You can change "Close window on exit: " in Putty to "never" and see if it gives you a specific error.
I know it will print "Access Denied" if you get the password wrong. I'm not sure, but that might be the same error you'd get if the user doesn't have shell access enabled.
The wiki says you'll get a " Server unexpectedly closed network connection" if your IP has been blocked for too many failed logins, which support can fix.
Did you just enable shell access for the user you're trying to connect with? If so, maybe the change didn't take effect yet.
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