An investigation into used smartphones being sold by popular trading chains Cash Converters and CEX has found that plenty are going to new buyers complete with the personal data of the previous owner. Some are wiped, but there's wiping and there's wiping.
According to Channel4's investigators, "photos, text messages, passwords, credit card information and internet searches" were recovered from phones bought through CEX and Cash Converters, with previous owners opening themselves up to identity theft and the more modern crime of random people hijacking their Twitter accounts.
However, there's more to it then people simply forgetting to factory reset their phones before selling them on. Channel 4 enlisted the help of security specialists at SensePost, who then used software tools to restore data presumed deleted. The larger problem being that, as with computer hard drives, most phones' onboard reset tools simply remove the folder structure data to "wipe" their memories, leaving the actual files themselves in place and often recoverable.