An anonymous reader writes "Bruce Schneier and colleagues from the University of Washington have figured out a way to break the deniability of TrueCrypt 5.1a's hidden files. What about the spanking-new TrueCrypt 6? Schneier says that 'The new version will definitely close some of the leakages, but it's unlikely that it closed all of them.' Meanwhile, PC World is reporting that the problems Schneier and colleagues found are bigger than just TrueCrypt. Among their discoveries: Word auto-saves the contents of encrypted files to the unencrypted portions of your disk, and this problem should apply to all non-full disk encryption software. Their research paper will appear at Usenix HotSec '08."