SharePoint 2013 People Picker not working for domain security groups for List and Document Library Alerts

Issue Description

1. Not all the groups are being resolved by document library/list people picker.

2. You cannot send alerts to a security group instead of a user.

3. Even if some of the groups are being resolved, the alert emails are still not being sent.

Users were unable to setup email alerts on Document library "library1" on SharePoint site "http://mysitename/sites/site1/" for some Active directory groups "domain\ADGroup"

Product Version: SharePoint 2013

You get the below error message:

Unable to set alerts to domain security groups with error "We couldn't find an exact match" or “Sorry, you are not allowed to share this with external users.”

Cause

I had opened a ticket with Microsoft for this issue and worked with them and they finally confirmed this is a bug with SharePoint 2013. This issue has been fixed with May 7, 2014 Cumulative Update for SharePoint 2013.

Resolution

1) Log in to the all the SharePoint Servers in the farm. Browse to C:\Program Files\Common Files\microsoft shared\Web Server Extensions\15\TEMPLATE\LAYOUTS

2) Make a copy of SubNew.aspx .Now modify the SubNew.aspx . Search for <wssawc:ClientPeoplePicker

3) Paste the below text after the section SelectionSet="User,SecGroup" :

PrincipalAccountType="User,SecGroup"