FTPS, 550 Requested action not take

With the help of proftpd support forums, I figured this one.

UIDs and GUIDs in AuthUserFile must match one(s) of real Linux user(s) with the right ownership/permissions for the relevant FTP directories.

That is working as intended. If you want to set a password using the useradd command, you are supposed to give a hashed version of the password to useradd.

The string pass does satisfy the format criteria for the hashed password field in /etc/shadow, but no actual password hashes to that string. The result is that for all intents and purposes, that account will behave as having a password, but any password you try to use to access it will be rejected as not being the correct password.

See man useradd or the useradd documentation:

-p, --password PASSWORD

The encrypted password, as returned by crypt(3). The default is to disable the password.

Note: This option is not recommended because the password (or encrypted password) will be visible by users listing the processes.

You should make sure the password respects the system's password policy.