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US$430,000 Regulatory Fees: Comium Complains to State House

In Sierra Leone, it would appear that the Mobile Telecommunication Companies are in control of the country’s Regulatory Body called NATCOM. They dictate the pace, with which the Commission should regulate their activities which has given rise to Sim Box Fraud and other telecommunication fraud. Just last Friday  the Chairman of the National Telecommunication Commission Mr. Siray Timbo came down heavily on telecom operators in the country in a interactive forum with consumers and operators at the Shangri-La Beach Resort in Lumley.

Consumers at the forum comment on the poor quality of service provided by the telecom operators, which has been depriving them of their hard earned money. They also commented on the rate of Sim Box fraud, which some consumers have resorted to over the years with no punitive measures from the Regulatory Body.

 What is evident among the operators is the rate of SMS lottery that all of them have resorted to, which is outside their mandate of operation and the Regulatory Body has maintained silence over this kind of illegal activity done under the guise of SMS messages and are not paying tax to the government, instead they are taking from the consumers.

Apart from the poor service mentioned, the telecom operators are also in the habit of not honouring their yearly regulatory fees on time to the Commission. A case in point that was recently reported by the media is Comium, which issued a bounced cheque to the Commission for 2011, with an outstanding payment still hovering around its neck and when the issue was reported by the media, Comuim got wild and started lashing out at the Commission, accusing it of breach of confidentiality.

As if the lashing out at the Regulatory Body was not enough for Comium, it took the unimpressive step of reporting the Commission to State House that has no business in debt collection or regulating telecom operators in the country.

The report of Comium made mention about its investment in the country and explained that the Commission was in a rush to withdraw money through what they described as SPECIAL CLEARANCE prior to the stipulated date meant for withdrawal on the cheque.

 The report of breach of confidentiality to State House has not absolved the company from its indebtedness to the Commission as report states that it has still not been able to pay its 2012 regulatory fees to the Commission despite boastful and bogus statements of huge investment in the country.

While the Commission may be pampering delinquent telecom operators who are also depriving consumers and providing poor interconnectivity service, the Ghana National Communication Authority is taking a hardliner stance against telecom operators. As if the notion of interacting with telecom operators was coordinated between the National Telecommunication Commission (NATCOM) in Sierra Leone and the Ghana National Communication Authority, last week the two bodies met with their operators. In each of the meetings, which went on separately and independently they spoke their minds.       

The National Communications Authority of Ghana (NCA), the Regulatory Body made it clear that if it discovers any illegally acquired SIM cards being used for SIM Box fraud, the respective telecom operators would be held responsible and made to pay for it. On March 3, 2012, it was reported that telecom operators in Ghana deactivated more than 1.5 million unregistered and invalidly registered inactive SIM cards as a measure to, among other things, stem SIM-based unlawful activities, including SIM box fraud. The Director of Regulatory Administration at the National Communication Authority, Mr. Joshua Peprah explained that SIM registration is one of the main measures to track down SIM Box fraudsters and so after the deactivation of the unregistered SIMs, the operators are expected to keep records of only legally registered SIMs with the identities of the owners. It is not known whether NATCOM has informed telecom operators in Sierra Leone that they would be responsible for the use of any unregistered Sim by consumers as it creates openings for security risk and promotes telecom fraud “If we discover that any SIM card has been used in a SIM box, we will go to the concerned operator to give us the identity of the owner of that number – if we discover that the SIM was illegally acquired then that operator would have to pay government its portion of the expected revenue from the international call terminated through that SIM,” The Ghana Director of Regulation was quoted to have said.
He was speaking to journalists who had gone to visit the NCA as part of a four-day training workshop organized by Media Foundation for West Africa (MFWA) with support from one of its popular operators called MTN to improve telecoms reporting in Ghana. SIM Box fraud has been explained as a system by which some unscrupulous persons re-route international calls. In Sierra Leone, like in Ghana it is not new and fraudsters make huge money from this illegal system. The calls go through some boxes in which they have inserted local SIM cards, and they terminate the calls using those SIM cards, to make the call appear a local call. So, for instance, often times an international call appears as 076xxxxxx/033xxxxxx/077xxxxxx for Sierra Leone and in Ghana it is 0266XXXXXX number, meaning the SIM Box fraudster is terminating the call through either Airtel SIM card, Comium or Africel. By doing so the fraudsters pay local rates to the operators, after their cohorts abroad have collected the international rates from the telecom companies which originated the call overseas. SIM Box fraud denies the state millions of dollars in taxes and also denies telecoms even bigger revenue. In 2009 alone, SIM box denied Ghana government an estimated US$5.8 million in taxes per month, and at the global level it denies the telecom industry some US$150 million in 2010. Records in Sierra Leone indicating loss to both the government and telecom operators and revenue gained cannot be adequately and properly accounted for as a result of improper management and monitoring mechanisms.
As a result, the Government of Ghana passed the Electronic Communication Amendment Act, Act 786, 2009, which fixed the tariff for inbound international call at 19 cents (33Gp) per minutes, out of which 6 cents is for government and 13 cents goes to the telecom operators. This Act has not been passed in Sierra Leone and it is not known whether it would be part of the Agenda for Change of this government. The passing of this legislation, it would be recalled was not a moment of celebration for telecom operators. Some telecoms argued that the 19 cents fixed rate is rather encouraging SIM Box fraud because it is high, compared to the lowest flat local call tariff, which is currently 8.4Gp, so the fraudsters are able to make lots of money even if they charge less than 19 cents and terminate the call at only 8.4Gp.
They further argue that reducing international call rates to the level of domestic call rates will automatically drive out SIM box fraudsters like it is done in other countries such as Nigeria. But Mr. Peprah explained that while 19 cents may be an attraction for SIM box fraudsters, the NCA cannot reduce international call rates to the level of domestic call rates just because of the bad guys, adding that the good guys like the telecoms in Ghana are now getting an assured 13 cents per minute of international call, and government is also getting an assured 6 cents for national development. “Through dynamic regulation the country’s telecom industry has grown and become very attractive and huge international traffic is coming in everyday and the country has the right to benefit from that” He said and added “we are not going to sacrifice that benefit just because some bad guys are stealing from us,”. NATCOM, since its establishment has not come up with rates for international and local calls, despite it is part of the regulation mechanism; everything is left in the hands of the telecom operators who are increasing tariffs at anytime and moment they choose to do so at the detriment of the consumers and even cheating them.
 With the implementation of the fixed rate, both government and the telecoms have raked in millions of dollars, which would have been lost to SIM Box fraudsters, and to persons who also route calls through VOIP (voice over internet protocol) and pay only about 5 cents to telecom operators in Ghana.

Last year, report shows that the Regulatory Body in Ghana raised almost US$60 million for the state through the fixed rate, and that is why the body is demanding all telecoms to keep records of registered SIM cards to enable them track down fraudsters, otherwise the telecoms would have to pay the 6 cents if it is discovered that their SIMs in SIM boxes have been used illegally.

Meanwhile, latest trends indicate that the SIM box fraud is going down in Ghana, and the fraudsters are getting busted and some are leaving the shores of the country because the NCA and the telecoms have put systems in place to track and flush them out, while in Sierra Leone the Sim box fraud is gaining upper hand.

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