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IIS hosted Web service using an AX wcf service: The Target principle name is incorrect

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I'm a bit new to IIS hosted wcf services and I'm having some problems I can't resolve.

I have a wcf web service hosted on ISS that makes a call to a custom AX service.

I have tested the AX service through a C# console app and it works perfectly. But when I use it with the wcf service is appears to fail.

Using the wcf test client to test my service I get an A call to SSPI failed exception with the inner exception being "The Target principle name is incorrect"

I have set the wcf service on IIS to use the business connector process. It is in fact the only user that appears to work. Before making this change I was getting a failed to login to Dynamics AX error.

I have also tried various setting with the config file to change the end point Identity setting both the user principal name and the service principal name but that either has no effect or the wcf test client throws an exception.
I have also created an C# console app to make a call to the wcf service on IIS, but it this case it returns nothing, not even an error message.

What configuration do I need to have for this to work?


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