ADFS joining error for Office 365

Hello,

We are setting up ADFS for Office 365. Installed ADFS and have no WAP, dns directly maps to the ADFS server and has public certificate. When we use the Azure AD connect tool to change signin it runs through the steps and fails at below.

We have a local SQL on the ADFS server and it allows remote connections as well. So don't understand the error.

[12:15:02.606] [ 31] [ERROR] An error occurred while executing the 'Add-AdfsFarmNode' command. You cannot add this server to the farm because this farm is setup using a remote SQL server.
Exception Data (Raw): Microsoft.Online.Deployment.PowerShell.PowerShellInvocationException: An error occurred while executing the 'Add-AdfsFarmNode' command. You cannot add this server to the farm because this farm is setup using a remote SQL server.---> System.Management.Automation.RemoteException: You cannot add this server to the farm because this farm is setup using a remote SQL server.
   --- End of inner exception stack trace ---
   at Microsoft.Online.Deployment.PowerShell.PowerShellHelper.InvokeAndThrow(IPowerShell powerShell, Command command, Boolean throwExceptionOnError)
   at Microsoft.Online.Deployment.PSModule.Tasks.ADFS.ConfigureJoinADFSTask`1.Execute()
   at Microsoft.Online.Deployment.Framework.Workflow.WorkflowTask.ExecuteWrapper()
[12:15:02.610] [ 31] [INFO ] ConfigureSyncEngineStage.StartADSyncConfiguration: AADConnectResult.Status=Failed

Tried letting the AD connect wizard install the ADFS feature as well, but still the same error. There are no options to chose SQL on the wizard. So it doesn't help.

Regards,

Ramu

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Ramu V Ramanan