Awhile back, R2, JR and I were involved in some sleuthing in an attempt to determine how and where .NET passwords for Messenger, MSN, Hotmail and the like were stored and thus modifiable. Although this does not divulge the storage location, a recent WinGuides Network Newsletter published this setting that controls the storage of authentication credentials and .NET passwords on the local system. By disabling this feature, credentials & passwords will not be stored.

System Key: HKEY_LOCAL_MACHINESYSTEMCurrentControlSetControlLs a
Value Name: DisableDomainCreds
Data Type: REG_DWORD (DWORD Value)
Value Data: 0 = enable storage (default), 1 = disable storage