With SEP 14.3 RU9 for Mac Client, Bluetooth was added to Device Control. Mac Clients must allow SEP to access Bluetooth on their Mac device. If they do not, the client will report "Malfunctioning (Device Control)" to the cloud. macOS 12 and macOS 13 will block Bluetooth without being granted permission.
This is an Apple fault that was rectified in macOS 14 (Sonoma)
During setup SEP needs access to Bluetooth. Upgrading the macOS to 14 (Sonoma) will correctly unblock Bluetooth protection in Device Control if the permission has not been granted.