Client authentification failure while sending email from office365 account via powershell

The regular way to do this when using modern authentication with MFA would be to allow ‘app passwords’. There are other ways, which I would not recommend, because they potentially lower the security posture.

https://docs.microsoft.com/en-us/azure/active-directory/user-help/multi-factor-authentication-end-user-app-passwords

If that doesn't work or is not allowed in your tenant, other methods may include:

* Disabling MFA (not recommended)

* If MFA is enabled using Azure AD Conditional Access, exclude this user for specifically SMTP from the Azure AD Conditional Access policy

* If you're using Security Defaults within your Microsoft 365 tenant, legacy authentication is blocked by default and can't be bypassed unless you disable Security Defaults

* You can use the Graph API for sending out e-mail programatically (Send mail - Microsoft Graph v1.0 | Microsoft Docs)