SunPKCS11 sun.security.pkcs11.wrapper.PKCS11Exception: CKR_ARGUMENTS_BAD

In a desperate attempt to workaround the SunMSCAPI related problem (in thread 2444737 I wrote another signed applet to perform signatures using a SunPKCS11 SmartCard implementation with the source as given below:

import java.security.*;
import javax.security.auth.callback.CallbackHandler;
import javax.swing.*;
import java.awt.*;
import java.io.ByteArrayInputStream;
import java.io.FileOutputStream;
import java.io.InputStream;
import java.security.cert.X509Certificate;
import java.text.SimpleDateFormat;
import java.util.Arrays;
import java.util.Enumeration;
import java.util.Set;

public class TestSunPKCS11 extends JApplet {

    @Override
    public void init() {
        log("init() OS="+System.getProperty("os.name")+", Java="+System.getProperty("java.version")+", "+this.getClass().getPackage().getImplementationVersion());
        Container content = getContentPane();        JTextArea t = new JTextArea("Hello PKCS11!");        t.setLineWrap(true);        content.add(t);

        String pkcs11Config = "name = SmartCard"+System.getProperty("line.separator")+"library = c:\\windows\\system32\\pteidpkcs11.dll";
        byte[] pkcs11configBytes = pkcs11Config.getBytes();
        ByteArrayInputStream configStream = new ByteArrayInputStream(pkcs11configBytes);
        final Provider pkcs11Provider = new sun.security.pkcs11.SunPKCS11(configStream);
        Security.addProvider(pkcs11Provider);
        CallbackHandler cmdLineHdlr = new com.sun.security.auth.callback.DialogCallbackHandler();
        KeyStore.Builder builder = KeyStore.Builder.newInstance("PKCS11", pkcs11Provider, 
                new KeyStore.CallbackHandlerProtection(cmdLineHdlr));

        KeyStore aKeyStore;
        PrivateKey privateKey;
        X509Certificate certificate;
        String alias = "CITIZEN SIGNATURE CERTIFICATE";
        //String alias = "CITIZEN AUTHENTICATION CERTIFICATE";
        char[] password = "xxxx".toCharArray(); //"password".toCharArray();
        byte[] data = "Data to be signed!".getBytes();
        String aliasCode = null;

        try {
            aKeyStore = builder.getKeyStore();
            //aKeyStore = KeyStore.getInstance("PKCS11");
            //aKeyStore = KeyStore.getInstance("PKCS11",pkcs11Provider);
            //aKeyStore.load(null,password);
            log("ks provider=" + aKeyStore.getProvider().getInfo());
            Set<Service> ss = aKeyStore.getProvider().getServices();
            for (Service s : ss) {
                PDFSignerApplet.log("s.getType="+s.getType()+", algorithm="+s.getAlgorithm());
            }
            //aKeyStore.load(null);
            Enumeration<String> aliases = aKeyStore.aliases();
            while (aliases.hasMoreElements()) {
                String a = aliases.nextElement(); log("keystore alias: " + a);
                if (alias.equals(a)) {
                    log(" selected " + a);
                    aliasCode = a;
                }
            }

            final PrivateKey key = (PrivateKey) aKeyStore.getKey(alias, null);
            final java.security.cert.Certificate[] chain = aKeyStore.getCertificateChain(alias);

            final Signature sign = Signature.getInstance("SHA1withRSA",aKeyStore.getProvider()); // PKCS11-SmartCard provider failed before with java.security.InvalidKeyException: Private key must be instance of RSAPrivate(Crt)Key or have PKCS#8 encoding at sun.security.pkcs11.P11RSAKeyFactory.implTranslatePrivateKey(P11RSAKeyFactory.java:101)...
            sign.initSign(key);
            sign.update(data);

            byte[] ba0 = sign.sign(); // BREAKS HERE with sun.security.pkcs11.wrapper.PKCS11Exception: CKR_ARGUMENTS_BAD
            display("Sig0:",ba0);
                        
            privateKey = (PrivateKey) aKeyStore.getKey(aliasCode, password);
            certificate = (X509Certificate) aKeyStore.getCertificate(aliasCode);
            //privateKey = key;
            //certificate = (X509Certificate)chain[0];
            //aKeyStore.load(null);
            
            Signature signature = sign;
            //Signature signature = Signature.getInstance("SHA1withRSA");
            //signature.initSign(privateKey);
            signature.update(data);

            // Sign again
            byte[] ba1 = signature.sign();
            display("Sig1:", ba1);
            
        } catch (Exception e) {
            e.printStackTrace();
        }
    }

    public static void display(String aLabel, byte[] ba) {
        StringBuffer sb = new StringBuffer();
        for (byte b : ba) {
            sb.append(String.format("%02x", b)).append(" ");
        }
        log(aLabel+" "+sb);
    }
    public static void log(String aMsg) {
        System.out.println(aMsg);
    }
}

For this source I get the following console log:

init() OS=Windows 7, Java=1.7.0_07, 2.0.30.build563
ks provider=SunPKCS11-SmartCard using library c:\windows\system32\pteidpkcs11.dll
...
s.getType=Signature, algorithm=SHA1withRSA
...
s.getType=KeyStore, algorithm=PKCS11
keystore alias: CITIZEN AUTHENTICATION CERTIFICATE
keystore alias: CITIZEN SIGNATURE CERTIFICATE
 selected CITIZEN SIGNATURE CERTIFICATE
java.security.ProviderException: sun.security.pkcs11.wrapper.PKCS11Exception: CKR_ARGUMENTS_BAD
	at sun.security.pkcs11.P11Signature.engineSign(P11Signature.java:547)
	at java.security.Signature$Delegate.engineSign(Unknown Source)
	at java.security.Signature.sign(Unknown Source)
	at org.itij.applet.TestSunPKCS11.init(TestSunPKCS11.java:82)
	at com.sun.deploy.uitoolkit.impl.awt.AWTAppletAdapter.init(Unknown Source)
	at sun.plugin2.applet.Plugin2Manager$AppletExecutionRunnable.run(Unknown Source)
	at java.lang.Thread.run(Unknown Source)
Caused by: sun.security.pkcs11.wrapper.PKCS11Exception: CKR_ARGUMENTS_BAD
	at sun.security.pkcs11.wrapper.PKCS11.C_SignFinal(Native Method)
	at sun.security.pkcs11.P11Signature.engineSign(P11Signature.java:509)
	... 6 more

I am not sure that this problem is reproducible (as I think I have gotten a " java.security.InvalidKeyException: Private keys must be instance of RSAPrivate(Crt)Key or have PKCS#8 encoding" error before but the DLL provider documents this signing algorithm as supported), but, as I am not a PKCS#11 implementation expert, I have no clue what the current error message is, or what is wrong.

If this is a problem of the underlying DLL, how can I build a bug report to the DLL provider ? If it is with my code, I would appreciate if anyone can explain what I am doing wrong.

Joao