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Using the SYSKEY utility to encrypt the contents of the SAM Accounts Database

Syskey.exe is a tool available in Windows Server 2003 ,Windows 2000 and XP to encrypt the contents of the SAM Accounts Database.

Windows 2000,2003,XP requires the encryption of password hashes when those are stored on the machine. the encryption key is stored locally on the machine and it randomly generated by the system.
Syskey.exe enables you to move the key out of the machine by storing it on a floppy disk or by asking a startup password.(more)

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