Third-party fraud detection
Prevent stolen identity usage, malicious bots and other forms of fraud at account opening, login and transaction.
69%
of attempted identity misuse involved attempts to open new accounts.
Source: Fend off new account fraud for happier customers (and unhappy criminals), Federal Reserve Financial Services
2x
increase has occurred in application fraud losses in last 10 years.
Source: Fend off new account fraud for happier customers (and unhappy criminals), Federal Reserve Financial Services
39%
of consumers considered abandoning account openings due to friction.
Source: 2025 US Consumer Survey, Experian
Application fraud
Automated, bot-led attacks
Promotion abuse
Scams and coercion
The challenge
Frequent data breaches have made compromised identity data more available to fraudsters than ever. These stolen identities are used to open fraudulent accounts, often at scale using malicious bots and sophisticated attack strategies.
Experian’s approach
Our powerful combination of identity verification data, behavioral analytics, and email and phone intelligence, combined with highly predictive models delivered through a single solution for comprehensive fraud detection.
The challenge
AI-powered bots mimic human behavior and mask device and network data to circumvent traditional bot detection methods. These bots are used to probe fraud defenses for vulnerabilities, open fraudulent accounts, verify stolen credentials and execute other automated, large-scale attacks.
Experian’s approach
Advanced, behavior-based bot detection signals identify advanced bots passively — no manual human verification or liveliness checks required. For cases where AI agents are common, our agent intelligence verifies genuine agents, enabling reliable separation from malicious bots.
The challenge
Interconnected fraudsters identify vulnerabilities in application promotions and share them with others, resulting in quick-scaling attacks. Sophisticated bots enable even faster scalability, negating wins from customer acquisition.
Experian’s approach
Bot detection signals and crowd-level monitoring provide real-time alerts when risky traffic spikes on promotion fields, signaling when fraudsters are targeting a loophole.
The challenge
Though scams often victimize legitimate users (and look similar to first-party fraud), third-party bad actors are pulling the strings. Accurately separating scams from first-party fraud is critical to gaining an accurate view of your organization’s fraud exposure — and stopping fraud before losses happen.
Experian’s approach
Real-time scam detection signals, including call-in-progress and remote-access signals, uncover common scam tactics and reveal abnormalities in user behavior indicative of coercive control.
NeuroID
Reveal stolen identity usage, bots and other forms of third-party fraud across the customer lifecycle with behavioral analytics.
Precise ID®
Identify mismatches in identity data to uncover stolen or synthetic identity data in applications.
AtData
Assess fraud risk at account opening by uncovering newly created, tumbled and high-risk email addresses.
Experian’s training on how to spot patterns and understand which activities had the highest risks blew my team away.
Terrace Finance
Frequently asked questions
Third-party fraud occurs when a fraudster uses another person’s identity, account or credentials to commit fraud, without authorization. It’s commonly associated with identity theft, account takeover, unauthorized transactions and fraudulent applications opened in a victim’s name. Because there’s usually an identifiable victim, third-party fraud is often easier to classify than first-party fraud once the victim reports the activity.
Businesses can achieve third-party fraud detection by using a layered fraud strategy across the customer lifecycle, from account opening to login, transactions and account management. This includes identity verification, device intelligence, behavioral analytics, transaction monitoring, risk-based authentication and fraud scoring. These tools help businesses identify suspicious activity while minimizing friction for legitimate customers.
Third-party fraud is committed by someone using another person’s identity, account or credentials without authorization. First-party fraud is committed by the actual customer, who uses their own identity but misrepresents their information or intent for financial gain. In simple terms, third-party fraud happens to a customer, while first-party fraud is committed by the customer.
Common types of third-party fraud include new account fraud using compromised identity information, account takeover fraud, and unauthorized transactions with stolen credit or debit cards.
During account opening, stolen identity data is used to open accounts or apply for credit in someone else’s name. Warning signs can include identity inconsistencies, high-risk devices and abnormal behavior during the application process.
Yes, third-party fraud can happen after onboarding when fraudsters gain unauthorized access to an existing account through account takeover, phishing, credential stuffing, SIM swaps, malware or social engineering. Once inside, they may change account details, move money, make unauthorized purchases, add payment credentials or exploit account recovery processes.
Third-party fraud can be revealed through a combination of identity, behavioral, device and network signals. Useful indicators include inconsistent or mismatched identity information, unusual login patterns, suspicious device activity and high-risk behavior.
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