There were two specific events that gave Padan Fain his
considerable power. The first time he was changed, it was done by
the hand of the Dark One himself. The Dark One was still searching
for the Two Rivers boys at the time, and when he realized that Fain
had contact with the boys, he took Fain to Shayol Ghul, broke him,
distilled his knowledge of Perrin, Mat, and Rand in particular, and
reformed him with the ability and irresistible compulsion to find
them. This also gave Fain an undying hatred of the Dark One and
Rand.
The next event took place when Fain followed Rand and Co. into
Shadar Logoth, where he meet with Mordeth, an evil being who also
had a hatred for the Shadow. Mordeth tried to take over the body of
Fain, but due to the touch of the Dark One he could not succeed and
was absorbed by Fain, and the two entities merged into one. This
bequeathed Fain with the ability to kill with a touch, amongst
other things, and to strike fear into the hearts of other
creatures, particularly those of the Shadow.
Without the first event, it is likely that the merging with
Mordeth would have resulted in Fain's death. It is the uneasy
merger of the two opposing powers within him that give him powers
on an unprecedented level. His dual nature is also the main reason
for his madness, which makes him very unpredictable in the use of
his power.