In this paper, we present a very first study to investigate trust and ethical implications of on-device artificial intelligence (AI), focusing on ''small'' language models (SLMs) amenable for personal devices like smartphones. While on-device SLMs promise enhanced privacy, reduced latency, and improved user experience compared to cloud-based services, we posit that they might also introduce significant challenges and vulnerabilities compared to on-server counterparts. As part of our trust assessment study, we conduct a systematic evaluation of the state-of-the-art on-devices SLMs, contrasted to their on-server counterparts, based on a well-established trustworthiness measurement framework. Our results show on-device SLMs to be (statistically) significantly less trustworthy, specifically demonstrating more stereotypical, unfair and privacy-breaching behavior. Informed by these findings, we then perform our ethics assessment study by inferring whether SLMs would provide responses to potentially unethical vanilla prompts, collated from prior jailbreaking and prompt engineering studies and other sources. Strikingly, the on-device SLMs did answer valid responses to these prompts, which ideally should be rejected. Even more seriously, the on-device SLMs responded with valid answers without any filters and without the need for any jailbreaking or prompt engineering. These responses can be abused for various harmful and unethical scenarios including: societal harm, illegal activities, hate, self-harm, exploitable phishing content and exploitable code, all of which indicates the high vulnerability and exploitability of these on-device SLMs. Overall, our findings highlight gaping vulnerabilities in state-of-the-art on-device AI which seem to stem from resource constraints faced by these models and which may make typical defenses fundamentally challenging to be deployed in these environments.