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I am in a process of enforcing more strict VPN access policy after learning about the attack on PPTP with MSCHAP v2. Basically this I will be disabling the traditional PPP authentication methods and using an EAP method instead.

Windows provides quite a range of EAPs, among them EAP-MSCHAP v2. Am I correct to understand that this is just the old MSCHAP v2 done in the EAP format without any additional protection? In other words, it must be used within PEAP (or similar) to defeat the attack, right?

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up vote 3 down vote accepted

If you are using PEAPv0 with EAP-MSCHAPv2 authentication then you should be secure as the MSCHAPv2 messages are sent through a TLS protected tunnel. If you would not use a protected tunnel, then you are indeed vulnerable.

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