On February 8, 2010 a speculative paper on the likelihood that fraudsters proficient in missing trader intra-community (MTIC) fraud might move into voice over internet protocol (VoIP) was submitted to the Boston University School of Law Working Paper Series.
Prior to that paper there was very little (if any) public discussion of VoIP MTIC. There were no assessments, no arrests, and not a hint of litigation. Fifteen days later, and before final publication the financial press exploded with coverage of a massive VoIP MTIC fraud (the Operazione “phuncards-broker” investigation). The Wall Street Journal reported: An [Italian] judge…ordered the arrest of 56 people, including one of Italy's richest men as part of an international probe into an alleged $2.7 billion money-laundering and tax-evasion scheme involving two major Italian telecommunications providers.
Because of the importance of the phuncards-broker investigation, this paper follows these allegations, relates them to the earlier speculative paper on VoIP MTIC, and then demonstrates why this is a global problem with a digital solution.
MTIC is becoming a serious problem in such a large number of economic sectors that it is beginning to double up on itself. Not only are fraudster migrating from one type of MTIC to another, and not only is MTIC mutating from goods into services, but the proceeds of one MTIC fraud are clearly being laundered through another. A significant portion of the funds laundered through the VoIP MTIC funds in Operazione “Phuncards-Broker” came from previously successful CO2 MTIC frauds. It is only a matter of time before the true cost of MTIC is tallied.
Richard T. Ainsworth,
VoIP MTIC - The Italian Job (Operazione 'Phuncards-Broker')
Available at: https://scholarship.law.bu.edu/faculty_scholarship/1472