Windows Phone GDR2 includes anti-theft protection to secure your lost or stolen handset

Among the features included with the GDR2 update for Windows Phone 8.1 is an anti-theft system that will make sure that your device is secure even if it is lost or stolen. If your handset was safely unlocked when it went AWOL, no one will be able to reset or reflash the device for their own personal use.

The manufacturer does need to enable this "Reset Protection" so not every Windows Phone model will have it available. There are two parts to this system. The first part asks the user who performs a factory reset on the phone to enter the Microsoft username and password associated with the unit. If a new image is flashed on the device, and reset protection is switched on, the only way the device can be used is if the original phone owner enters the correct information. This is similar to something that we have seen added recently with Android 5.1.

The second part of the system involves a Windows Phone handset that does have the Reset Protection turned on. In that case, a lost or stolen phone cannot be flashed back to an earlier version of the OS that does not support Reset Protection, which would be a clever move by a phone thief. If you forget your Microsoft Account username and password, reset protection can be disabled using a "recovery key." To obtain the key, you need to upload the device's IMEI code to the Reset Protection unlock page. Once your code is received, the recovery key is sent allowing you to access your handset again.

source: NPU