unable to authenticate via a c5400 when using PPP connection

I'm trying to configure DialOut/IP utility to make an outbound DUN
connection to a remote site.
If you telnet to the 5400 on port 7001 you are able to dial out fine,
but it's as though I don't get authenticated on the 5400 when I to
connect with DUN.

very cut down version of the config is (if you need more, please ask);
!
aaa authentication login modemaccess local group tacacs+ none
aaa authentication ppp ppptac local group tacacs+ none
!
interface Serial7/0:15
no ip address
encapsulation ppp
dialer rotary-group 1
dialer-group 1
isdn switch-type primary-net5
isdn incoming-voice modem
isdn calling-number xxxx
no fair-queue
no cdp enable
ppp authentication chap pap callin
!
interface Group-Async0
ip unnumbered FastEthernet0/0
no ip mroute-cache
dialer in-band
dialer idle-timeout 900
dialer rotary-group 1
async mode interactive
peer default ip address pool pool_dialup
ppp authentication chap pap callin
group-range 1/00 1/107
!
line 1/00 1/107
exec-timeout 0 0
privilege level 0
no flush-at-activation
script activation dialstart
no vacant-message
login authentication modemaccess
no modem InOut
rotary 1
transport input all
autoselect during-login
autoselect ppp
!
GW-DIAL1#show debug
General OS:
AAA Authentication debugging is on
AAA Authorization debugging is on
PPP:
PPP authentication debugging is on
PPP protocol errors debugging is on
PPP protocol negotiation debugging is on

I try to connect and get the following output...
Jan 30 17:38:33.972 gmt: AAA/BIND(00000381): Bind i/f Async1/05
Jan 30 17:38:33.972 gmt: AAA/AUTHEN/LOGIN (00000381): Pick method list
'modemaccess'
Jan 30 17:38:34.532 gmt: AAA/AUTHOR (00000381): Method list id=0 not
configured. Skip author
Jan 30 17:38:52.081 gmt: AAA/BIND(00000382): Bind i/f Async1/05
Jan 30 17:38:52.081 gmt: AAA/AUTHEN/LOGIN (00000382): Pick method list
'modemaccess'
Jan 30 17:38:52.497 gmt: AAA/AUTHOR (00000382): Method list id=0 not
configured. Skip author

Output from the DialOut/IP trace...
11:47:00.667 COM7 : | Open
11:47:00.667 COM7 : | Current UART Settings:
11:47:00.667 COM7 : | Baud: 00115200
11:47:00.667 COM7 : | Framing: 08,N,1
11:47:00.667 COM7 : | RTSFlow: 1 CTSFlow: 1
11:47:00.667 COM7 : | DTR: 1 RTS: 0 CTS: 1 DSR: 1 CD: 0
11:47:00.667 COM7 : | CTS: 1 DSR: 1 CD: 0
11:47:00.667 COM7 : | Port open
11:47:00.667 COM7 : | CTS: 1 DSR: 1 CD: 0
11:47:00.667 COM7 : | Enable Telnet
11:47:00.667 COM7 : | Disable Telnet CR-padding
11:47:00.667 COM7 : | Enable DTR emulation (Unimodem)
11:47:00.667 COM7 : | Disable DCD emulation (pcAnywhere)
11:47:00.667 COM7 : | Enable user authentication
11:47:00.667 COM7 : | Connecting to server gw-dial1[7001]
11:47:00.667 COM7 : | Baud: 00009600
11:47:00.667 COM7 : | Framing: 07,E,1
11:47:00.667 COM7 : | Baud: 00115200
11:47:00.667 COM7 : | Framing: 08,N,1
11:47:00.667 COM7 : | DTR: 1
11:47:00.667 COM7 : | FlushTX
11:47:00.667 COM7 : | FlushRX
11:47:00.667 COM7 : | FlushRX
11:47:00.667 COM7 : | DTR: 1
11:47:00.714 COM7 : | Waiting to authenticate to server
11:47:00.808 COM7 : | Sent username to server
11:47:00.808 COM7 : | COM Port Control negotiated (RFC-2217)
11:47:01.059 COM7 : | Sent password to server
11:47:01.575 COM7 : » AT^M
11:47:01.590 COM7 : « AT^M
11:47:02.560 COM7 : | Site auth failed
11:47:02.685 COM7 : | FlushTX
11:47:02.685 COM7 : | DTR: 1
11:47:02.701 COM7 : » AT^M
11:47:04.704 COM7 : | FlushTX
11:47:04.704 COM7 : | DTR: 1
11:47:04.704 COM7 : » AT^M
11:47:06.706 COM7 : | FlushTX
11:47:06.706 COM7 : | DTR: 1
11:47:06.722 COM7 : » AT^M
11:47:08.724 COM7 : | FlushTX
11:47:08.724 COM7 : | DTR: 1
11:47:08.740 COM7 : » AT^M
11:47:10.742 COM7 : | FlushTX
11:47:10.742 COM7 : | DTR: 1
11:47:10.742 COM7 : » AT^M
11:47:12.745 COM7 : | FlushTX
11:47:12.745 COM7 : | DTR: 1
11:47:12.760 COM7 : » AT^M
11:47:14.763 COM7 : | FlushTX
11:47:14.763 COM7 : | DTR: 1
11:47:14.778 COM7 : » AT^M
11:47:16.781 COM7 : | FlushTX
11:47:16.781 COM7 : | DTR: 1
11:47:16.796 COM7 : » AT^M
11:47:18.799 COM7 : | FlushTX
11:47:18.799 COM7 : | FlushTX
11:47:18.799 COM7 : | FlushRX
11:47:18.799 COM7 : | FlushTX
11:47:18.799 COM7 : | FlushRX

Any help would be appreciated.

Regards
Dave