Freeradius, OpenLDAP, CHAP and MD5 passwords

[Carlos Pratas]

We have usernames and passwords stored in an OpenLDAP server with MD5 passwords. Freeradius 0.8 authenticating with PAP works fine. With CHAP the radius daemon reports that password should be stored in clear text and rejects the access, but the FAQ “5.11 How do I make CHAP work with LDAP” suggests I can use encrypted passwords. Is this interpretation correct? If so, what can be wrong?   Thanks in advance for any help.   Best regards,     C. Pratas