You will need dkms for your kernel if you haven't got it.
cd /lib/modules/`uname -r`/kernel/drivers/staging/rt2860
sudo mv rt2860sta.ko rt2860.bak
Download new driver:
http://www.array.org/ubuntu/dists/intrepid/eeepc/binary-i386/rt2860-dkms_1.7.1.1_all.deb
then sudo dpkg -i rt2860-dkms_1.7.1.1_all.deb
sudo init 6
WPA1/2 should work now.