Symptoms

My users shows up in duplicate in people pickers and people pickers cannot resolve it.
There is only one of me in the SharePoint profiles, as well as the site's user page - _catalogs/users/simple.aspx.

Where is this user coming from?

 

Diagnoses

In this particular case two different account types existed for the user in question in AAD(this explains where the duplicate user is coming from) and there is no way to distinguish between synced or in-cloud account profiles when searching for users via Picker control in SmartForms.

Azure Active directory uses Graph API and Graph API doesn’t have the ability to return the “Status” of an account from Azure, there might be some different way to get the “Status” but it will require deep investigation into Azure's API if at all possible.

It's important to note that the same thing happens with same account types with different email and same “Name” context.

 

Resolution

As a workaround, change the underlying SmartObject binding on the People Picker control to use the “Azure Active Directory – User” SmartObject instead of the default "SharePoint Integration People Picker Source " SmartObject. The "Get List" method for the Azure AD SmartObject has the UPN property which, as you know, is a unique value.

In the configuration for the Picker control concatenate the “UPN” name to the “DisplayName” property like so:

mDisplayName] lUserPrincipalName]]

This way you are able to distinguish between the two accounts using the email context.
Here’s a quick video walkthrough with detailed steps for reference: http://screencast.com/t/zqnblaWrdH

This has been log as a feature enhancement and linked to a TFS item for traceability.