Microsoft Dynamics CRM Outlook Client fails to configure if you are using App Passwords for authentication

If you view the error details, the following stack trace appears:


The remote server returned an error: (400) Bad Request.   

at System.Net.HttpWebRequest.GetResponse()

   at Microsoft.Crm.Outlook.ClientAuth.ClaimsBasedAuthProvider`1.MakeHttpPostRequest(Uri postUri, String postData)

  at Microsoft.Crm.Outlook.ClientAuth.PassportAuthProvider`1.SignIn()

   at Microsoft.Crm.Outlook.ClientAuth.ClientAuthProvidersFactory`1.SignIn(Uri endPoint, Credential credentials, AuthUIMode uiMode, IClientOrganizationContext context, Form parentWindow, Boolean retryOnError)

   at Microsoft.Crm.Outlook.ClientAuth.ClientAuthProvidersFactory`1.GetAuthProvider(Uri endPoint, Credential credentials, AuthUIMode uiMode, Uri webEndPoint, IClientOrganizationContext context, Form parentWindow)

   at Microsoft.Crm.Application.Outlook.Config.ServerInfo.LoadUserId()

   at Microsoft.Crm.Application.Outlook.Config.ServerInfo.Initialize(Uri discoveryUri, OrganizationDetail selectedOrg, String displayName, Boolean isPrimary)

   at Microsoft.Crm.Application.Outlook.Config.ServerForm.LoadDataToServerInfo()

   at Microsoft.Crm.Application.Outlook.Config.ServerForm.<InitializeBackgroundWorkers>b__2(Object sender, DoWorkEventArgs e)

   at System.ComponentModel.BackgroundWorker.OnDoWork(DoWorkEventArgs e)

   at System.ComponentModel.BackgroundWorker.WorkerThreadStart(Object argument)


For more information on the App Passwords feature available with Multi-Factor authentication, refer to the following articles:

Multi-Factor Authentication for Office 365
http://technet.microsoft.com/en-us/library/dn383636.aspx

Managing your Microsoft Azure Multi-Factor Authentication User Settings
http://technet.microsoft.com/en-us/library/dn270518.aspx