Sorry false alarm, I have got this working. The instructions at
https://one.ubuntu.com/help/faq/what-should-i-do-if-authentication-
fails-auth_failed-state/ should state that the application seahorse
should be opened first and then navigate to preferences etc. Not at the
end of the first point in paretheses. It would make it easier for the
not so quick witted like myself.

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https://bugs.launchpad.net/bugs/1278190

Title:
  File sync error. (auth failed(AUTH_FAILED))

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