Media Encoder renders test pattern (color stripes)

CC 2015 - latest build. When I choose to render with Adobe Media Encoder from AE, the Media Encoder renders a test pattern not the video in the project (like not having the media available). The files are on an internal HD (DNG sequence). Tried with AE render and it works with no problem but no way to make Media Encoder to work. What s going on here? Same thing happens with all projects.

Please help and thanks