The Xbox 360 console has a factory restore feature that you can use to purge the console of all your data, which comes in handy when you're looking to sell it and don't want to hand out your personal information. Unfortunately, according to Drexel University researcher Ashley Podhradsky, restoring your Xbox to factory settings isn't enough to prevent someone from getting your credit card information off of the device with the right modding tools. Using the modding software, Podhradsky and her team were able to access the console's files and folders, which contained data that hadn't been wiped out.
Podhradsky says this isn't anything new for Microsoft, that the company has always protected their proprietary information over the information of the user. She cites a Windows PC reformat as an example, saying that while Windows informs you that all of your data will be erased, that isn't exactly the case there, either. Those looking to sell their Xbox 360 console can successfully wipe their personal info by hooking the hard drive up to a computer and using a specially-made program, but that sounds beyond the capabilities of the average PC user.
via The Verge