Police say hackers stole phone time from AT&T, others

An Italian magistrate has issued an international arrest warrant for a Filipino hacker suspected of causing millions of dollars of losses to telecommunications multinationals, and Italian police have arrested five Pakistani nationals accused of exploiting the hacker's work to defraud the telecom companies, officials in the northern city of Brescia said Friday.

The Filipino hacker was part of a group that allegedly penetrated the IT systems belonging to customers of major telephone companies, including AT&T, to steal access codes for international phone calls that he then sold to the group of Italy-based Pakistanis who ran a network of public phone centers. Police declined to identify the hacker by name, saying only that he was a 27-year-old male living in the Philippines.

The Pakistanis offered cut-price calls to their clients by piggy-backing on the PBXs (private branch exchanges) of commercial companies in the United States, Australia and Europe, Italian officials said. The Filipino hacker allegedly sold the access codes that enabled users to take control of the exchanges at US$100 per code, and the codes were then sold on to other users, they said. Some of the illegal profits were allegedly sent to finance the activities of Islamist extremists in Pakistan and Afghanistan, the officials said.

Police identified Zamir Mohammad, 40, the manager of a phone center in Brescia, as the principal buyer of the Filipino's allegedly illegally acquired access codes. Mohammad was responsible for exploiting the codes and selling them on to other telephone service operators in Italy and Spain, police said. On Friday the U.S. Department of Justice unsealed an indictment charging Mahmoud Nusier, 40, Paul Michael Kwan, 27, and Nancy Gomez, 24, all currently residing in the Philippines, with unauthorized computer access and wire fraud. They were arrested on March 10, 2007.

The five Pakistanis arrested in Italy are phone-center manager Mohammad, Shabina, Kanwal, 38, Ahmed Waseem, 40, Zahir Shah, 39, and Iqbal Khurram, 29, the U.S. Department of Justice said.

As well as making the arrests, police seized 10 phone centers Friday in northern and central Italy and raided 16 properties belonging to Pakistani and Moroccan nationals suspected of links to the telephone pirates.

The investigation began in May 2007 following a tip off from the FBI that a group of hackers based in the Philippines had violated the IT security of major international phone companies. The group was allegedly headed by Nusier, a Jordanian, Italian police said.

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