This party line is no party when you get the bill

| Oct 24, 2014 | Business Litigation

Businesses face many risks. They range from risks of your employees being injured on the job, to the threat of one of those employees absconding with your intellectual property or embezzling your funds. And there are endless, but more mundane risks, such as a fire in your building destroying your business records or weather related problems, such as floods or Nor’easters shutting your business down.

You hire attorneys, accountants and insurance agents to help assess and manage the types of risks to which you are exposed. With technology, the risks seem to multiply, from having your confidential accounts hacked to technological failures of your servers leaving you unable to function.

But it is the risk you or your professionals don’t see that can turn into a significant problem. Few businesses worry about their phones. The technology seems stable and much of the time utterly transparent.

However, a phone hacking scheme that allows third-party entities to high-jack a business’s phone lines over a weekend, can saddle a business with staggering phone bills. Large carriers have systems to detect this type of operation and can afford to forgive fraudulent traffic.

Some smaller carriers cannot, and as one spokesperson puts it, “someone had to pay for those calls.” This scenario played out one weekend in upstate New York, where hackers ran 75,000 minutes of premium calls through small businesses’ phone lines. Some received bills of $200,000.

The small carrier sued and though the litigation eventually led to settlements, one laundry company noted they had to abandon an expansion due to the unexpected expense.

The risk is real and the consequences can be extreme. The Times article points out you should treat your phones as “internet connected machines,” and ensure their password protection is commensurate.

The New York Times, “Phone Hackers Dial and Redial to Steal Billions,” Nicole Perlroth, October 19, 2014