AFNetworking incorrectly interpreted WP_Error error

I have client code that communicates with the server to create an account. The communication works, but the error response is not received correctly. In the Objective-C code below, I use AFNetworking to send the request. I purposely sent an invalid email address and expected the failure block to get executed, but my code kept going into the success block.

- (void)createAccount:(NSString *)email
          andUsername:(NSString *)username
          andPassword:(NSString *)password
              success:(SuccessBlock)success
              failure:(FailureBlock)failure
{


    NSDictionary *params = @{
                             @"email": email,
                             @"username" : username,
                             @"password" : password,
                             @"client_id" : @"12345"
                             @"client_secret" : @"abcdef"
                             };

    NSString *requestUrl = [self pathForEndpoint:@"users/new"
                                     withVersion:ServiceRemoteRESTApibbPressExtVersion_1_0];


    [self.api POST:requestUrl parameters:params
           success:^(AFHTTPRequestOperation *operation, id responseObject) {
               success(responseObject); // WENT IN THIS PATH
           }
           failure:^(AFHTTPRequestOperation *operation, NSError *error){

               failure(error); // EXPECTS THIS PATH
           }
     ];
}

On the server side, my PHP scripts is coded as follow. I did check the debug.log and saw the printed message: *** users_new_REST_API() email invalid

add_action( 'rest_api_init', function () {
            register_rest_route( 'bbpress_ext/v1', '/users/new', array(
                'methods' => 'POST',
                'callback' => 'users_new_REST_API'
            ) );
        } );

public function users_new_REST_API( $request ) {
        $user_name = $request['username'];
        $password = $request['password'];
        $user_email = $request['email'];
        $client_id = $request['client_id'];
        $client_secret = $request['client_secret'];

        if ( ! is_email( $user_email ) ) {
            error_log('*** users_new_REST_API() email invalid');
            return new WP_Error('email_invalid', 'Invalid email entered.', array( 'status' => 524) );   
        }
}

I can’t tell if AFNetworking is misbehaving or the REST-API (beta version 2) for WordPress is broken.