Hello, I confirm this problem, after short investigation i've found that:
- if password is in /etc/gpasswd - newgrp doesn't work,
- if password is in /etc/group then newgrp works as expected.

So temprorary solution is to put group password into /etc/group file,
hashed with md5 (for obvious reason ;) )

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https://bugs.launchpad.net/bugs/600377

Title:
  newgrp password enabled group doesn't work

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