Update 10/03/10 - This problem re-occured on one of my clients today - cured the problem by removing the VPN client, and upgrading to version 5.0.07.0240-k9-BETA.

1. Click Start > Computer.
2. Double-click your C: drive.
3. Double-click Program Files > Cisco Systems > VPN Client.
4. Right-click on cvpnd.exe and select Properties.
5. Click the Compatibility tab.
6. Put a check mark next to the option, Run this program in compatibility mode for:.
7. Make sure Windows XP Service Pack 2 is selected.
8. Click Apply and then click OK.
9. Right-click vpngui.exe and select Properties.
10. Put a check mark next to the option, Run this program in compatibility mode for:.
11. Make sure Windows XP Service Pack 2 is selected.
12. Click Apply and then click OK.
13. Restart your computer.

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