It is not meant to protect one users' files from another user on the same system. This behavior may seem a bit concerning, especially for those who have set up encryption on secondary drives in hopes of preventing others from viewing their files, but this is normal behavior in OS X, and essentially means two things: An attached and mounted drive and even private contents on it will be viewable in all user accounts. In addition, if you have network file sharing enabled, the files on this drive will be accessible to any user who logs in via the network. Therefore, if you have files you have saved to a USB drive and you attach it to your system and you switch user accounts, those files will be viewable within the second account.
If you use an external disk drive with OS X, you may notice that when it is mounted, it becomes available for all users on the system.
