Adding a delegated directory fails with MS AD on Configuration page

Steps to produce error:

1. Add a delegated directory
2. Fill the first tab
3. Enter Connector details (leave all fields in default), enter connection details and test. Successful. Push update.
4. In the Configuration tab do the test with default values, successful. Push update

Error message:
There was an error in updating the directory. Please check the fields to ensure all entries are valid.