Originally posted by ATHER
I read a document in metalink which says this is a bug.

Below is the Anwer to your question from metalink.

You do not need to comment out sqlnet.authentication_services within the sqlnet.ora. You can apply the latest 8.1.6 patchset as the ora-12538 problem has a fix. If you have not applied any patchsets to the 8.1.6 release you will want to download and install 8.1.6.3.0 and then install 8.1.6.3.4 to fix this problem. Please read the readme.txt files for more installation instructions before application
10x! However, I have this "bug" on 8.1.7 :-)
It seems that Oracle has not fixed it after 8.1.6