SMTP error code 546 occurs when an email bounces between two or more recipients. This typical email hosting issue happens when a user from an organization gets created as a contact on a different organization. In this instance, the user will have the same email address. Once an email reaches one of these users, the email gets sent back and forth through the email system.
It can also happen due to incorrectly configured email forward rules.
To resolve this error, verify that none of the users within the email recipients have the same contact within a different organization where they share the same email address. If this is the case, you may remove one of the email addresses or the contact from the organization.
If no users share the same email address, the next option is to look at forwarding rules related to the recipients that face this issue. It is crucial to check if there are forwarding rules that may cause a loop.
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