There have been security problems found in the new Google Wallet service. If you leave your phone unattended, or if it is lost or stolen, there are ways a thief can use the money credited to Google Wallet.
Zvelo, a security firm, discovered that the Google Wallet PIN, , can be cracked via an exhaustive numerical search and there is an app for that which makes cracking into Google Wallet very easy for hackers. According to Zvelo, the only way to fix the problem is to move the PIN verification to Secure Device (SE), or the NFC chip. The phone was easy to hack because it was rooted.
Google issued this statement:
The Zvelo study was conducted on their own phone on which they disabled the security mechanisms that protect Google Wallet by rooting the device. To date, there is no known vulnerability that enables someone to take a consumer phone and gain root access while preserving any Wallet information such as the PIN."
The next problem occurs if a phone is lost without being locked. The thief who steals the device can go to app settings for Google Wallet, clear the data.
Then the robber restarts the phone and sets up a new Google Wallet pin and use all the prepaid money in the account. The Google Wallet funds are connected to the hardware not a cloud account.
Google is working on a fix and has responded by saying
"We strongly encourage anyone who loses or wants to sell or give away their phone to call Google Wallet support toll-free at 855-492-5538 to disable the prepaid card. We are currently working on an automated fix as well that will be available soon. We also advise all Wallet users to set up a screen lock as an additional layer of protection for their phone.
If you are using Google Wallet, you should lock the screen with a pattern or pin.
A video below shows criminal how to do it.