Google Wallet moves to close security loophole

An attendee takes a photo of the Google wallet application screen during a news conference unveiling the mobile payment system in New York May 26, 2011.

REUTERS - Google Inc has temporarily disabled provisioning of prepaid cards for its Google Wallet mobile payment platform following security concerns that arose this week, the company said late on Friday.

The action was in response to a flaw uncovered by Colorado-based security firm zvelo that could allow unauthorized access to a user's prepaid funds if a stolen or found mobile phone did not have a screen lock enabled, Osama Bedier, vice president of Google Wallet and Payments, said in a blog post.

Google had said earlier on Friday that it was "working to resolve the issue," but offered no further details at that time.

Google strongly discouraged users of the digital wallet from disabling security mechanisms such as password-protected screen locks or from "rooting" their mobile phones to unlock software restrictions on the devices.

Although Google Wallet is automatically wiped from "rooted" phones in most cases, the company elected to take further action.

"Tonight we temporarily disabled provisioning of prepaid cards. We took this step as a precaution until we issue a permanent fix soon," Bedier said.

The Google Wallet platform is available in phones sold by Sprint Nextel Corp (S.N).

(Reporting by Karl Plume in Chicago; editing by Mohammad Zargham)