Were there any patches installed prior to this problem ? There are some patches that can change the behavior of su command, which one .. I got to look it up. One more thing I can suggest for you to try .. just on one of the user, try to rename .sh_history to say .sh_history.old and try the su again. While you're at it I just need to confirm again, the home dir is local right and you're not running NFS nor NIS.