Every since the Cellular industry come about, it has been a booming business. The industry average revenue is over 20 billion dollars a year. That is 20 billion dollars in America alone. As years pass, everyone knows that the Cellular phone industry is only getting bigger and better due to high demand, cheaper phones, and cheaper contracts. With an industry that is so large and making so much money, there is more chance for fraud. Hackers, with cellular phone security change constantly, are daily trying to find a new way to make a free call, or just trying to beat the system for personal challenge. Surprisingly enough, violators who are caught don"t face a real stern penalty for ripping off companies for thousands of dollars. The chances of getting prosecuted for a single violation is unlikely, but if you repeat violator the penalty can be sever. So why not try to find a way to make a free call if the penalty isn"t very harmful? As of 1999 there have been a little over 1000 people arrested and tried for cellular fraud, most with multiple counts. Experts say that over 800 thousand dollars each day are lost due to cellular fraud. Even more surprisingly though, each year 600 million dollars are lost; which is approx 2.5% of the total revenues of the cellular industry. .

             First, I"m going to take a step back to when the original phone was first hacked. Telephone fraud/Phone Hacking ("Phreaking") has been around since the time phones were invented. Telephone fraud is defined as illegally using the communication facilities of telephone companies. One of the first phone frauds was finding a way to make free long distance phone calls. One of the first phone frauds was Electronic Toll Fraud.

             The ETF's are electrical devices used to get free long-distance calls. The devices are more commonly known as colored boxes, and using them is known as "boxing." Boxing is one of the oldest ways to phreak, and therefore, it is also the most dangerous, since the telephone companies are very much aware of their existence.