Looks like some hackers do not think much of Apple's iPhone 3GS hardware encryption and claim they have never seen encryption implemented so poorly before:

There were other features taking higher billing in the iPhone 3GS' announcement than its hardware-level encryption -- hell, even the magnetic compass was getting more play -- but it's there, and Apple's actively marketing the bit-scrambling capability to enterprise clients. Problem is, hackers are apparently having a field day with it, rendering it useless in all but name. One iPhone dev (who teaches courses on pulling data off iPhones, coincidentally) goes so far to say that he doesn't "think any of us have ever seen encryption implemented so poorly before," noting that it's no more difficult for him to pull data off a 3GS than it is off an encryption-free 3G. He goes on to point out that RIM -- which has far more experience dealing with enterprise-class mobile fleets than Apple does -- offers a far more robust remote wipe solution that doesn't necessarily need to rely on an active wireless connection to clear a phone. The lesson? As overwhelmingly popular as the iPhone may be across every market segment, these guys are still the new kids on the enterprise block -- and RIM (and heck, Microsoft, too) would be wise to stand their ground here.