Solution:
Root Cause: Windows Hello NGC Container ACL Desynchronization
When Windows updates complete feature upgrades or servicing stack updates, the Security Account Manager (SAM) and the CNG Key Isolation service (
KeyIso) negotiate updated asymmetric key handles stored inside
C:\Windows\ServiceProfiles\LocalService\AppData\Local\Microsoft\NGC. If the update process alters default ACL permissions on the
NGC system directory,
lsass.exe is denied read access to the encrypted key blob, resulting in internal CNG error
0x8009002d (
NTE_INTERNAL_ERROR).
Diagnostic Verification:
1Boot into Windows using an alternative sign-in method (Password, Picture Password, or Safe Mode).
2Open Command Prompt as Administrator.
3Query the Event Viewer security and operational logs for Windows Hello:
wevtutil qe Microsoft-Windows-User Device Registration/Admin /f:text /c:5
4Search for entries citing NGC key container decryption failed or Error 0x8009002d.
Step-by-Step Fix:
1Boot into Safe Mode or Open Administrative Command Prompt:
If locked out of Windows entirely, hold Shift while clicking Restart at the sign-in screen -> Troubleshoot -> Advanced options -> Startup Settings -> Restart -> Select 4 for Safe Mode.2Take Ownership of the NGC System Directory:
Execute the following commands in administrative Command Prompt: takeown /f C:\Windows\ServiceProfiles\LocalService\AppData\Local\Microsoft\NGC /r /d y
icacls C:\Windows\ServiceProfiles\LocalService\AppData\Local\Microsoft\NGC /grant administrators:F /t
3Delete All Cached Key Containers inside NGC:
Purge the contents of the directory: del /f /s /q C:\Windows\ServiceProfiles\LocalService\AppData\Local\Microsoft\NGC\*
rd /s /q C:\Windows\ServiceProfiles\LocalService\AppData\Local\Microsoft\NGC
Re-create the empty root container: mkdir C:\Windows\ServiceProfiles\LocalService\AppData\Local\Microsoft\NGC
4Re-establish System ACL Permissions:
Restore default security descriptors: icacls C:\Windows\ServiceProfiles\LocalService\AppData\Local\Microsoft\NGC /grant "NT SERVICE\LocalService":(OI)(CI)(F) /t
5Reboot and Provision Fresh PIN:
Restart the PC (shutdown /r /t 0). Navigate to Settings > Accounts > Sign-in options > PIN (Windows Hello) and click Set up.Prevention & Long-Term Monitoring:
Exclude C:\Windows\ServiceProfiles\LocalService\AppData\Local\Microsoft\NGC from third-party disk cleanup utilities and aggressive endpoint backup tools.