create user failure - This implementation is not part of the Windows Platform FIPS validated cryptographic algorithms

I am using a Powershell script to create IIS user. Here is the line that creates a user -

[void][Microsoft.Web.Management.Server.ManagementAuthentication]::CreateUser($user, $user_passwd)

But I got an error mesage saying this is not FIPS validated cryptographic algorithm. I guess it is related to registry setting

HKLM\System\CurrentControlSet\Control\Lsa\FIPSAlgorithmPolicy\Enabled.

So I set it to 0, but it did not help. I tried reboot my Windows 2008 R2 SP1 server as well. Can anyone help?

Exception calling "CreateUser" with "2" argument(s): "This implementation is not part of the Windows Platform FIPS vali
dated cryptographic algorithms."
At D:\bin\add-user.ps1:306 char:77
+ [void][Microsoft.Web.Management.Server.ManagementAuthentication]::CreateUser <<<< ($agency_msp_user, $agency_msp_user
_passwd)
    + CategoryInfo          : NotSpecified: (:) [], MethodInvocationException
    + FullyQualifiedErrorId : DotNetMethodTargetInvocation

Thanks.