[Resolved] XRMToolbox - An unsecured or incorrectly secured fault was received from the other party. See the inner FaultException for the fault code and detail.

To keep this post short and simple.

Trial instance which I created has MFA has been enabled and while we are using the old method of login into XRMToolbox via Connection wizard, we are getting below error, as there is no possibility of a second level of authentication via Mobile.

Below is stack trace and error encountered:

Error	: An unsecured or incorrectly secured fault was received from the other party. See the inner FaultException for the fault code and detail.
Stack Trace	: Server stack trace: 
   at System.ServiceModel.Channels.SecurityChannelFactory`1.SecurityRequestChannel.ProcessReply(Message reply, SecurityProtocolCorrelationState correlationState, TimeSpan timeout)
   at System.ServiceModel.Channels.SecurityChannelFactory`1.SecurityRequestChannel.Request(Message message, TimeSpan timeout)
   at System.ServiceModel.Dispatcher.RequestChannelBinder.Request(Message message, TimeSpan timeout)
   at System.ServiceModel.Channels.ServiceChannel.Call(String action, Boolean oneway, ProxyOperationRuntime operation, Object[] ins, Object[] outs, TimeSpan timeout)
   at System.ServiceModel.Channels.ServiceChannelProxy.InvokeService(IMethodCallMessage methodCall, ProxyOperationRuntime operation)
   at System.ServiceModel.Channels.ServiceChannelProxy.Invoke(IMessage message)

Resolution:

While Connecting to XRM Toolbox use OAuth/MFA option rather than 'Connection wizard' you will get through the MFA and successfully establish connection

Step 1: Click on 'OAuth/MFA'

Step 2: Provide the environment details

Step 3: Enter the email address and click on the 'use development Azure AD App' you will get the first two text boxes auto-populated with development settings. then click on Next

Step 4: Here It will send an SMS to your registered mobile number, once you validated that you connection would be established.

Hope this helps someone.