Atlassian Account ID does not work with JIRA REST API - Basic authentication

Summary

When an instance has Atlassian Account SSO enabled, JIRA REST API - Basic authentication is not working

Environment

JIRA Cloud Version 1000.482.3

Steps to Reproduce

1. Enable SSO to an instance
2. Add a new user that already has Atlassian Account ID
3. Use your Atlassian Account id to run JIRA REST API - Basic authentication

Expected Results

• It should REST clients to authenticate using the Atlassian Account ID and password

Actual Results

• Getting 401 Unauthorized error

Note

• It's only not working for new users that was not able to set a password in the instance before.