To bypass that termination fee, one fraudster can have a SIM Box to terminate off-net traffic on the radio network of a company. Only switch to switch traffic is charged for the termination fee. With a SIM Box, you can convert fixed line calls to mobile calls, using that box and activated SIM cards. The trick is that companies offer to buy off bundles for on-net traffic, say for € 5 a month you can call as much as you want to customers of the same network. Or they have really low on-net tariffs like 5 cents per minute. They can do that since there is no cost involved for that company since as we saw in the example there are no costs for that company, as long as the calls are started and ended by their own customers.
So the fraudster gets some sim cards with a tariff of 5 cents per on-net call each for network A. He puts them in the SIM Box and then starts to advertise. Normally when another company want to terminate a call to a customer of company A they have to pay let’s say 15 cents per minute to company A. (Not the actual price, but for making it easy to understand) But they only have to pay that when traffic is connected through the switches. The fraudster then can approach company B and tells them that he is able to terminate all their traffic towards customers of company A, but for only 10 cents per minute. Company B agrees because that tariff is 5 cents per minute less than if they handover the traffic directly to the switch of company A. They now send their traffic to the SIM Box of the fraudster that converts the traffic to mobile calls, just as if it was a giant handset with multiple SIM cards in it. Since the fraudster only has to pay the subscription fee and a tariff of 5 cents per minute while receiving 10 cents per minute he is making a profit of 5 cents per minute, per SIM. He off course pays his bill right away because he wants his SIM cards open. Since the traffic is huge 5 cent per minute per SIM means he earns € 72 each day per SIM. So if he has 10 SIMs, he is earning € 720 a day just by having that SIM Box active.
Company A then has a customer that has a monthly bill of let’s say € 20.000. At first, they are happy with such a customer that pays his bills every month. But instead of gaining € 20K, they lose € 40K each month, because if all that traffic was presented at their switch they would have billed company B € 60K for those calls.
This is SIM Box fraud in a nutshell. in reality, it’s more sophisticated than this, but it will give you an idea of how it works.
Thank you, Quora.