public class PrincipalService: IDisposable
{
    const int MaximumDepth = 100;

    PrincipalContext context;

    public PrincipalService()
    {
        context = new PrincipalContext(ContextType.Domain);
    }

    public IEnumerable<string> GetGroups(string identity)
    {
        var user = UserPrincipal.FindByIdentity(context, identity);
        return GetGroups(user, 0).Distinct();
    }

    private IEnumerable<string> GetGroups(Principal principal, int currentDepth)
    {
        foreach (var group in principal.GetGroups())
        {
            yield return group.Name;
            if (currentDepth < MaximumDepth)
            {
                foreach (string sub in GetGroups(group, currentDepth + 1))
                {
                    yield return sub;
                }
            }
        }
    }

    public void Dispose()
    {
        context.Dispose();
    }
}