A serious security risk has been found in the 2.0.2 software which allows anyone to gain access to a password protected iPhone, according to a MacRumors forum post.
This simple trick will bypass the passcode and give you access to all of the personal information on the phone including Mail, SMS, Contacts and Safari.
To duplicate this hack simply set a password on your iPhone then on the passcode lock screen follow these directions.
Step One: Tap the Emergency Call button Step Two: Double Press the Home Button.
These steps will bring up the Favorites Menu. From here you can call your favorites or tap blue arrow next to contact's name. You now have full access to applications such as Safari, complete Contacts list, SMS, Maps, "full" Phone access, and Mail by accessing various entries on the Favorite's page, i.e. tapping their home page brings up a full, unrestricted Safari.
This security flaw makes your iPhone's password lock useless so take appropriate steps to secure your phone!
This does not give you FULL access as this post suggests. Depending on which contacts are in your favorites and what types of info is stored in them you can gain access to Mail, Safari, SMS and Maps. You are not able, as far as I could tell, to get to the actual Home screen. This is not quite FULL access but still not good.
Also one thing to note is that this was intended to be a feature and is not an overlooked security flaw. That said it indeed does allow free access to much of your personal information so is bad.
Security Risk in 2.0.2 can be found in 2.0.1 as well. I have a 2G unlocked and jailbroken iPhone running 2.0.1. After reading about the threat I tried it out on my phone and found it worked exactly the same way as described. Thank you for pointing this out.
It wasn't working because I had double pressing home button set to "Home", the bypass did work when I changed it to "iPhone favourites".
Apple fix this issue NOW!!!!!