The vulnerability exists in the IsSensitivePath function in kernel/util/path.go, which implements a flawed denylist-based approach for path validation. This denylist does not include several sensitive directories, allowing an attacker to bypass the security check. The globalCopyFiles function in kernel/api/file.go uses this vulnerable function, which leads to an arbitrary file read vulnerability. An attacker can specify a sensitive file path, which will be copied to a publicly accessible directory, and then the attacker can read the file. The fix involves switching to an allowlist approach, only permitting access to the workspace directory and explicitly approved paths.