Small Talk That Foils Phone Crooks

TELECOMMUNICATIONS INDUStry analysts estimate that nearly $1 billion will be lost to calling-card fraud this year. Most crooks just eavesdrop or watch carefully at public telephones, sometimes with binoculars, to steal the numbers of unsuspecting strangers. But Preferred Telecom Inc. has a high-tech system to thwart such low-tech "shoulder surfing."

The Dallas-based long-distance carrier has introduced a calling-card service that verifies callers' identities by analyzing the sounds of their voices. It uses technology developed by nearby Voice Control Systems Inc. Customers must first register their "voice print" with Preferred's computer by dialing a toll-free number. At the same time, they store one-word responses to questions such as "What is your mother's maiden name?" After that, all access to Preferred's national and international phone lines requires customers to speak their five-digit account number and password for verification. Tom S. Hunse, vice-president for business development and investor relations, says the system has shown a 93% accuracy rate. To help verify the other 7%, the system resorts to additional questions answered during enrollment. Preferred is talking with other carriers about licensing the technology for use with their services.

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