It was found that if an attacker had access to an unlocked phone, they could take any data from the application's sandbox through ADB's backup feature.
Normally ADB backup allows applications to be backed up to the cloud. This means that if a user replaces or wipes their phone, they can restore app settings.
This feature is on by default and needs to be explicitly disabled in the manifest <application allowBackup="false"
If enabled (or not explicitly disabled), then the backup feature can also be used over USB (details here: http://nelenkov.blogspot.co.uk/2012/06/unpacking-android-backups.html). This means that the shell user, which can not normally access files in the sandboxes of applications, can read and write to them.
In the case of the Faceless Android app, it meant that if an attacker had access to an unlocked android device, then they could recover all the files from Faceless' sandbox to their PC. This includes the im.delight.faceless_preferences.xml file which holds the username and password
This could then be restored to another device, allowing for account cloning.