtained personal information to deceive a mobile carrier to transfer a victim's phone number to a new SIM card. Once the attacker has control of the victim's phone service, they can intercept text messages and calls, including those used for two-factor authentication. Ultimately this allows the attacker to gain access to various online accounts such as the victim's bank accounts, social media profiles, employee accounts, and then exploit them for financial gain.
What's Behind the Recent Surge?
The dramatic increase in SIM swap fraud can be attributed to several factors:
The Rise of Two-Factor Authentication: While two-factor authentication (2FA) is designed to enhance security and has been adopted widely by businesses, criminals are finding ways to bypass it.
Increased Dependency on Phones: As more people conduct their work and commerce using their mobile phones, the opportunities for fraudsters to exploit vulnerabilities have grown.
Sophisticated Social Engineering: Fraudsters use advanced techniques to trick mobile carriers into transferring phone numbers, often posing as the victim using stolen personal information.
Combating SIM Swap Fraud
To protect your users from SIM swap fraud, consider the following measures:
Strengthen Account Security: Use alternative screening and authentication measures beyond SMS-based 2FA where possible. This includes Data Zoo’s suite of ID Fraud & Risk Signals as a screening service.
Monitor Account Activity: Regularly check user accounts for any unusual activity including updated account information. Data Zoo can provide batch data remediation services where necessary.
Educate Yourself and Others: Stay informed about the latest fraud detection techniques by speaking with our industry experts and our network of platform partners to find the best solutions to suit your requirements.
Real-World Impact
The consequences of SIM swap fraud can be devastating. Victims often face financial losses, significant emotional distress, and snowballing privacy violations. Businesses also suffer, as they must deal with the fallout from compromised customer accounts and the erosion of trust, including significant legal actions and penalties.
The rise of SIM swap fraud is a stark reminder of the persistent and evolving nature of cyber threats. By understanding how the latest scams work and taking proactive steps to secure accounts, you can help protect your business and your users from financial and reputational risks. Data Zoo ID Fraud & Risk Signals are designed to help our customers stay vigilant and informed in real-time while maximizing opportunities in the evolving digital landscape safely.
[1] Cifas, 2025: Fraudscape Report