iPhone not accepting new network password for Exchange (ActiveSync)

A little background...

We are using Maas360 MDM for managing our iPhones in our corporate environment. We are using Exchange 2010 with Load Balanced CAS servers on the front end. We are using Active Directory to manage our User Accounts.

Problem...

When a user's network password expires and they change to a new network password, Maas360's profile installed on the phone presents a pop-up box for the user to change their "Exchange" password. "Exchange" in this case is the name of the mail profile installed on the phone. When the user attempts to enter their new password, it keeps telling them that the password is incorrect. However, we are testing the password in OWA and the password is indeed working. I have entered the password myself, so I know there is no typo from the user.

Now, if we go into Settings - Mail, Contacts, Calendars and manually change the password it accepts it just fine.

I have spoken with support at Fiber Link (Maas360 developers) and they insist that this is not a problem with their product, that they product has nothing to do with the actual connection to ActiveSync but only manages the profile sent to the device. They feel that there might be some issue with the wrong HTTP return code being sent (HTTP 403 instead of HTTP 500).

Anyway, I am going to also work with Microsoft to see if this is an issue with the CAS front end servers, but wanted to post this in this forum in case anyone else has experienced this issue and has resolved it.

Any assistance would be welcomed.

Thanks.