diff -ruN source.orig/smbd/posix_acls.c source/smbd/posix_acls.c
--- source.orig/smbd/posix_acls.c	2007-11-15 04:15:04.000000000 +0100
+++ source/smbd/posix_acls.c	2007-11-20 16:39:11.000000000 +0100
@@ -3243,6 +3243,9 @@
 	  * Append u/g/w.
 	  */
 
+	/* We do not append these parent permissions, because they always cause
+	 * user, group and world to have read access.
+	 * It might be incorrect or inappropriate to not add these, however.
 	status = append_ugw_ace(fsp, psbuf, unx_mode, S_IRUSR, &new_ace[i++]);
 	if (!NT_STATUS_IS_OK(status)) {
 		return status;
@@ -3255,6 +3258,7 @@
 	if (!NT_STATUS_IS_OK(status)) {
 		return status;
 	}
+	*/
 
 	/* Finally append any inherited ACEs. */
 	for (j = 0; j < parent_sd->dacl->num_aces; j++) {