It was not working properly before, when I was using a FAT32 external HDD. I reformatted the HDD to HFS (mac disc format), and the Vault do work flawlessly!
I guess the major difference is the HFS disc works much faster than a FAT32 one. Another reason may be I am using a USB external.... too bad I have the Unibody Macbook Ver 1, which came without the firewire port. Sigh!