Xbox Live Hacked - MS Investigating

Reports have been scattered (and largely ignored) around the net for sometime that Xbox Live users were having their credit card information stolen and used to rack up massive amounts of Gamer Points (the virtual currency used to purchase items from Xbox Live). This forum post on Xbox.com is just one example.

Now it seems Microsoft is finally acknowledging the incidents as fact.

"Recently, there have been reports of fraudulent activity and account theft taking place on the Xbox Live network," a Microsoft representative said in a statement provided to CNET News.com. "Security is a top priority for Xbox Live, and we are actively investigating all reports of fraudulent behavior and theft."

You can read the full story on Cnet.

Kevin Finisterre, a security researcher, was playing Halo when some opponents threatened to hack his account. The following day his girlfriend's Xbox Live account was disabled. After making SEVEN calls (is this their idea of quick response) to Microsoft customer support (MSCS), he finally got them to investigate the incident for fraud.

Transcripts of Finisterre's conversations with MSCS as well as a list of clans that have been stealing account information is freely available on his site.

Griefers in online games are an unfortunate evil that can never be fully avoided, but this takes things to a whole new devious and illegal level.

Let's hope Microsoft is successful in catching and prosecuting these offenders.

We'll update you when we hear from Microsoft on the results of their investigations.