I went deep on troubleshooting. I was able to narrow it down to the camera switches that happen for first person that cause the issue. We use multiple fixed point cameras for this. It seems that if you stack more than 2 active cameras (i.e. add the same player to multiple cameras but don’t remove them), this bug occurs. For example, if I add the player to one camera, then another and then another without first removing the player from the previous cameras, the bug occurs. With two stacked cameras, the issue did not occur.
To fix it, I explicitly remove the player from the previous camera before adding them to the next one.