It looks like the sender isn't a valid email address in your organization's address book. Check the email address for the ...

It looks like the sender isn't a valid email address in your organization's address book. Check the email address for the Sender: {Sender}, and run the checks again.

If you entered the correct email address, you need to either create a mailbox for that user or create an external email address for them.
  1. In the Office 365 Admin center, go to the Active users page.
  2. Choose Add a user.
  3. Provide the requested information, and a mailbox is created automatically for the new user.