.Net's Directory Services throws a strange exception

I have a small C# solution used to check users credentials. It works fine for two of my teammates, but on my PC I get an exception.

The relevant code:

PrincipalContext context = new PrincipalContext(ContextType.Domain);
if (context.ValidateCredentials(System.Environment.UserDomainName + "\\" + usr, pwd))
     return true;
else
     return false;

And the exception is:

DirectoryOperationException, "The server cannot handle directory requests.".

I tried creating context with the explicit server name and the 636 port number, but this didn't help as well.

Any ideas?