Security Experts:

Four Arrested for Hacking Phone Systems to Fund Terrorism

The Philippines Criminal Investigation and Detection Group (CIDG) said on Saturday that with the help of the FBI, four people have been arrested and stand accused of running remote toll scam in order to fund terrorism.

AT&T Hackers Arrested in PhilippinesAccording to a statement from the CIDG, the three men who were arrested (and a female who was a live-in partner of one of the three) hacked the main trunk-lines for several AT&T customers, forcing the businesses to dial expensive toll numbers, which the men controlled.

The money collected from the hijacked calls would then be funneled to a group called Jemaah Islamiyah, who has been linked to the 2002 bombings in Bali, as well as al-Qaida.

CIDG director, Samuel Pagdilao, said the four arrests, stemmed from a complaint made by AT&T, adding that the scam resulted to almost $2-million in losses incurred by the company. AT&T would not confirm the losses incurred by the crime. In a statement made over the weekend, the telecom giant did it had reimbursed customers for their losses.

The FBI confirmed that it was involved with the investigation, and helped the Philippine agency build their case; they offered no additional comment on the investigation.

The CIDG said that the FBI has been investigating incessant hacking of telecommunication companies in the U.S. and abroad since 1999.

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Steve Ragan is a security reporter and contributor for SecurityWeek. Prior to joining the journalism world in 2005, he spent 15 years as a freelance IT contractor focused on endpoint security and security training.