Passwordless does not display errors in New Universal Login


I have custom Pre User Registration action which denies user registration in some cases:

 api.access.deny('user_not_exists', `User ${} is not an active in the community`);

When I use passwordless login in my New Universal login Auth0 redirects me to /u/login/passwordless-email-challenge page asking to enter code from email even though pre-registration action returned an error (I see Failed Signup error in Logs section).

My assumption was that if pre-registration action for passwordless fails:

  1. Auth0 does not send an email (this part is working, email with the code is not being sent)
  2. Auth0 displays an error returned from the action

What might be wrong here and how do I display an error instead of a code prompt if action fails?