Equifax launches product to detect first-party fraud
Equifax has launched a new machine learning product designed to combat two forms of first-party fraud: loan piling and credit cleansing.
The new credit abuse risk model uses behavioral insights and Fair Credit Reporting Act (FCRA) data to detect these activities during prequalification, account origination or portfolio review so that lenders can modify loan terms based on FCRA complaint insights, the company said in a press release on Friday (Jan. 30).
Loan stacking is a form of fraud in which an individual applies for multiple loans quickly with no intention of repaying them, according to the release. Credit cleansing is when a person attempts to remove accurate but negative information from a credit report.
The credit abuse risk model identifies atypical credit behavior, enables targeted decision-making without limiting consumer protections, provides insights across all credit levels, and provides scoring that complies with FCRA-mandated adverse behavior reason codes, the release said.
The model works in conjunction with Equifax's comprehensive identity risk tool to provide lenders with a complete view of identity legitimacy and repayment risk, according to a press release.
“By focusing on application behavior in real time, Credit Abuse Risk can quickly help reduce the likelihood of fraud and associated costs,” Felipe Castillo, chief product officer for U.S. Information Solutions at Equifax, said in a press release. “This supports a more confident lending environment and helps make credit available to consumers.”
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Equifax launched its synthetic identity risk product on Jan. 23, saying it uses artificial intelligence (AI) to detect and help prevent synthetic identity fraud, a rapidly growing threat in which scammers create fictitious identities and use them to open credit accounts or obtain loans. Comprehensive Identity Risk can be used at account opening or on an ongoing basis as an account management tool.
Equifax said in October 2025 that it was preparing to launch new fraud prevention tools, including synthetic identity models and first-party fraud models.
“Fraud continues to be one of the most significant and rapidly evolving threats facing our customers,” Equifax CEO Mark Begor said on an Oct. 21 earnings call. “We are leveraging new advanced artificial intelligence capabilities and unique data assets to deliver a new generation of fraud prevention tools that identify risks invisible to traditional methods.”
PYMNTS reported in March 2024 that first-party fraud increasingly requires payment networks as the first line of defense, and these networks are using data and artificial intelligence to uncover fraudulent disputes in transactions.
