Very specific issue:
Small Business Server 2003 with Exchange 2003, connected to Verizon FiOS. Virtual SMTP server is configured to send all outbound messages through Verizon's SMTP server, and the required Verizon username and password are entered and appear to be working.
In addition to hosted mailboxes on the Exchange server, I also have several contacts that redirect e-mail to Verizon.net mailboxes. These also seem to be operating just fine, except when the sender is a verizon.net address, in which case an NDR is sent back to the sender stating "550 5.7.1 Authentication is required to send mail as <email@example.com>".
This only occurs when the sender is a verizon.net address. All other internet senders' e-mail is relayed and delivered without issue.
Can anyone provide any insight as to what may be causing this?