DPM Error ID 3123

Failed to update permissions used for end-user recovery on FILE-SRV.xxx.local. Permissions update failed for the following reason: (ID: 3123)

This issue took a while to find a solution for, but it worked for me.
Open Server Manager on the DPM server and expand Roles, File Services, Share and Storage Management.
Remove any shares with the \\?\C :\ in the Local path if they are preceeded with a red X. (DPM will recreate these correctly afterwards).
Resume backup.