Third-party fraud

Third-party fraud involves identity theft, where the victim is unaware. Second-party fraud involves the victim willingly sharing their information or account access, often as a favor or in exchange for compensation.

Examples include fraudulent loan applications using stolen IDs, unauthorized credit card use, or synthetic identities created from multiple real victims’ data. It is often the foundation of financial and cybercrime.

It's difficult to detect because the identity used often appears legitimate. Detection systems struggle to differentiate between real users and skilled impostors, especially when data is accurate but stolen.