Project Server 2010 Cube Build: Error: This method can only convert identity claims, and only when a logical conversion exists

A customer recently had an issue with building the cube, the error experienced was;

===== Initiating OLAP database build process =====
[24/06/2014 11:07] Cube build request message has been added to the Project Server queue
===== Verifying and running pre-build server event handler =====
[24/06/2014 11:07] Verifying and running pre-build server event handler
===== Determining database and OLAP database structure =====
[24/06/2014 11:07] Cube build initialization started
[24/06/2014 11:07] OLAP database and cube structure was determined successfully
===== Building database and cubes =====
[24/06/2014 11:07] Cube build session started
===== Process Completed =====
[24/06/2014 11:08] Failed to build the OLAP cubes. Error: Error Setting Olap Database ‘ProjectServer_Analysis’ roles: Error: This method can only convert identity claims, and only when a logical conversion exists.
Parameter name: encodedClaim

Looking into it online, seemed to suggest deleted AD users who become inactive in Project Server as a result (where they have sync setup), still belong to Project Server groups and this error occurs as part of Project Servers checks when building the cube. To quickly see who is inactive and belongs to PWA groups, I made this simple SQL Query;

SELECT
ResourceName,
ResourceGroup

FROM
MSP_EpmResource_UserView

WHERE
ResourceIsActive = 0 AND ResourceGroup <> ‘NULL’

ORDER BY
ResourceName

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