Straight from TheHorse (.com)'s mouth:

The "Proud-Cut" Myth

Geldings which continue to mount mares or those which have continued aggressive behavior following castration are often referred to as being "proud cut." This term has been used to imply that the castration was not completely performed (intentionally or unintentionally), and that a portion of a testicle or epididymis was left in the horse and is still producing hormones (particularly testosterone) that cause stallion-like behavior. If a portion of the epididymis was left in the horse, it would not cause the horse to continually act like a stallion as the epididymis cannot produce testosterone on its own.

If you have a "gelding" which acts like a stallion, there are two possibilities.

Problem 1: The horse might have a cryptorchid testicle that is retained high in the flank or in the abdomen that still is producing testosterone and creating the stallion-like behavior. The testicle was not found during a normal castration, and the entire testicle or a major portion of it was left in the horse.

Solution: Your veterinarian can take blood samples to determine if your horse is producing testosterone at similar levels to a stallion. A baseline blood sample is taken, then a hormone (hCG--human chorionic gonadotropin) is administered and will stimulate testosterone production if the horse has functional testicular tissue in his body. This is one of the best ways to determine if a horse has a cryptorchid testicle hidden somewhere.

Problem 2: Your horse is a true gelding with no testosterone-producing tissue in his body (i.e., no testicular tissue) and still displays stallion-like behavior, possibly due to learned behavior. On the other hand, in one study in which male horses' behavior was evaluated following castration, there was no significant difference in behavior whether the horses were castrated at less than two years of age or at more than three years of age. Regardless of the age at which they were castrated, up to 30% of the horses still displayed stallion-like behavior, including aggression toward other horses. The study noted that 5% of the horses displayed aggression toward humans.

Solution: Most veterinarians believe that in true geldings, appropriate training can reduce or eliminate the stallion-like behavior. Luckily, most castrations in horses are performed with no complications, and a healthy, well-adjusted gelding is the end result.