Hii,
I have this issue for a long time, searched for everywhere and no answer, so here is my problem:

I have a freeradius running side by a mikrotik server, all work fine, but, if i set pppoe to support chap, ms-chap auth, the client can connect, radius server do the job, but the client can get any traffic, when i disable all and leave only pap, all run fine.. so anyone with this problem? How can i fix this?

thanks for the help!

Try enabling encryption. It seems hokey, but think I have had it happen where a link authenticafted with mschap cant work unless encryption is enabled.

Have you run FreeRADIUS in debug mode? From a shell on the server, stop the radius service, then:
radiusd -X

You get to see the entire transaction on the RADIUS server side.

Also check the log on the MT router. There should be some message there if login didn't go smooth. In the hotspot, http-chap requires the password to be md5 encrypted with a challenge sent by the router, done by a javascript routine immediately after clicking the "login" button.

thanks for the reply!

I tryed encryption but no sucesss.. in the freeradius debug.. i can see all normal.. the authentication runs nicely, but the user cant get any trafic! But when i set mschap with no mppe.. all works.. for a time..