Arvados

OpenSSH will refuse to use an authorized_key file if it is group-writable or global-writable.
In RH-based distributes, umask is default to 002, which means the file will be 660, which violate the rule, and stop the ssh-key login procedure.
For the other distributions which probably don't have this problem, this is for safety sake.

I'll create a github pull request in a short while.

Example:

[root@shell ~]# ls la ~someone/.ssh/
total 12
drwx----- 2 someone someone 4096 Sep 28 10:08 .
drwxr-x--- 5 someone someone 4096 Sep 28 09:48 ..
rw-rw--- 1 someone someone 699 Sep 28 10:10 authorized_keys

[root@shell ~]# /usr/sbin/sshd -f /etc/ssh/sshd_config -p 8888 -Dd
debug1: sshd version OpenSSH_5.3p1
debug1: read PEM private key done: type RSA
...
debug1: temporarily_use_uid: 501/502 (e=0/0)
debug1: trying public key file /home/someone/.ssh/authorized_keys
debug1: fd 4 clearing O_NONBLOCK
Authentication refused: bad ownership or modes for file /home/someone/.ssh/authorized_keys
debug1: restore_uid: 0/0
...