Today we have faced with interesting issue. When tried to use Connect-SPOService cmdlet on one tenant we got the following error:
The sign-in name or password does not match one in the Microsoft account system
Interesting that on other tenants this cmdlet worked properly. Troubleshooting and searching showed that one of the reason of this error can be enabled MFA (more specifically, when Connect-SPOService is used with -Credentials param). However we double checked that for those accounts for which this error was shown MFA was disabled.
Then we tried to login to O365 site with this account in browser and my attention was attracted by the following message which was shown after successful login:
Microsoft has enabled security defaults to keep your account secure:
As it turned out on this tenant AAD Security defaults were enabled which forced MFA for all users. In turn it caused mentioned error with Connect-SPOService. Solution was to disable security defaults in AAD properties:
After that error disappeared and we were able to use SPO cmdlets.
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