Is there a away to block incoming email addresses that don't have an mailbox? All emails are being sent to the administrators mailbox with an error message "Notification: Inbound Mail Failure".
The Exchange system sends an undeliverable report to the originator to say that the email address doesn't exists, which is a good thing. If you don't want your administrator mailbox getting filled with those 'Inbound mail failure' reports then you can switch them off in Exchange Admin by going into Configuration, then into Connections and opening up the Internet Information Service, then go to the 'Internet Mail' tab and click the 'Notifications' button. Deselect the 'E-mail address could not be found' option.
I have done test and sent email message to serveral of the x employee email address but I do not get a message saying their email accounts do not exsits. Is this a settings issue?
I'm not sure whats happening. If you send an email to an address which doesn't exists you should get a message saying this. In the address name@company.com, if the 'company' is misspelt, or their server is down for long enough you will get a reply after 1-3 days (depending on the priority of the email), if the 'name' is misspelt you should get a reply within seconds. Looking at the microsoft site, the occasional problems with not getting a Non Delivery Report seems to be due to using Exchange5, or using X.400 addresses.
Sorry, I've not come across undeliverable reports not being sent to the originator.
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