SMTP auth fails with '550 5.7.1 client does not have permissions to send as this sender'

In some cases where SMTP AUTH commands are sent to the downstream mail server, Email security will fail if configured to use MTA mode and the recipient mailserver (Exchange) is not utilizing the option Manage Send as permission for the mailbox in question. In most cases, this will pertain to the outbound mailflow as rarely would SMTP Auth be enabled for inbound. With that being said, the caveat is not path specific and is a general consideration when facing SMTP AUTH and an Exchange facing recipient path.

Version Applicable:  8.3

This is a configuration issue with the downstream Microsoft Exchange server.

1. Open the Exchange Management Console.
2. In the console tree, click Recipient Configuration.
3. In the result pane, select a recipient. 
4. In the action pane, click Manage Send As Permission (or right-click Properties on the recipient).
   
   
   
5. On the Manage Send As Permission page, select the users or groups to which you want to grant the Send As permission.
   
6. Click  Add button to open the select User or Group dialog box. Use this dialog box to select the users or groups to which you want to grant the Send As permission.
7. On the Completion page, review the following, and then click Finish to close the wizard:
8. A status of Completed indicates that the wizard completed the task successfully.
9. A status of Failed indicates that the task wasn't completed. If the task fails, review the summary for an explanation, and then click Back to make any configuration changes.
10. Click Finish close the wizard.