To fix the L2TP security layer processing error, open ncpa.cpl, right-click your VPN connection, and under the Security tab enable MS-CHAP v2.
L2TP relies on the Point-to-Point Protocol (PPP) to negotiate authentication before data flows.
Enable both — they address different stages of the same negotiation, and turning on just one sometimes isn't enough.
Understanding the sequence makes this error far less mysterious.
People burn hours on this because they fix the wrong layer.
Read the complete breakdown, fixes and what happens next.