The same bug was reported last week by another person and it is already solved in the development release 1.37_07 available from CPAN (I plan to release it as stable next week if no bugs are found in the meantime).

The bug is actually in HP-UX and it is discussed here.

In reply to Re: Net::SFTP::Foreign Connections with Password Authentication by salva
in thread Net::SFTP::Foreign Connections with Password Authentication by allyc

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