Passwordless auth ERROR_USER_SEARCH_NO_EMAIL

We are attempting to implement passwordless auth for users who have been signed up to our service. We create the user using an sms connection via REST API’s. When the user tries to login using passwordless auth with a one time passcode the top is sent correctly however when the user enters the code to verify and we attempt to login to AuthO with phone number and OTP we get the following error;

ERROR_USER_SEARCH_NO_EMAIL [get-or-create-sso-user] Cannot search for user without email or with invalid email

We have tried this using both iOS and Android native SDK’s so believe it is more likely a configuration issue.

Other things to consider is we have disabled signups as the users should only be registered by a management console.